[Federal Register Volume 61, Number 216 (Wednesday, November 6, 1996)]
[Rules and Regulations]
[Pages 57281-57287]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28666]
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Rules and Regulations
Federal Register
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Federal Register / Vol. 61, No. 216 / Wednesday, November 6, 1996 /
Rules and Regulations
[[Page 57281]]
DEPARTMENT OF LABOR
Office of the Secretary
5 CFR Chapter XLII
29 CFR Part 0
RINs 1290-AA15, 3209-AA15
Supplemental Standards of Ethical Conduct for Employees of the
Department of Labor
AGENCY: Office of the Secretary, DOL.
ACTION: Interim rule with request for comments.
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SUMMARY: The Department of Labor, with the concurrence of the Office of
Government Ethics (OGE), is issuing an interim rule for employees of
the Department that supplements the Standards of Ethical Conduct for
Employees of the Executive Branch issued by OGE. The interim rule
designates certain components of the Department as separate agencies
for the purposes of provisions in the executive branch-wide Standards
regarding gifts from outside sources, the receipt of compensation for
teaching, speaking or writing, and fundraising in a personal capacity;
restricts the outside employment and the holding of certain financial
interests by employees of the Mine Safety and Health Administration and
by their spouses and minor children; and requires employees in the
Department's Office of the Inspector General to obtain prior approval
for outside employment. The interim rule also repeals existing
Departmental regulations governing outside employment and financial
interests of agency employees, except for a regulatory waivers
provision, and inserts in their place a cross-reference to the
executive branch-wide Standards and financial disclosure regulations,
and this interim rule.
DATES: This interim rule is effective November 6, 1996. Comments are
invited and are due by January 6, 1997.
ADDRESSES: Send comments to Robert Shapiro, Department of Labor, Room
N-2428, 200 Constitution Avenue, NW., Washington, DC 20210.
FOR FURTHER INFORMATION CONTACT:
David Apol, Office of the Solicitor, Department of Labor, telephone
202-219-8065, FAX 202-219-6896.
SUPPLEMENTARY INFORMATION:
I. Background
On August 7, 1992, the Office of Government Ethics published a
final rule entitled ``Standards of Ethical Conduct for Employees of the
Executive Branch'' (Standards). See 57 FR 35006-35067, as corrected at
57 FR 48557, 57 FR 52583, and 60 FR 51667, with additional grace period
extensions at 59 FR 4779-4780, 60 FR 6390-6391, 60 FR 66857-66858, and
61 FR 40950-40952. The Standards, codified at 5 CFR part 2635 and
effective February 3, 1993, establish uniform standards of ethical
conduct that apply to all executive branch personnel.
On June 23, 1994, the Department issued a final rule which removed
all of the provisions of its Ethics and Conduct Regulations at 29 CFR
Part 0 that had been superseded by 5 CFR part 2635 or by OGE's
executive branch financial disclosure regulations at 5 CFR part 2634.
See 59 FR 32611. The Department preserved those provisions of its
Ethics and Conduct Regulations containing regulatory waivers issued
under 18 U.S.C. 208(b)(2), restricting the acquisition or holding of
certain financial interests, and requiring prior approval of outside
employment or activities. These provisions were permitted to continue
in effect until superseded, as provided respectively in 5 CFR
2635.402(d)(1) and the notes following 5 CFR 2635.403(a) and 2635.803,
as extended by 59 FR 4779-4780, 60 FR 6390-6391, and 60 FR 66857-66858.
5 CFR 2635.105 authorizes executive branch agencies, with the
concurrence of OGE, to publish agency-specific supplemental regulations
necessary to implement their ethics programs. The Department, with
OGE's concurrence, has determined that the following supplemental
regulations, to be codified in part 5201 of new chapter XLII of 5 CFR,
are necessary to the successful implementation of the Department's
ethics program. The Department is simultaneously repealing those
provisions of the residual subpart C of its old Ethics and Conduct
Regulations at 29 CFR part 0, which are superseded upon issuance of the
Department's supplemental regulations, and is adding a single section
that provides cross-references to 5 CFR parts 2634 and 2635, as well as
to the Department's new supplemental regulations.
II. Analysis of the Regulations
Section 5201.101 General
Section 5201.101 explains that the regulations contained in the
interim rule apply to employees of the Department of Labor and are
supplemental to the executive branch-wide Standards.
