Standards of Ethical Conduct for Employees of the Executive Branch; Amendments to the Seeking Other Employment Rules
Final rule.
CFR Part: "5 CFR Part 2635"
RIN Number: "RIN 3209-AA04"
Citation: "81 FR 48687"
Page Number: "48687"
"Rules and Regulations"
SUMMARY: The
DATES: This final rule is effective
FOR FURTHER INFORMATION CONTACT:
SUPPLEMENTARY INFORMATION: On
II. Comments
The proposed rule was published on
OGE has made nine technical changes in the final rule. First, OGE added the phrase "personally and substantially" in several places within the regulation. This phrase is consistent with the statutory language at 18 U.S.C. 208(a) and is parallel to the language that is currently within the regulation. Second, in 5 CFR 2635.602, Example 1 to paragraph (a), OGE removed the phrase "who is not a public filer" to better clarify the example. Third, OGE clarified in 5 CFR 2635.602, Example 2 to paragraph (a) that the employee is not currently participating in any particular matters affecting the
III. Matters of Regulatory Procedure
Regulatory Flexibility Act
As Director of the
Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because this regulation does not contain information collection requirements that require approval of the
Unfunded Mandates Reform Act
For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 5, subchapter II), this final rule would not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of
Executive Order 13563 and Executive Order 12866
Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select the regulatory approaches that maximize net benefits (including economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rulemaking has been designated as a "significant regulatory action" although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, this rule has been reviewed by the
Executive Order 12988
As Director of the
List of Subjects in 5 CFR Part 2635
Conflict of interests, Executive Branch standards of ethical conduct, Government employees.
Approved:
Director,
Accordingly, the
PART 2635--STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE EXECUTIVE BRANCH
1. The authority citation for part 2635 continues to read as follows:
Authority: 5 U.S.C. 7301, 7351, 7353; 5 U.S.C. App. (Ethics in Government Act of 1978); E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306.
2. Subpart F of part 2635 is revised to read as follows:
Subpart F--Seeking Other Employment
Sec.
2635.601 Overview.
2635.602 Applicability and related considerations.
2635.603 Definitions.
2635.604 Recusal while seeking employment.
2635.605 Waiver or authorization permitting participation while seeking employment.
2635.606 Recusal based on an arrangement concerning prospective employment or otherwise after negotiations.
2635.607 Notification requirements for public financial disclosure report filers regarding negotiations for or agreement of future employment or compensation.
Subpart F--Seeking Other Employment
This subpart contains a recusal requirement that applies to employees when seeking non-Federal employment with persons whose financial interests would be directly and predictably affected by particular matters in which the employees participate personally and substantially. Specifically, it addresses the requirement of 18 U.S.C. 208(a) that an employee not participate personally and substantially in any particular matter that, to the employee's knowledge, will have a direct and predictable effect on the financial interests of a person "with whom the employee is negotiating or has any arrangement concerning prospective employment." See SEC 2635.402 and
(a) Applicability. (1) To ensure that an employee does not violate 18 U.S.C. 208(a), section 17 of the STOCK Act, or the principles of ethical conduct contained in
(2) An employee who is seeking employment with a person whose financial interests are not, to the employee's knowledge, affected directly and predictably by particular matters in which the employee participates personally and substantially has no obligation to recuse under this subpart. In addition, nothing in this subpart requires an employee, other than a public filer, to notify anyone that the employee is seeking employment unless a notification is necessary to implement a recusal pursuant to
Example 1 to paragraph (a):
Recently, an employee of the
Example 2 to paragraph (a):
The employee in the preceding example has been approached about an employment opportunity at the
(b) Related restrictions --(1) Outside employment while a Federal employee. An employee who is contemplating outside employment to be undertaken concurrently with the employee's Federal employment must abide by any limitations applicable to the employee's outside activities under subparts G and H of this part, including any requirements under supplemental agency regulations to obtain prior approval before engaging in outside employment or activities and any prohibitions under supplemental agency regulations related to outside employment or activities. The employee must also comply with any applicable recusal requirement of this subpart, as well as any applicable recusal requirements under subpart D or E of this part as a result of the employee's outside employment activities.
(2) Post-employment restrictions. An employee who is contemplating employment to be undertaken following the termination of the employee's Federal employment should consult an agency ethics official to obtain advice regarding any post-employment restrictions that may be applicable. The regulation implementing the Governmentwide post-employment statute, 18 U.S.C. 207, is contained in part 2641 of this chapter. Employees are cautioned that they may be subject to additional statutory prohibitions on post-employment acceptance of compensation from contractors, such as 41 U.S.C. 2104.
(3) Interview trips and entertainment. Where a prospective employer who is a prohibited source as defined in
For purposes of this subpart:
(a) Employment means any form of non-Federal employment or business relationship involving the provision of personal services by the employee, whether to be undertaken at the same time as or subsequent to Federal employment. It includes but is not limited to personal services as an officer, director, employee, agent, attorney, consultant, contractor, general partner, or trustee.
