Through the concept of fair use, non-profit educational institutions may use copyright-protected materials for teaching and training without paying royalties or permission fees. However, there are not clear-cut rules for what is or is not fair educational use. Instead, there is a set of criteria (below) that must be considered when claiming fair use. Those who want to claim fair use must consider all the criteria and not meet just one or two of them. The concept of fair use is complex, making rendering decisions on whether a specific use of a copyrighted work is permissible or not difficult.
Per Section 107 of the Copyright Act , "Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include: [the four statutory factors of fair use are]:
The purpose and character of the proposed use (such as commercial versus not-for-profit, for purposes of criticism, comment, reporting, etc)
The nature of the work being used (such as factual versus creative)
The amount of the work being used (such as an entire book or a passage, but even tiny amounts can be problematic if they are considered the essence of the work)
The effect of the use upon the market for the copyrighted work (such as if you are making copies when they can readily be purchased)
There are some cool tools for evaluating fair use linked below.
While many know about fair use, it's important to understand that it is used as a defense if you are brought to trial over a copyright infringement suit and legal charges have already been assessed. W&M's Policy and Guidelines for the Use of Copyrighted Works indicates that "the responsibility for following best practices in fair use of copyrighted materials lies with individual faculty and not with any college or contracted service-provider that may provide printing and duplicating services on behalf of the College."
Another helpful resource is the Society for Cinema and Media Studies' document collection on fair use policies.