Section 5201.102 Designation of Separate Agency Components
Section 5201.102 designates several of the Department's components
as separate agencies for the purposes of certain ethics provisions. The
Department has determined that those components exercise district and
separate functions. The separate agency designations will affect the
substantive ethics rules within the Department of Labor involving the
acceptance of gifts, the receipt of compensation for teaching, speaking
and writing, and the restrictions on fundraising for nonprofit
organizations in a personal capacity.
Section 2635.202(a) of the Standards prohibits an employee from
soliciting or accepting a gift from a ``prohibited source'' unless
permitted under one of the exceptions in the Standards. The separate
agency designations will affect, first, the definition of ``prohibited
source.'' The Standards of Ethical Conduct define a ``prohibited
source'' by the relationship of the source to both the responsibilities
of the employee and those of his or her employing agency. For the
purpose of identifying an employee's agency, 5 CFR 2635.203(a)
authorizes an executive department, by supplemental regulation, to
designate as a separate agency any component that exercises a distinct
and separate function. The agency designations contained in
Sec. 5201.102 are made pursuant to 5 CFR 2635.203(a).
In addition to its effect on the gift-acceptance rules, the
designation of separate agencies will affect the definition of
``agency'' for the purposes
[[Page 57282]]
of the rules governing compensation for outside teaching, speaking, and
writing. Section 2635.807 of the Standards restricts an employee's
acceptance of compensation for outside teaching, speaking, and writing
that relates to the employee's official duties, including teaching,
speaking, or writing the subject of which deals in significant part
with any ongoing or announced policy, program, or operation of the
employee's agency. See 5 CFR 2635.807(a)(2)(I)(E)(2). Under 5 CFR
2635.807(a)(2)(I)(E)(3), more restrictive rules apply to certain
noncareer employees. The separate agency designations contained in
Sec. 5201.102 mean that the compensation restrictions in 5 CFR 2635.807
apply when the subject of an employee's speech, appearance, or article
deals in significant part with any ongoing or announced policy program,
or operation of his or her own designated agency component rather than
to the Department as a whole.
Finally, Sec. 5201.102 further supplements the Standards to change
the way the restrictions on fundraising in a personal capacity apply
within the Department. Section 2635.808(c) of the Standards restricts
employees' fundraising in a personal capacity with respect to persons
who are ``prohibited sources''. Section 5201.102 provides that the
separate agency designations used to determine when a person is a
``prohibited source'' for purposes of the Standards governing direct
and indirect gifts to employees from outside sources will also be used
to determine when a person is a prohibited source for the purpose of
the Standard at 5 CFR 2635.808(c) governing fundraising in a personal
capacity.
The definition of ``prohibited source'' for employees outside the
designated agency components will not be affected by the designations.
Any source which is prohibited from any Department component will be
treated as a prohibited source for any employee who is not in one of
the designated agency components.
Because of the very distinct and diverse functions of the
Employment Standards Administration (ESA), each designated component
within ESA is treated as a separate agency for the purposes of
determining ``prohibited sources'' and the other specified provisions
of the Standards. For the remaining ESA employees, a source is
prohibited if it is a prohibited source for any component of ESA.
Section 5201.103 Fundraising Activities
Section 5201.103 of the interim rule supplements the executive
branch-wide Standard at 5 CFR 2635.808(c) regarding fundraising in a
personal capacity. That standard bars employees from engaging in such
fundraising from those persons known by the employee to be ``prohibited
sources,'' as defined in 5 CFR 2635.203(d). In Sec. 5201.102 of this
interim rule, the Department has designated certain of its components
as separate agencies for the purposes of identifying prohibited
sources.
The employees of certain of these designated agencies have very
large numbers of prohibited sources because their components exercise
very broad regulatory responsibilities. These agency components are:
the Occupational Safety and Health Administration, which regulates
safety and health in most of the nation's workplaces; the Veterans'
Employment and Training Service, which is responsible, among its other
functions, for regulating the nation's employers to assure that they
comply with their obligations under the veterans reemployment statutes;
the Pension and Welfare Benefits Administration, which regulates
private pension and welfare benefit plans under the Employee Retirement
Income Security Act; the Wage and Hour Division of the ESA, which is
responsible, among its other functions, for assuring that non-exempt
private and public sector employees are paid the Federal minimum wage;
and the Office of Federal Contract Compliance Programs in the ESA,
which assures that the very broad and diverse category of employers
performing work under Federal contracts and those who perform federally
assisted construction work meet Federal affirmative action
requirements. Officials in the ``Remainder of ESA'' participate in
regulatory activities under both the Wage and Hour and Contract
Compliance Programs, as well as certain workers' compensation programs.