Example 1 to paragraph (a):
An employee of the
Example 2 to paragraph (a):
An employee of the
Example 3 to paragraph (a):
An employee at the
(b) An employee is seeking employment once the employee has begun seeking employment within the meaning of paragraph (b)(1) of this section and until the employee is no longer seeking employment within the meaning of paragraph (b)(2) of this section.
(1) An employee has begun seeking employment if the employee has directly or indirectly:
(i) Engaged in negotiations for employment with any person. For these purposes, as for 18 U.S.C. 208(a) and section 17 of the STOCK Act, the term negotiations means discussion or communication with another person, or such person's agent or intermediary, mutually conducted with a view toward reaching an agreement regarding possible employment with that person. The term is not limited to discussions of specific terms and conditions of employment in a specific position;
(ii) Made an unsolicited communication to any person, or such person's agent or intermediary, regarding possible employment with that person. However, the employee has not begun seeking employment if that communication was for the sole purpose of requesting a job application; or
(iii) Made a response, other than rejection, to an unsolicited communication from any person, or such person's agent or intermediary, regarding possible employment with that person.
(2) An employee is no longer seeking employment when:
(i) The employee or the prospective employer rejects the possibility of employment and all discussions of possible employment have terminated; or
(ii) Two months have transpired after the employee's dispatch of an unsolicited resume or employment proposal, provided the employee has received no indication of interest in employment discussions from the prospective employer.
(3) For purposes of this definition, a response that defers discussions until the foreseeable future does not constitute rejection of an unsolicited employment overture, proposal, or resume nor rejection of a prospective employment possibility.
Example 1 to paragraph (b):
A paralegal at the
Example 2 to paragraph (b):
An employee of the
Example 3 to paragraph (b):
The DCAA employee and the head of the contractor's accounting division in the previous example have a meeting to discuss the duties of the position that the accounting division would like to fill and the DCAA employee's qualifications for the position. They also discuss ways the DCAA employee could remedy one of the missing qualifications, and the employee indicates a willingness to obtain the proper qualifications. They do not discuss salary. The employee has engaged in negotiations regarding possible employment with the contractor.
Example 4 to paragraph (b):
An employee at the
Example 5 to paragraph (b):
The DOE employee in the previous example was recently notified that a representative of a university has viewed his profile. The employee still has not begun seeking employment with the university. Subsequently, a representative of the university contacts the employee through the online forum to inquire whether the employee would be interested in working for the university, to which he makes a response other than rejection. At this point, the employee has begun seeking employment with the university until he rejects the possibility of employment and all discussions of possible employment have terminated.
Example 6 to paragraph (b):
The DOE employee in the previous two examples receives emails from various companies in response to his online profile. He does not respond. The employee has not begun seeking employment with the companies because he has not made a response.
Example 7 to paragraph (b):
An employee of the
Example 8 to paragraph (b):
The employee in the preceding example responds by stating that she cannot discuss future employment while she is working on a project affecting the State's health care funding but would like to discuss employment with the State when the project is completed. Because the employee has merely deferred employment discussions until the foreseeable future, she has begun seeking employment with the
Example 9 to paragraph (b):
Three months prior to the end of the current administration, a political appointee at a large department receives a telephone call from the managing partner of an international law firm. The managing partner asks if the official would be interested in joining the law firm. The official says, "I am not talking to anyone about employment until I leave the Government." The official has rejected the unsolicited employment overture and has not begun seeking employment.
Example 10 to paragraph (b):
A geologist employed by the
(c) Prospective employer means any person with whom the employee is seeking employment. Where contacts that constitute seeking employment are made by or with an agent or other intermediary, the term prospective employer means:
(1) A person who uses that agent or other intermediary for the purpose of seeking to establish an employment relationship with the employee if the agent identifies the prospective employer to the employee; and
(2) A person contacted by the employee's agent or other intermediary for the purpose of seeking to establish an employment relationship if the agent identifies the prospective employer to the employee.
Example 1 to paragraph (c):
An employee of the
Example 2 to paragraph (c):
An employee pays for an online resume distribution service, which sends her resume to recruiters that specialize in her field. The online service has just notified her that it sent her resume to Software Company A and Software Company
(d) Direct and predictable effect, particular matter, and personal and substantial have the respective meanings set forth in
(e) Public filer means a person required to file a public financial disclosure report as set forth in
(a) Obligation to recuse. (1) Except as provided in paragraph (a)(2) of this section or where the employee's participation has been authorized in accordance with
(2) The employee may participate in a particular matter under paragraph (a)(1) of this section when:
(i) The employee's only communication with the prospective employer in connection with the search for employment is the submission of an unsolicited resume or other employment proposal;
(ii) The prospective employer has not responded to the employee's unsolicited communication with a response indicating an interest in employment discussions; and
(iii) The matter is not a particular matter involving specific parties.
