[Federal Register Volume 61, Number 63 (Monday, April 1, 1996)]
[Notices]
[Pages 14326-14328]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-7661]



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OFFICE OF GOVERNMENT ETHICS


Revocation of Post-Employment Waiver

AGENCY: Office of Government Ethics (OGE).

ACTION: Notice; revocation of waiver.

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SUMMARY: The Office of Government Ethics is giving notice of the 
termination, effective in three months, of a short-term post-Government 
employment waiver of certain ``senior employee'' restrictions it 
granted earlier this year to position holders in Senior Executive 
Service (SES) level 4. At the time the waiver was issued, OGE indicated 
that it was only a temporary measure to allow affected employees, their 
agencies and OGE itself adequate notice of, and time to respond to, the 
otherwise sudden imposition of certain senior employee restrictions as 
a result of 1996 increases to rates of basic pay.

EFFECTIVE DATE: July 1, 1996.

ADDRESSES: Copies of the OGE materials discussed in the Supplementary 
Information section below may be obtained, without charge, by 
contacting William E. Gressman, Office of Government Ethics, Suite 500, 
1201 New York Avenue, NW., Washington, DC 20005-3917. The materials are 
also available on OGE's electronic bulletin board TEBBS (``The Ethics 
Bulletin Board Service''). Information regarding TEBBS may also be 
obtained from Mr. Gressman.

FOR FURTHER INFORMATION CONTACT: Mr. Gressman at OGE, telephone: 202-
523-5757, ext. 1110; FAX: 202-523-6325.

SUPPLEMENTARY INFORMATION: On January 4, 1996, pursuant to its 
authority under 18 U.S.C. 207(c)(2)(C), the Office of Government Ethics 
granted a temporary waiver, effective until June 30, 1996, from the 
``senior employee'' post-Government employment restrictions of 18 
U.S.C. 207(c) and consequently subsection (f) to a specified group of 
executive branch employees. Under 5 CFR 2641.201(d) of OGE's post-
employment regulations, a position waiver (exemption) determination is 
not required to be published in the Federal Register (the January 4, 
1996 waiver determination was not published in the Federal