Officials in the ``Remainder of the Department of Labor'' also exercise
broad regulatory responsibilities, as they participate in all of the
Department's regulatory efforts.
The Department has determined that, in light of the very broad
regulatory responsibilities of these components, barring personal
fundraising from every category of prohibited source listed in 5 CFR
2635.203(d) is not necessary to avoid the appearance of using public
office for private gain. Accordingly, in order that the personal
fundraising activities of employees in these components not be unduly
restricted, Sec. 5201.103 provides that it shall be permissible for
employees in these designated separate agency components to solicit
funds or other support from a person who is a prohibited source for
them only under 5 CFR 2635.203(d)(3), because the person is regulated
by the component. Employees of these separate agency components will
not be allowed to solicit contributions from a person known to be a
``prohibited source'' for the other reasons listed in 5 CFR
2635.203(d). Thus, they cannot engage in charitable fundraising from
any person (including an organization, a majority of whose members are
such persons) seeking official action by the employee's agency
component; doing business or seeking to do business with the employee's
agency component; or having interests that may be substantially
affected by the performance or nonperformance of the employee's
official duties.
Section 5201.104 Additional Rules for Office of the Inspector General
Employees
The Standards, at 5 CFR 2635.803, specifically recognize that
individual agencies may find it necessary or desirable to supplement
the executive branch-wide regulations with a requirement for their
employees to obtain approval before engaging in outside employment or
activities. The Department's Office of the Inspector General (OIG) has
long imposed requirements for advance approval of its employees'
outside business or professional activities. Because of the wide range
of OIG responsibilities and the sensitivity of its mission, the
Department has determined, in accordance with 5 CFR 2635.803, that it
is necessary to the administration of the ethics program to continue to
require OIG employees to get prior approval for outside employment.
Section 5201.104(a)(1) of this interim rule continues, with minor
substantive modification, the OIG's past requirement for prior approval
of outside employment. Section 5201.104(a)(2) specifies the content of
approval requests. Section 5201.104(a)(3) specifies the standards to be
used in evaluating approval requests. Section 5201.104(a)(4) provides a
definition of ``employment'' to be used in the application of
Sec. 5201.104.
Section 5201.105 Additional Rules for Mine Safety and Health
Administration Employees
5 CFR 2635.403(a) authorizes agencies, by supplemental regulation,
to
[[Page 57283]]
prohibit or restrict the acquisition or holding of a financial interest
or a class of financial interests by agency employees, based on a
determination that the acquisition or holding of such interests would
cause reasonable persons to question the impartiality and objectivity
with which agency programs are administered. Where it is necessary to
the efficiency of the service, such prohibitions or restrictions may be
extended to employees' spouses and minor children.
Section 5201.105(a) of the interim rule generally bars employees of
the Department's Mine Safety and Health Administration (MSHA), and
their spouses and minor children, from having outside employment with
any company or other person engaged in mining activities regulated by
the MSHA under the Federal Mine Safety and Health Act of 1977 (Mine
Safety and Health Act), 30 U.S.C. 801 et seq., and from holding other
financial interests in such companies or other persons. The MSHA has
restricted the holding of mining interests by its employees since the
mine safety and health programs were transferred from the Department of
the Interior to the Department of Labor by the Federal Mine Safety and
Health Amendments Act of 1977, Pub. L. 95-164. Section 301(c)(2) of
that Act, codified at 30 U.S.C. 961(c)(2), provided that existing rules
of the Department of the Interior regarding the transferred mine safety
and health program were to continue in effect until modified,
terminated, superseded, set aside, revoked, or repealed by the
Secretary of Labor, the Federal Mine Safety and Health Review
Commission or other authorized officials, by any court of competent
jurisdiction, or by operation of law. Prior to the transfer, the
Department of the Interior's regulations in 1976 (43 CFR 20.735-13)
broadly prohibited employees of the Mining Enforcement and Safety
Administration (MESA) from holding mining interests and engaging in
certain forms of outside employment. The substantive restrictions have
not been changed since the transfer and are in effect until this
interim rule takes effect, in accordance with 59 FR 32611.
These regulations prohibited MESA (and later MSHA) employees from
having any direct or indirect interests in any mine or the products of
any mine under investigation. They also prohibited certain private
employment in relation to mines or mineral property. The Department has
determined that in light of the sensitive mission of the MSHA involving
the application of safety and health standards to the entities that it
regulates, restrictions on outside employment and on employee ownership
of financial interests in mining entities are necessary in order to
maintain public confidence in the impartiality and objectivity with
which the MSHA executes its various functions and to avoid widespread
disqualification of employees from their duties which could result in
MSHA having difficulty carrying out its mission. With respect to the
spouses and minor children of these MSHA employees, the Department has
made an additional determination that there is a direct and appropriate
nexus between the restrictions on the holding of certain employment and
financial interests as applied to spouses and minor children, and the
ability of MSHA employees to carry out their official duties and the
ability of MSHA to fulfill its mission.