Example 1 to paragraph (a):
A scientist is employed by the
Example 2 to paragraph (a):
An employee of the
Example 3 to paragraph (a):
A special Government employee of the
Example 4 to paragraph (a):
An employee of the
(b) Notification. An employee who becomes aware of the need to recuse from participation in a particular matter to which the employee has been assigned must take whatever steps are necessary to ensure that the employee does not participate in the matter. Appropriate oral or written notification of the employee's recusal may be made to an agency ethics official, coworkers, or a supervisor to document and help effectuate the employee's recusal. Public filers must comply with additional notification requirements set forth in
Example 1 to paragraph (b):
An employee of the
Example 2 to paragraph (b):
An employee of the
(c) Documentation. An employee, other than a public filer, need not file a written recusal statement unless the employee is required by part 2634 of this chapter to file written evidence of compliance with an ethics agreement with the
Example 1 to paragraph (c):
The General Counsel of a regulatory agency will be engaging in discussions regarding possible employment as corporate counsel of a regulated entity. Matters directly affecting the financial interests of the regulated entity are pending within the
(d) Agency determination of substantial conflict. Where the agency determines that the employee's action in seeking employment with a particular person will require the employee's recusal from matters so central or critical to the performance of the employee's official duties that the employee's ability to perform the duties of the employee's position would be materially impaired, the agency may allow the employee to take annual leave or leave without pay while seeking employment, or may take other appropriate action.
(a) Waiver. Where, as defined in
Example 1 to paragraph (a):
An employee of the
(b) Authorization by agency designee. Where an employee is seeking employment within the meaning of
Example 1 to paragraph (b):
Within the past month, an employee of the
(a) Employment or arrangement concerning employment. An employee may not participate personally and substantially in a particular matter that, to the employee's knowledge, has a direct and predictable effect on the financial interests of the person by whom he or she is employed or with whom he or she has an arrangement concerning future employment, unless authorized to participate in the matter by a written waiver issued under the authority of 18 U.S.C. 208(b)(1) or (3), or by a regulatory exemption under the authority of 18 U.S.C. 208(b)(2). These waivers and exemptions are described in
Example 1 to paragraph (a):
A military officer has accepted a job with a defense contractor that will begin six months after his retirement from military service. During the period that he remains with the Government, the officer may not participate personally and substantially in the administration of a contract with that particular defense contractor unless he has received a written waiver under the authority of 18 U.S.C. 208(b)(1).
Example 2 to paragraph (a):
An accountant has just been offered a job with the
(b) Offer rejected or not made. The agency designee for the purpose of
Example 1 to paragraph (b):
An employee of the
(a) Notification regarding negotiations for or agreement of future employment or compensation. A public filer who is negotiating for or has an agreement of future employment or compensation with a non-Federal entity must file a statement notifying an agency ethics official of such negotiation or agreement within three business days after commencement of the negotiation or agreement. This notification statement must be in writing, must be signed by the public filer, and must include the name of the non-Federal entity involved in such negotiation or agreement and the date on which the negotiation or agreement commenced. When a public filer has previously complied with the notification requirement in this section regarding the commencement of negotiations, the filer need not file a separate notification statement when an agreement of future employment or compensation is reached with the previously identified non-Federal entity. There is also no requirement to file another notification when negotiations have been unsuccessful. However, employees may want to do so to facilitate the resumption of their duties.
Example 1 to paragraph (a):
An employee of the Merit Systems Protection Board who is a public filer was in private practice prior to his Government service. He receives a telephone call from a partner in a law firm who inquires as to whether he would be interested in returning to private practice. During this initial telephone call with the law firm partner, the employee indicates that he is interested in resuming private practice. They discuss generally the types of issues that would need to be agreed upon if the employee were to consider a possible offer to serve as "of counsel" with the firm, such as salary, benefits, and type of work the employee would perform. The employee has begun negotiating for future employment with the law firm. Within three business days after this initial telephone call, he must file written notification of the negotiations with his agency ethics official.
Example 2 to paragraph (a):
The employee in the previous example also negotiates a possible contract with a publisher to begin writing a textbook after he leaves Government service. Within three business days after commencing negotiations, the employee must file written notification with his agency ethics official documenting that he is engaged in negotiations for future compensation with the book publisher.
(b) Notification of recusal. A public filer who files a notification statement pursuant to paragraph (a) of this section must file with an agency ethics official a notification of recusal whenever there is a conflict of interest or appearance of a conflict of interest with the non-Federal entity identified in the notification statement. The notification statement and the recusal statement may be contained in a single document or in separate documents.
(c) Advance filing of notification and recusal statements. When a public filer is seeking employment within the meaning of
Example 1 to paragraph (c):
An employee of the
Example 2 to paragraph (c):
An employee of the
(d) Agreement of future employment or compensation for the purposes of
[FR Doc. 2016-17553 Filed 7-25-16;
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