Overview
UTD recognizes that consulting work for external entities enhances the professional development of faculty members and researchers, and provides channels for communication and outreach not otherwise available. Hence, reasonable participation in consulting is encouraged.
Consulting is professional activity related to an individual’s area of expertise, where that individual receives compensation from a third party and is not acting as an agent or representative of UTD. Consulting may take many forms, but the guiding principle is that, in consulting, a person agrees to use his or her professional capabilities to further the agenda of a third party in return for an immediate or prospective gain. Examples of allowable consulting activities include:
- Serving as an expert witness
- Providing independent analysis, mentoring, or specialist advice
- Advising the company on technology or business development
- Providing a pedagogical overview of a subject matter or method
Consulting does not involve becoming an employee of the external entity. Consulting duties cannot involve roles or duties in which you will be expected to make inventive contributions or create intellectual property for the company. Activities or titles that constitute or imply managerial or supervisory responsibility are not permitted as consulting relations. Employees should avoid participating in dedicated marketing and training programs designed solely or predominantly for sales or marketing purposes. This includes promotional marketing activities to academic colleagues, the media, the public, or as an exhibitor.
Activity Approval Guidelines
Consulting is only permitted provided the employee’s obligations to UTD are being met. Consulting arrangements may be entered into by employees during periods of university employment provided that:
- such advice is not part of their employment responsibility to UTD and is not normally provided through a program or component of UTD;
- the work undertaken contributes to the mission of UTD or their professional development;
- the work can be accomplished without interference with their assigned duties and does not involve more than one day (8 hours) per week, averaged over the semester;
- university resources and facilities are not involved; and
- prior approval is obtained from the employee’s supervisor and COI Official.
Conflict of interest concerns generally prohibit employees from consulting with an industrial sponsor of their research at UTD, or with a licensor of UTD intellectual property. Consulting agreements should not impose restrictions on an employee’s ability to perform UTD research and obtain research funding. Such requests will be reviewed on a case-by-case basis by the COI Official.
However, professional consulting through sponsored research agreements executed and administered by UTD can be more beneficial to all parties for the following reasons:
- Allows for use of UTD’s facilities, resources, and the involvement of UTD students and staff
- Provides opportunities to involve students and postdoctoral researchers in applied research
- Minimizes potential for intellectual property conflicts between the sponsor and UTD
- Provides opportunity to participate in translational research
- Reflects UTD sponsored research productivity
Separating Consulting from UTD Responsibilities
UTD is not party to consulting agreements between faculty and external entities, and has no obligations or potential liability under the agreement. Employees should have an arrangement in place that clearly defines the technical scope and terms of the consulting activity (e.g., written contract or other agreement with the outside entity). It is strongly recommended that employees seek review of any proposed arrangement by their personal legal and tax advisors.
Employees must avoid entering into consulting agreements that are in violation of the terms of their employment by UTD. Employees must also avoid other situations in which their consulting activities could affect their UTD responsibilities:
- The UTD name, logo, and/or letterhead may not be used in any consulting activities.
- Employees may not use UTD facilities or resources in consulting activities, including research data, laboratories, supplies, equipment, and software. Research data created by the employee using UTD facilities are owned by UTD, and only data that is publicly available can be used for outside consulting.
- If a faculty member is listed as an author on any publication resulting from performance of consulting services, a disclosure should be included stating that “Dr./Professor [NAME]’s contribution to this publication was as a paid consultant, and was not part of his/her UTD duties or responsibilities.” Similarly, if hired as an expert witness, the faculty member must state that the activity is not part of his or her UTD responsibilities, but rather that the expertise is provided as a private consultant.
- The involvement of students and staff in faculty consulting activities should be undertaken with caution. Faculty must avoid even the appearance of directing students into research activities that serve their own personal interests at the expense of the student’s academic or research interests. Please refer to the Guidelines on Student Participation in Conflicts of Interest for more information on involving students and trainees in outside activities.
Intellectual Property Responsibilities to UTD
Under the UT System Regents Rules and Regulations, all discoveries and inventions developed by UTD employees within the course and scope of employment of the individual or resulting from activities performed at UTD belong to the Board of Regents. These rules and regulations apply to all persons employed by UT System and/or any UT System institution, including, but not limited to, full and part-time faculty, staff, visiting faculty members, researchers, and students enrolled in UT System institution programs.
Faculty and staff should not enter into consulting agreements that result in assigning inventions and intellectual property to an outside entity. Employees are strongly encouraged to include provisions in their respective consulting agreements stating that the outside entity acknowledges the consultant is a UTD employee, and that he/she is required to disclose all inventions to UTD and to assign to UTD all intellectual property resulting from activities that fall within the course and scope of employment.
All inventions and intellectual property developed or created by a UTD employee outside the course and scope of his/her employment, and on his/her own time without support of UTD or any use of UTD facilities or resources, is the exclusive property of the employee. Consult with OTC to ensure a discovery meets these criteria.
Employees are required to confidentially disclose all inventions, intellectual property rights and interests either developed within the course and scope of the employee’s outside employment or resulting from the activities performed to UTD’s Office of Technology Commercialization. This disclosure provides UTD an opportunity to assess, together with the employee and/or company, as to whether or not the invention is subject to the provisions under the UTD IP Policy.