The prohibitions in Sec. 5201.105(a) apply to employment or other
financial interests in a company not primarily engaged in mining
activities, if it conducts some mining activities regulated by the MSHA
under the Mine Safety and Health Act. Consistent with the definition of
``person'' in the Standards at 5 CFR 2635.102(k), Sec. 5201.105(a)
specifies that a non-mining company which owns 50 percent or more of
the voting securities of another company or other person engaged in
covered mining activities is itself treated as a company engaged in
such mining activities. This prevents the employee from avoiding these
restrictions by having an interest in a company that conducts its
mining operations through a separate corporation. On the other hand,
this section supplements the definition of ``person'' in the Standards
at 5 CFR 2635.102(k), by allowing employees to hold interests in a non-
mining corporation that is controlled by a mining corporation. The
Department has determined that the provisions of the conflict of
interest laws and the Standards are sufficient to protect the public
interest in such a case.
Section 5201.105(b) includes two exceptions to the prohibition of
5201.105(a). The exceptions are intended to permit ownership of
interests of a character that are less likely to raise questions
regarding the objective and impartial performance of an employee's
official duties or the possible misuse of their positions.
The interim rule contains an exception at Sec. 5201.105(b)(1)
permitting covered persons to hold interests in publicly traded or
publicly available investment funds, unless the fund holds more than 30
percent of its investments in the prohibited holdings.
The exception at Sec. 5201.105(b)(2) permits the holding of pension
interest. Disqualifications due to conflicts of interest from pension
interest are rare; moreover, when there is a disqualifying conflict of
interest due to a pension interest, nonparticipation in a particular
matter affecting the interest will sufficiently address the conflict
issue. It is expected that such disqualifications will be infrequent
and, therefore, will not disturb the Department's ability to carry out
its mission.
Finally, requiring divestiture of pension interests could adversely
affect MSHA's ability to carry out its statutory responsibilities. The
Federal Mine Safety and Health Act requires that those hired to perform
various MSHA functions must be qualified by practical experience or
education. For this reason, it is likely that both current employees
and applicants will have a prior work history in the mining industry
and may have interests in the pension plans of their former employers.
Many of these interests are difficult to divest. Requiring divestiture,
even in the absence of a conflict of interest, would discourage the
hiring and retention of persons possessing the qualifications that the
Mine Safety and Health Act requires.
Under Sec. 5201.105(c), the Assistant Secretary of Labor for Mine
Safety and Health, or the Assistant Secretary's designee, may grant a
waiver covering an outside employment or other financial interest when
the Assistant Secretary or the designee determines that the waiver is
not inconsistent with 5 CFR part 2635 or otherwise prohibited by law
and that, under the particular circumstances, application of the
prohibition is not necessary to avoid the appearance of misuse of
position or loss of impartiality, or to ensure confidence in the
impartiality and objectivity with which Mine Safety and Health
Administration programs are administered. The Assistant Secretary or
the designee shall grant a waiver from prohibitions in this section
regarding spouses and minor children unless the Assistant Secretary or
the designee determines that having the covered relationship or
interest is likely to be inconsistent with 5 CFR part 2635 or is
otherwise prohibited by law.
Section Sec. 5201.105(d) provides that existing waivers, issued
under the Department's old regulations and procedures implementing the
mining interest prohibition applicable to MSHA employees, remain in
effect but may be withdrawn subject to the standards applicable to the
withdrawal of waivers under paragraph (c).
[[Page 57284]]
III. Repeal of Department of Labor Standards of Conduct
On June 23, 1994, The Department of Labor, at 59 FR 36210-36211,
removed and reserved subparts A, B, D, and E and portions of subpart C
of 29 CFR part 0, Ethics and Conduct Department of Labor Employees. The
Department retained in subpart C Sec. 0.735-12(d) (now being
redesignated as Sec. 0.735-2), which contains a regulatory waiver
issued under the prior version of 18 U.S.C. 208(b)(2) (1988) and which
has remained in effect pending OGE's issuance of superseding executive
branch-wide regulatory waivers. It also amended and retained in subpart
C grandfathered Sec. 0.735-13, regarding prohibited financial interests
and clearance of outside activities. The interim rule repeals
Sec. 0.735.13, which is superseded upon issuance of this interim rule.
