Hidden innovations: Why 1 in 4 employees keep inventions secret from their employers

A recent study from the Coller School of Management at Tel Aviv University sheds light on a significant issue facing modern businesses: workers withholding their inventions from their employers.

The study found that 27% of workers have deliberately concealed at least one innovation, with 30% of that group intending to use those ideas after leaving their organization. Employment contracts and laws typically grant companies ownership of inventions thought up by employees.

This trend poses serious risks for businesses, especially in sectors where innovation is crucial. Dr. Sarit Erez, who led the research together with Prof. Yaniv Shani and Prof. Abraham Carmeli, said that deeper investigation into the implications of this behavior is called for, as is the development of solutions.

The research involved an online study that targeted people working in innovation-driven sectors like the scientific industry, engineering, and mathematics. “We pre-screened participants, and if their work didn’t require innovation, we didn’t include them in the further questioning,” Erez told The Media Line. Participants were asked if they had ever withheld an invention and why, allowing researchers to gain insight into the underlying reasons for this behavior.

Intellectural property

Erez’s inspiration for the study stemmed from her extensive experience in intellectual property litigation.

“I was a lawyer for 22 years. In that time, I encountered many cases where employees were accused of withholding inventions—often after they left their employer and started a new job or their own firm,” she said. “I thought the legal field wasn’t the best approach. Instead, I believed management strategies could encourage employees to want to disclose their inventions.”

Shani told The Media Line that personal as well as organizational factors can influence this behavior.

“From a personal perspective, employees develop a psychological ownership over their inventions and feel emotionally attached to them,” he said. “As such, they might develop the view that the benefits and pride associated with their inventions should belong to them, despite the law and rules dictating otherwise.”

On the organizational side, many companies rely too heavily on legal agreements without considering the need for a supportive environment, Shani said.

“They often overlook the need to design and enact the social and economic motive system that would encourage employee-inventors not to withhold but rather to proactively disclose their inventions,” he explained.

Employees may also feel that the rewards for disclosing their inventions are not enough compared to the potential value of the idea.

“Employees want to benefit from their own ingenuity,” Erez said. “While companies may offer nominal rewards—like a $1,000 bonus or a plaque—employees often believe the company stands to gain far more from their idea.” This imbalance leads some employees to withhold their invention and later use it for personal gain or leverage in future employment.

Carmeli said that legal frameworks alone are not sufficient to address this behavior.

“The findings that about a quarter of employee-inventors are withholding their inventions speaks loudly that organizations should go beyond the sheer law towards a more behavioral approach that cares for the profound need for satisfaction of employee-inventors,” he told The Media Line.

He explained that employees who feel supported by their organizations are less likely to withhold their inventions. “When employees feel that their organization genuinely cares for them, they may develop a sense of belongingness, which will propel them to engage in behaviors that serve the whole rather than just themselves,” he said.

Erez and her colleagues said that incentive systems could also play a crucial role in encouraging disclosure.

“Organizations must put in place a formal incentive system where employee-inventors can benefit personally from their inventions,” Carmeli said, pointing to universities as one possible model.

The researchers are currently conducting additional studies to explore effective tools organizations can use to reduce the tendency to withhold inventions.