Information for University of Iowa Faculty on Outside Consulting Activities
Web links updated by Office of the Provost 11/07/18
By policy and in practice, the University of Iowa encourages you to engage in outside professional activities. Such activities advance scientific knowledge and are a mechanism for you to serve the institution’s public service mission. However, as a University employee, it is your obligation to ensure that any consulting agreement you enter with a company or other outside entity does not conflict with your obligations to the University as your employer. Although this document refers throughout to “company,” it applies to any outside entity that may engage your services as a consultant.
A faculty consulting agreement is a personal agreement between you and the outside company that governs work you perform for the company’s benefit. The University is not a party to these agreements and any obligations accepted in them are personal to you. However, because you are a University employee, the University has an interest in ensuring that your agreement is not inconsistent with UI policy, state or federal law, or other agreements to which the University is a party.
Specifically, consulting agreements may create conflicts with obligations you have to the UI: obligations that arise by virtue of your employment, by law, by University policy, and/or from University contractual or other obligations to third parties. Consulting agreements may also impose restrictions on your ability to perform University research and to obtain sponsored research funding.
For these reasons, and as a tool for faculty who enter into personal consulting agreements, the University provides this information for you to use in reviewing any proposed consulting agreement. This information is not provided to you as personal legal advice; you may want to consider asking your own counsel to review the agreement on your behalf.
At a minimum, you should read any consulting agreement carefully, since there is no such thing as a “standard” consulting agreement and since consulting agreements are typically written for the benefit of the company.
The following is a list of frequently-appearing consulting agreement issues that may give rise to conflicts with your obligations to the University and/or have negative implications for your University research:
Access to Inventions
The agreement cannot grant a preference to the company for access to inventions (licenses) or to information/data resulting from UI research.
Confidentiality
The agreement cannot define “confidential information” to include information you generate or develop (either alone or with others) during the performance of the consulting services required by the agreement, unless the information generated is unrelated to your University research and is developed:
- Totally during the course of performing the consulting services, and
- Without the significant use of UI resources (i.e., without more than incidental use of phone/email/computer).
You should be satisfied that you can comply with any confidentiality obligations you accept (it may be possible, for example, to limit the amount of information you receive and/or to have the company mark it confidential before disclosure).
You should also be careful that the agreement does not restrict your right to publish anything that is actually and legitimately research (or could eventually be research) conducted at the University.
Conflict of Commitment
Consulting may give rise to issues that are addressed by the University’s Policy on Conflict of Commitment:
Basically, the time you devote to the consulting opportunity cannot interfere with your teaching/research/patient care/service obligations to the UI. You should consult with your DEO prior to engaging in an outside consulting opportunity to ensure that you are in compliance with that policy.
Conflict of Interest
Consulting for an outside company may also give rise to a conflict of interest in the context of your research at the UI. You should consult the University’s Policy on Conflict of Interest in Research:
If you have questions, you should contact the Office of Conflict of Interest in Research at 335.8892.
There may also be an issue with the UI Policy on Conflict of Interest in Purchasing:
Governing Law; Venue for Disputes
The agreement may provide that it is governed by the laws of a state other than Iowa and/or that any disputes under the agreement will be resolved by the courts of a state other than Iowa. This means that any lawsuits arising from the consulting relationship would be filed in the other state and the other state’s laws would apply to that suit. It could be costly for you in the event you have to bring suit or defend a suit in another state.
Independent Contractor Status
The agreement should not expressly state or imply that you are undertaking the consulting work on behalf of the University. It should be clear that you are entering the agreement in your individual capacity and not as an employee or agent of the UI.
Intellectual Property
What is the issue?
Most consulting agreements require you to assign to the company any invention made in the course of performing the consulting services. Some are actually not that limited and may extend to work you perform at the University as a UI employee.
- Where the invention is made with significant use of UI resources
- Where the invention is made in the course of your employment or appointment or in a field or discipline reasonably related to your employment or appointment
Because UI resources are public resources, it would be inappropriate (and actually against state law) for UI employees to use those resources for the commercial benefit of a private company.
Where the invention is made with federal funding to the UI, the federal Bayh-Dole Act vests title to the invention in the UI as the funding recipient.
Similarly, most other foundation-based grants and corporate sponsored research agreements impose obligations on the UI to disclose, option, license, and commercialize any inventions resulting from those funding opportunities.
What can I do?
If your consulting agreement requires you to assign inventions to the company, you must include the full University-required paragraph before you sign the agreement.
If the University becomes aware that you have assigned intellectual property without the required language, the UI will notify the company that you did not have authority to sign the agreement.
Are there instances where I can assign an invention to the company?
- Where the invention is not made with significant use of UI resources
- Where the invention is not within the scope of your UI employment
- Where you are only advising on technology already owned by the company
- Where assignment does not conflict with UI obligations to third parties
Examples include service on a Data Safety Monitoring Board or a Scientific Advisory Board.
Liability / Indemnification
Because you are entering the agreement in your individual capacity, you are personally responsible for any liability you accept.
Restrictions on Competition / Exclusivity
Consulting agreements often include non-compete or exclusivity clauses that may restrict your future research and consulting activities.
Restrictions on Research in Same Field
Consulting agreements may restrict your ability to conduct research in the same field.
Scope of Work
The scope of work should be clearly defined and should avoid overlap with University research.
Term and Termination of Agreement
Consulting agreements often lack an end date or provide termination rights only to the company.
Use of UI Resources
The agreement should not obligate you to use UI resources beyond incidental use of phone/email/computer.
Use of Name (Yours / University’s)
The agreement should not require use of your name or the university’s name in a way that implies endorsement.
https://policy.uiowa.edu/community-policies/use-university-name
The above list identifies common issues that may or may not be present in your consulting agreement. The list is not exhaustive and is provided to assist you in reviewing your agreement.
Employees of UI Health Care must follow the Conflict of Interest / Conflict of Commitment Regarding Interactions with Industry policy:
https://uihc.org/conflict-interest-policy
If you have a VA appointment or are an HHMI investigator, consult those institutions regarding their consulting processes.