The interim rule adds a new provision to ensure that employees are
on notice of the ethical standards and other ethics provisions to which
they are subject. The provision cross-references 5 CFR parts 2634,
2635, and 5201. It is included along with the regulatory waiver
provision in a revised subpart A.
The provisions dealing with post employment conflicts of interest
which are now in subpart F are transferred to the currently reserved
subpart B. These provisions establish administrative procedures to
sanction former Department of Labor employees who have violated 18
U.S.C. 207. While the authority to impose the administrative sanctions
was repealed prospectively by the Ethics Reform Act of 1989, the
procedures continue to apply to persons whose government service
terminated while they were still in effect. For this reason the
administrative sanction provisions are being retained for the present.
To simplify the structure of part 0, the remaining vacant or
currently reserved subparts are being deleted.
IV. Matters of Regulatory Procedure
Administrative Procedure Act
As Secretary of Labor, I have found good cause pursuant to 5 U.S.C.
553 (a)(2), (b), and (d)(3) for waiving, as unnecessary and contrary to
the public interest, the general notice of proposed rulemaking and the
60-day delay in effectiveness as to these interim rules and repeals.
The reason for this determination is that it is important to a smooth
transition from the Department of Labor's prior ethics rules to the new
executive branch-wide Standards that these rulemaking actions become
effective as soon as possible. Furthermore, this rulemaking is related
to the Department's organization, procedure and practice. Nonetheless,
this is an interim rulemaking, with provision for a 60 day public
comment period. The Department will review all comments received during
the comment period and will consider any modifications that appear
appropriate in adopting these rules as final, with the concurrence of
the Office of Government Ethics.
Executive Order 12866, Regulatory Planning and Review
As Secretary of Labor, I have determined that this regulation is
not a ``regulatory action'' under section 3 of Executive Order 12866.
Because the rule is limited to agency organization, management and
personnel, it falls within the exclusion set forth in section 3(d)(3)
of the Executive order. In promulgating this rule, the Department has
adhered to the regulatory philosophy and the applicable principles of
regulation set forth in section 1 of the Executive order.
Small Business Regulatory Fairness Act of 1996
This rule is not classified as a ``rule'' under the Small Business
Regulatory Fairness Act of 1996, because it is a rule pertaining to
agency organization, procedure, or practice that does not substantially
affect the right of non-agency parties. See 5 U.S.C. 804(3)(C).
Moreover, as Secretary of Labor, I have found for the good cause set
forth above, that notice and public procedure thereon are unnecessary
and contrary to the public interest. See 5 U.S.C. 808(2). Accordingly,
this interim regulation will take effect on November 6, 1996.
Regulatory Flexibility Act
As Secretary of Labor, I certify under the Regulatory Flexibility
Act (5 U.S.C. chapter 6) that this regulation will not have significant
economic impact on a substantial number of small entities because it
imposes ethics standards only on Federal employees and their immediate
families. The Secretary of Labor has provided this certification to the
Chief Counsel for Advocacy of the Small Business Administration.
Paperwork Reduction Act
As Secretary of Labor, I have determined that the Paperwork
Reduction Act (44 U.S.C. chapter 35) does not apply because this
regulation does not contain any information collection requirements
that require the approval of the Office of Management and Budget
thereunder.
List of Subjects in 5 CFR Part 5201 and 29 CFR Part 0
Conflict of interests, Government employees.
Dated: October 31, 1996.
Robert B. Reich,
Secretary of Labor.
Approved: November 4, 1996.
Steven D. Potts,
Director, Office of Government Ethics.
Accordingly, for the reasons set forth in the preamble, the
Department of Labor, with the concurrence of the Office of Government
Ethics, is amending title 5 and title 29, subtitle A, of the Code of
Federal Regulations as follows:
TITLE 5--[AMENDED]
1. A new chapter XLII, consisting of part 5201, is added to 5 CFR
to read as follows:
CHAPTER XLII--DEPARTMENT OF LABOR
PART 5201--SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES
OF THE DEPARTMENT OF LABOR
Sec.
5201.101 General.
5201.102 Designation of separate agency components.
5201.103 Fundraising activities.
5201.104 Additional rules for Office of the Inspector General
employees.
5201.105 Additional rules for Mine Safety and Health Administration
employees.
Authority: 5 U.S.C. 301, 7301, 7353; 5 U.S.C. App. (Ethics in
Government Act); 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; 5
CFR 2635.105, 2635.203(a), 2635.403(a), 2635.803.