[[Page 14327]]
Register but was disseminated at that time to the executive branch 
departments and agencies.) Rather, there is provision for publication 
of any needed annual update to the compilation of exempted positions or 
categories of positions in appendix A to part 2641 (no update has been 
published thus far in 1996). Moreover, 90-day advance notice of any 
revocation of a position waiver, such as is being done in this 
document, is required to be published in the Federal Register.
    The group of employees granted the waiver last January was 
constituted of all executive branch employees whose rate of basic pay 
on December 28, 1995 was less than the rate of basic pay payable for 
level V of the Executive Schedule and who as a direct result of 
Executive Order 12984, or any other Executive order or statute the 
terms of which are tied to the pay raise effected through that 
Executive order, would have their basic rate of pay increased to an 
amount equal to or greater than the rate of basic pay for level V of 
the Executive Schedule and whose position would then be described in 18 
U.S.C. 207(c)(2)(A)(ii). See OGE's January 4, 1996 Memorandum (# DO-96-
001) to heads of agencies, designated agency ethics officials and 
inspectors general.
    On December 28, 1995, President Clinton signed Executive Order 
12984, ``Adjustments of Certain Rates of Pay and Allowances.'' See 61 
FR 237-246 (part III of the January 3, 1996 issue), as amended by E.O. 
12990 of February 29, 1996 as to the uniformed services (see 61 FR 
8467-8470 (March 5, 1996 issue)). Under Executive Order 12984, one 
effect of the pay raise, which was to take effect as early as January 
7, 1996, was to make the rate of basic pay for Senior Executive Service 
level 4 (ES-4), at $109,400 per year, greater than the rate of basic 
pay for level V of the Executive Schedule, at $108,200 per year (the 
latter not having been increased since January 1993).
    Thus, under the definitional provisions of the post-Government 
employment conflict of interest statute, 18 U.S.C. 207(c)(2)(A)(ii), 
employees at SES level 4, without any accretion in duties or 
responsibilities, were to become ``senior employees'' for purposes of 
section 207 and hence subject to more restrictive post-employment 
prohibitions. The ES-4 employees, the significantly large middle level 
of the SES who represent over 40% of the SES workforce, would thus have 
quickly become subject to the one-year ``cooling off'' restrictions at 
section 207(c) and the foreign entities restrictions at section 207(f), 
which apply to, inter alia, persons subject to section 207(c) 
restrictions. Further, this development was unrelated to the purposes 
underpinning the more restrictive post-employment prohibitions for 
higher-level ``senior employees.'' Instead, the impact on SES level 4 
positions arose only from the combined effect of the Congressional 
freeze on Executive Schedule level V basic pay and E.O. 12984, and not 
an increase in level of responsibility.
    Under 18 U.S.C. 207(c), a former ``senior employee'' of the 
executive branch is prohibited from making certain communications or 
appearances of behalf of another before an employee of a department or 
agency in which the former senior employee served in any capacity 
during the one-year period prior to his termination from a ``senior'' 
position. In addition, under 18 U.S.C. 207(f), for one year after 
service in a ``senior'' position terminates, no ``senior employee'' may 
knowingly, with the intent to influence a decision of an employee of a 
department or agency of the United States in carrying out his official 
duties, represent a foreign entity before any department or agency of 
the United States or aid or advise a foreign entity (defined as a 
government of a foreign country or a foreign political party). See the 
OGE Memorandum of December 19, 1995 (# DO-95-045) to designated agency 
ethics officials.
    In its January 4, 1996 Memorandum, OGE noted that new post-
employment restrictions have historically not taken effect without some 
notice to employees and agencies. Such notice permits employees to make 
any needed career adjustments and also allows agencies to plan for any 
resultant personnel changes. Last January, the very brief time frames 
of the impending pay and consequent post-employment changes, 
exacerbated by the extensive furloughs then prevailing, resulted in 
very little, if any, effective notice to affected employees and 
agencies. In these circumstances, OGE determined that the grant of a 
six-month waiver for the about-to-be newly affected employees, the SES 
level 4 incumbents, across the entire executive branch was appropriate.
    In a related development, the White House Counsel, at the direction 
of the President, informed all executive departments and agencies in a 
January 5, 1996 Memorandum that Executive Order 12834 on post-
employment ethics pledges for certain senior officials did not apply to 
employees paid at level 4 of the SES. See OGE's January 11, 1996 
Memorandum (# DO-96-002) to designated agency ethics officials 
forwarding a copy of the White House Memorandum.
    The Office of Government Ethics had three reasons for granting the 
January 4, 1996 short-term post-employment waiver. First, as noted, the 
six-month waiver period granted was intended to give affected employees 
fair notice of the otherwise sudden imposition of the section 207 (c) 
and (f) restrictions (the exemption will become permanent as to any 
such employee who leaves a senior employee position covered by the 
waiver before the waiver terminates on July 1, 1996). Second, this 
grace period, which continues through the end of June of this year, 
allows executive branch departments and agencies time, in addition to 
other personnel planning, to consider and prepare, if appropriate, 
requests for the long-term exemption of individual positions or 
categories of positions to be submitted to OGE for consideration 
pursuant to 5 CFR 2641.201(d)(3) of OGE's post-Government employment 
regulations. Under the statute and OGE's implementing regulations, the 
OGE Director may determine that a waiver is warranted with respect to a 
qualified position or a category of positions if the imposition of the 
restrictions with respect thereto would create an undue hardship to the 
department or agency concerned in obtaining qualified personnel to fill 
the position(s) and that granting the waiver would not create the 
potential for use of undue influence or unfair advantage. See 18 U.S.C. 
207(c)(2)(C) and 5 CFR 2641.201(d)(5).
    The third reason for OGE's short-term waiver earlier this year was 
that the six-month waiver period would give OGE time to discuss with 
the Congress any possible changes to 18 U.S.C. 207 that would take into 
consideration the effect of pay compression on the applicability of 
post-employment restrictions. As noted above, one underlying concept of 
the post-employment restrictions is that the more severe restrictions 
should only apply to those serving in the most senior career and 
political positions. The Office of Government Ethics has seen no 
evidence that the goals of the post- employment restrictions have not 
been properly met since the new post-employment law took effect in 
1991, during which time those at SES level 4 have not been subject 
``senior employee''-level restrictions.
    Under section 207(c)(2)(A)(ii), the term ``senior employee'' 
includes any employee who is employed in a position not under the 
Executive Schedule (see 5 U.S.C. 5311-5318), including the Senior 
Executive Service, for which the basic rate of pay, exclusive of any 
locality-based pay adjustment under 5 U.S.C. 5302 (or any comparable 
adjustment pursuant to interim

[[Page 14328]]
authority of the President), is equal to or greater than the rate of 
basic pay payable for level V of the Executive Schedule. Based on these 
considerations, OGE has now, with the clearance of the Office of 
Management and Budget, suggested to Congress that the section 
207(c)(2)(A)(ii) be amended so that ``senior employee'' status 
thereunder would be triggered by the rate of basic pay for level 5 of 
the Senior Executive Service, rather than the rate of basic pay for 
level V of the Executive Schedule. The Office of Government Ethics will 
keep agencies informed of any progress on this legislative initiative.
    Under 5 CFR 2641.201(d)(4), OGE hereby gives notice that the above-
referenced post-employment waiver, granted in its January 4, 1996 
Memorandum, will expire and is revoked effective on July 1, 1996.

    Approved: March 25, 1996.
Stephen D. Potts,
Director, Office of Government Ethics.
[FR Doc. 96-7661 Filed 3-29-96; 8:45 am]
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