Sample Terms and Conditions Regarding Intellectual Property
Consulting agreements should recognize that all employees have pre-existing and controlling obligations to UTD. All UTD employees agree to abide by UTD’s Intellectual Property Policy and should include the following provisions in his/her consulting agreement:
- Company specifically acknowledges that Consultant is an employee of UTD (and as such, an employee of the State of Texas), and is subject to the Rules and Regulations of the Board of Regents of the University of Texas System (“Board”), under which Consultant has agreed to and has assigned to the Board all intellectual property related to Consultant’s employment responsibilities at UTD.
Consulting agreements should acknowledge the importance of documenting the nature and scope of the consulting activities and outline a process for preparing a written summary or minutes of the consulting activities. UTD recommends including the following language:
- The Company shall from time to time prepare a written summary or “minutes” of the consulting activities of Consultant. Consultant shall also record all documentation relative to Consulting Services separate from his/her other work, including work for the University. The parties shall have the right to periodically compare said documentation to ensure both parties have a consistent understanding as to the scope and nature of consulting services provided hereunder.
Releasing Inventors from UTD Intellectual Property Obligations
A UTD employee must obtain written approval from the Office of Technology Commercialization (“OTC”) to agree to assign the employee’s rights to the Entity for Intellectual Property (IP) created during his/her consulting activity. The granting of this release creates greater risk for conflict of interest for the consulting employee because the grant:
- could be used as an opportunity to exclude UTD from licensing decisions
- could create an incentive for the consulting employee to make inventive contributions to the Entity
The release will not be granted if the consultant has an existing conflict of interest or commitment with the Entity, or if the consultant is performing research at UTD funded by the Entity. The release is more likely to be granted if the activity lasts less than one year and/or involves less than $5,000 in compensation.
Consulting employees must disclose to OTC any such intellectual property resulting from the work they perform for the Entity to initiate the release. The intellectual property will only be released after OTC has determined the IP is unrelated to the consultant’s scope of the employment to UTD.
Confidential and Proprietary Information
It is not uncommon for a company to disclose proprietary information to a consultant. Problems may arise when a UTD employee gains access to confidential/proprietary information through consulting activities. Employees should understand exactly what information is confidential, and what their obligations are to protect such information from disclosure. Failure to understand the terms can have serious legal consequences, inclusive of but not limited to the potential liability of UTD to protect the employee in a court of law.
Confidential information, including research or other data acquired or developed through conducting UTD business or research activities (e.g., as a result of a grant, contract, cooperative agreement or other sponsored agreement) may not be used for personal gain, or to grant unauthorized access to others; confidential information includes any information that is not broadly available to the general public, and comes into the employee’s possession as a result of his/her UTD employment.
Employee should consider including language such that the consultant has the right to refuse to accept company confidential information, and to receive confidential information clearly marked as such. UTD recommends including the following language:
- Prior to disclosure of Confidential Information hereunder, Company shall make a non-enabling summary disclosure to Consultant so that Consultant may determine whether to accept disclosure. Said summary shall be sufficient to enable Consultant to determine whether the disclosure involves technology or information already under development in Consultant’s University Laboratory, or whether he/she is otherwise bound by confidentiality concerning related information and/or technology.
- Company will take reasonable precautions to clearly mark information disclosed hereunder as ‘confidential’ or ‘proprietary’. Company will provide to Consultant a written summary of the matters discussed or considered during consulting provided hereunder in a timely manner.
- The confidentiality restrictions hereunder will not apply where the information was previously known to or developed by Consultant or Consultant’s research group, where the information is part of the public domain, or where the information came into the possession of Consultant through no fault or wrongdoing of Consultant.
Terms and Conditions to Avoid in Consulting Agreements
- Do not accept “fiduciary” duty or responsibility.
- Consulting activities should be performed in a relatively narrow and well-defined field. Avoid broad definitions such as “Company Business”.
- Avoid or use caution in accepting exclusive consulting arrangements. Consider the ramifications of agreeing to consult with only one company in a broad field.
- Carefully consider the term (duration) of the consulting agreement. Is there an exit? Can I terminate the consulting agreement “without cause”?
- Carefully review any requirements for representations and warranties, especially with regard to intellectual property issues.
Consulting Agreement Template
The Consulting Agreement Template can be used to expedite the outside activity process and to mitigate risk to the employee and to UTD when a UTD employee serves as a consultant or advisor for a Entity. The template is recommended if the employee:
- owns or co-owns the Entity
- has a fiduciary interest or management role in the Entity
- engages in a long-term consulting arrangement in which he/she will be compensated more than $5,000
- has a conflict of commitment, such as consulting for the Entity while on a leave of absence
- is involved in research at UTD funded by the Entity
Click here to view and download the Consulting Agreement.
Contact Information
Research Integrity and Outreach: Conor Wakeman, Conflict of Interest Manager
Technology Commercialization: Brent Schultze, Director
Form: Activity and Interest Report
[Acknowledgement: Portions of these guidelines were taken from Virginia Tech and Penn State and modified for use at UTD.]