Sec. 5201.101 General.
In accordance with 5 CFR 2635.105, the regulations in this part
apply to employees of the Department of Labor (Department) and
supplement the Standards of Ethical Conduct for Employees of the
Executive Branch contained in 5 CFR part 2635.
Sec. 5201.102 Designation of separate agency components.
(a) Separate agency components of the Department of Labor. Pursuant
to 5 CFR 2635.203(a), each of the ten components of the Department
listed below is designated as an agency separate from each of the other
nine listed components and, for employees of that component, as an
agency distinct from the remainder of the Department. However, the
components listed below are not deemed to be separate agencies for
purposes of applying any provision of 5 CFR part 2635 or this part to
[[Page 57285]]
employees of the remainder of the Department:
(1) Benefits Review Board;
(2) Employees Compensation Appeals Board;
(3) Mine Safety and Health Administration (MSHA);
(4) Veterans' Employment and Training Service;
(5) Occupational Safety and Health Administration (OSHA);
(6) Pension and Welfare Benefits Administration (PWBA);
(7) Bureau of International Labor Affairs;
(8) Bureau of Labor Statistics;
(9) Employment and Training Administration (ETA); and
(10) Employment Standards Administration (ESA).
(b) Separate agency subcomponents of ESA. Pursuant to 5 CFR
2635.203(a), each of the four subcomponents of the Employment Standards
Administration (ESA) listed in this paragraph is designated as an
agency separate from each of the other three listed components and, for
employees of that subcomponent, as an agency distinct from the
remainder of ESA. However, the components listed in this paragraph are
not deemed to be separate agencies for purposes of applying any
provision of 5 CFR part 2635 or this part to employees of the remainder
of ESA:
(1) Wage and Hour Division;
(2) Office of Federal Contract Compliance Programs;
(3) Office of Workers Compensation Programs; and
(4) Office of Labor-Management Standards.
(c) Definitions. (1) Remainder of the Department means employees in
the Office of the Secretary and any other employee of the Department
not in one of the 10 components designated as separate agencies in
paragraph (a) of this section.
(2) Remainder of ESA means employees in the Office of the Assistant
Secretary for Employment Standards and any other ESA employee not in
one of the four subcomponents designated as separate agencies in
paragraph (b) of this section.
(d) Applicability of separate agency designations. The designations
in paragraphs (a) and (b) of this section identify an employee's
``agency'' for purposes of:
(1) Determining when a person is a prohibited source within the
meaning of 5 CFR 2635.203(d) for purposes of applying the regulations
at subpart B of 5 CFR part 2635 governing gifts from outside sources;
(2) Determining whether teaching, speaking or writing relates to
the employee's official duties within the meaning of 5 CFR
2635.807(a)(2)(i); and
(3) Determining when a person is a prohibited source for purposes
of applying the regulations at 5 CFR 2635.808(c) governing fundraising
in a personal capacity.
Example 1: An employee of the Mine Safety and Health Administration
attends a Saturday football game together with an employee of the
Office of the Solicitor. By coincidence, they are seated next to a
contract consultant to the Employment and Training Administration. They
talk about the game and describe their jobs and personal interests to
their new seat-mate. The consultant states that he and his wife will
not be able to attend next week's game and would like to give their
very expensive tickets to people who will really enjoy them. The MSHA
employee may accept the ticket. MSHA is designated as a separate agency
under Sec. 5201.102, and the ETA contractor is not a prohibited source
of gifts for MSHA employees. The contractor is not regulated by and has
no business dealings with MSHA. The Solicitor's Office employee may not
accept the gift. The ETA contractor is a prohibited source for
Solicitor's Office employees because the Solicitor's Office is a part
of the ``Remainder of the Department of Labor.'' Any source which is
prohibited for any component of the Department of Labor is a prohibited
source for employees in the ``Remainder.''
Sec. 5201.103 Fundraising activities.
Notwithstanding 5 CFR 2635.808(c)(1)(i), an employee of any
separate agency component listed in this section may, in a personal
capacity, personally solicit funds from a person who is a prohibited
source if person is a prohibited source for employees of the component
only under 5 CFR 2635.203(d)(3) because the person conducts activities
regulated by the component:
(a) The Wage and Hour Division;
(b) The Office of Federal Contract Compliance Programs;
(c) The Remainder of the Employment Standards Administration, as
defined in Sec. 5201.102(c);
(d) Occupational Safety and Health Administration;
(e) Pension and Welfare Benefits Administration;
(f) Veterans' Employment and Training Service; and
(g) The Remainder of the Department of Labor, as defined in
Sec. 5201.102(c).
Example 1: A training official in the Mine Safety and Health
Administration is president of the local branch of her college alumni
association. The association is seeking used computers from local
businesses to upgrade the college's language lab. The employee may not
seek a contribution from the vice president of a mining company which
is regulated by MSHA. Even though the mining company is not currently
under investigation, it is a prohibited source for the employment
because it is subject to MSHA regulation and MSHA is not one of the
agency components designated as separate for the purpose of fundraising
in a personal capacity.
Example 2: A typist in the Pension and Welfare Benefits
Administration raises money for a local homeless shelter during his
off-duty hours. He may seek a contribution from a firm that is
regulated by PWBA under the Employee Retirement Income Security Act but
may not seek contributions from one that he knows is currently under
investigation for a violation of the Act. While firms regulated by an
agency would ordinarily be prohibited sources for purposes of an
employee's fundraising in a personal capacity, Sec. 5201.103 provides
that employees of PWBA and the other separate agency components listed
in that section may seek charitable contributions from an entity that
is a prohibited source only because its activities are subject to
regulation by that separate agency component. On the other hand, the
employee may not engage in fundraising from a person who he knows is a
prohibited source for any other reason, such as an ongoing enforcement
action.
Example 3: An employee of the Employment and Training
Administration may seek charitable contributions from a firm currently
under investigation by the Occupational Safety and Health
Administration (OSHA). ETA does not regulate this firm and has had no
dealings or business with it of any kind. Since ETA has been designated
as a separate agency under Sec. 5201.102, ETA employees need only
consider their own official duties and activities and those of ETA in
determining whether a person is a prohibited source for purposes of
their fundraising in a personal capacity. The fact that a person may be
a prohibited source of direct and indirect gifts for OSHA employees is
not relevant in this instance.
Sec. 5201.104 Additional rules for Office of the Inspector General
employees.
The rules in this section apply to employees of the Office of the
Inspector General (OIG) and are in addition to Secs. 5201.101,
5201.102, and 5201.103.
(a) Prior approval for outside employment. (1) Before engaging in
any
[[Page 57286]]
outside employment, an OIG employee must obtain the written approval of
the Inspector General or the Inspector General's designee.
(2) Submission of requests for approval. (i) Requests for approval
shall be submitted in writing to the Inspector General or the Inspector
General's designee. Such requests shall include, at a minimum, the
following:
(A) The employee's name and position title;
(B) The name and address of the person, group, or organization for
whom the employee proposes to engage in outside employment; and
(C) A description of the proposed outside employment, including the
duties and services to be performed while engaged in the outside
employment, and the approximate dates of the outside employment.
(ii) Together with the employee's request for approval, the
employee shall provide a certification that:
(A) The outside employment will not depend in any way on nonpublic
information, as defined at 5 CFR 2635.703(b);
(B) No official duty time or Government property, resources, or
facilities not available to the general public will be used in
connection with the outside employment; and
(C) The employee has read and is familiar with the Standards of
Ethical Conduct for Employees of the Executive Branch (5 CFR part
2635), including subpart H. (``Outside Activities''), and the
Department's supplemental standards of ethical conduct set forth in
this part.
(iii) Upon a significant change in the nature or scope of the
outside employment or in the employee's official position, the employee
shall submit a revised request for approval.
(3) Standard for approval. Approval shall be granted only upon a
determination that the outside employment is not expected to involve
conduct prohibited by statute or Federal regulation, including 5 CFR
part 2635 and this part.
(4) Definitions. For purposes of this section, ``employment'' means
any form of non-Federal employment or any business relationship
involving the provision of personal services by the employee. It
includes but is not limited to personal services as an officer,
director, employee, agent, attorney, consultant, contractor, general
partner, or trustee.
Sec. 5201.105 Additional rules for Mine Safety and Health
Administration employees.
The rules in this section apply to employees of the Mine Safety and
Health Administration (MSHA) and are in addition to Secs. 5201.101,
5201.102, and 5201.103.
(a) Prohibited financial interests. Employees in the MSHA and their
spouses and minor children are prohibited from having any financial
interests (including compensated employment) in any company or other
person engaged in mining activities subject to the Federal Mine Safety
and Health Act of 1977 (Mine Safety and Health Act), 30 U.S.C. 801 et
seq. A company or other person shall be deemed to be engaged in such
mining activities if it owns 50 percent or more of the voting
securities of another company or other person engaged in such mining
activities. A company or other person shall not be deemed to be engaged
in such mining activities solely because it is controlled by a company
or other person which does engage in such activities.
(b) Exceptions. (1) Nothing in this section prohibits an employee
or the spouse or minor child of an employee from acquiring, owning or
controlling an interest in a publicly traded or publicly available
investment fund provided that, upon initial or subsequent investment by
the employee (excluding ordinary dividend reinvestment), the fund does
not have invested, or does not indicate in its prospectus the intent to
invest, more than 30 percent of its assets in the securities of a
company or other person engaged in mining activities subject to the
Mine Safety and Health Act, and the employee, spouse, or minor child
neither exercises control nor has the ability to exercise control over
the financial interests held in the fund.
(2) Nothing in this section prohibits an employee or the spouse or
minor child of an employee from having a financial interest in a
pension administered by, or which invests in, a company or other person
engaged in mining activities subject to the Mine Safety and Health Act.
Example: A mine inspector who was a former employee of mining
company X could continue to participate in mine company X's pension
plan without violating this section. However, he would have to disclose
the interest on his financial disclosure report. Additionally, the
inspector should not inspect or otherwise take official action on a
matter affecting mine company X without checking with his ethics
advisor to ensure that performance of his official duties would not
violate the conflict of interest statute (18 U.S.C. 208) or any other
ethics provisions.
(c) Waiver. (1) The Assistant Secretary of labor for Mine Safety
and Health or the Assistant Secretary's designee may grant an employee
a written waiver from the prohibitions contained in paragraph (a) of
this section, based on a determination that the waiver is not
inconsistent with 5 CFR part 2635 or otherwise prohibited by law and
that, under the particular circumstances, application of the
prohibition is not necessary to avoid the appearance of misuse of
position or loss of impartiality, or to ensure confidence in the
impartiality and objectivity with which Mine Safety and Health
Administration programs are administered.
(2) The Assistant Secretary or the designee shall grant a waiver
from the prohibitions in paragraph (a) of this section regarding
spouses and minor children unless the Assistant Secretary or the
designee determines that the covered relationship or interest is likely
to be inconsistent with 5 CFR part 2635 or is otherwise prohibited by
law.
(3) A waiver under this section may be accompanied by appropriate
conditions, such as requiring execution of a written statement of
disqualification. A waiver may be withdrawn if it is later determined
that such waiver does not meet the requirements for the granting of
waivers under this paragraph. Notwithstanding the grant of any waiver,
a covered employee remains subject to the disqualification requirements
of 5 CFR 2635.402 and 2635.502.
(4) Factors which may be considered in connection with the granting
or denial of waivers include the nature and extent of the financial
interest, and the official position and duties of the employee.
(d) Pre-existing interests. Notwithstanding paragraph (a) of this
section, an employee of the Mine Safety and Health Administration, and
a spouse or minor child of such an employee, may retain financial
interests otherwise prohibited by paragraph (a) of this section which
were approved in writing under procedures in effect before the
effective date of this section, unless the approval is withdrawn,
subject to the standards applicable to the withdrawal of waivers under
paragraph (c) of this section.
TITLE 29--[AMENDED]
Subtitle A--Office of the Secretary of Labor
PART 0--[AMENDED]
2. The authority citation for part 0 is revised to read as follows:
Authority: 5 U.S.C. 301; 5 U.S.C. App. (Ethics in Government Act
of 1978); sec. 501, Pub. L. 95-521, 92 Stat. 1866-1867; 18 U.S.C.
[[Page 57287]]
208; 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; 5 CFR part
2634, part 2635.
3. Part 0 is amended by removing subparts A, B, D, and E, by
removing Sec. 0.735-13, and by redesignating subpart F as subpart B and
removing its authority citation.
4. Part 0 is further amended by redesignating subpart C as subpart
A and by revising its heading to read ``Subpart A--Standards of Conduct
for Current Department of Labor Employees.''
5. Part 0 is further amended by redesignating Sec. 0.735-12 as
Sec. 0.735-2 and adding Sec. 0.735-1 to read as follows:
Sec. 0.735-1 Cross-references to employee ethical conduct standards
and financial disclosure regulations.
Employees of the Department of Labor (Department) are subject to
the executive branch-wide standards of ethical conduct at 5 CFR part
2635, the Department's regulations at 5 CFR part 5201 which supplement
the executive branch-wide standards, and the executive branch financial
disclosure regulations at 5 CFR part 2634.
[FR Doc. 96-28666 Filed 11-5-96; 8:45 am]
BILLING CODE 4510-23-M
