[Federal Register Volume 71, Number 161 (Monday, August 21, 2006)]
[Rules and Regulations]
[Pages 48447-48449]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-13736]

Rules and Regulations
                                                Federal Register

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Federal Register / Vol. 71, No. 161 / Monday, August 21, 2006 / Rules 
and Regulations

[[Page 48447]]


5 CFR Part 3301

10 CFR Part 1010

RINs 1990-AA19 and 3209-AA15

Supplemental Standards of Ethical Conduct for Employees of the 
Department of Energy and Residual Department Standards Regulation

AGENCY: Department of Energy.

ACTION: Final rule.


SUMMARY: The Department of Energy (Department or DOE), with the 
concurrence of the Office of Government Ethics (OGE), published an 
interim final rule on July 5, 1996, to establish standards of ethical 
conduct, applicable to employees of the Department, that supplement the 
Standards of Ethical Conduct for Employees of the Executive Branch 
issued by the Office of Government Ethics, and to revise the 
Department's residual standards regulation. The rule requires 
Department employees to document notices of disqualification and 
withdrawals of such notices in writing. It also requires that 
Department employees obtain the written approval of their immediate 
supervisor and the Department's designated agency ethics official or 
such official's designee prior to engaging in certain outside 
employment. The Department now discusses comments received in response 
to the interim final rule, and adopts that rule as final with certain 
changes to the Department's residual standards previously issued.

DATES: This final rule is effective September 20, 2006.

FOR FURTHER INFORMATION CONTACT: Sue E. Wadel, Deputy Assistant General 
Counsel for Standards of Conduct, Office of the Assistant General 
Counsel for General Law, GC-77, U.S. Department of Energy, 1000 
Independence Avenue, SW., Washington, DC 20585, telephone 202-586-1522.


I. Rulemaking History

    On August 7, 1992, the Office of Government Ethics published the 
Standards of Ethical Conduct for Employees of the Executive Branch 
(Standards) (57 FR 35006). The Standards, codified at 5 CFR Part 2635 
and effective February 3, 1993, establish uniform standards of ethical 
conduct applicable to all executive branch personnel.
    With the concurrence of OGE, 5 CFR 2635.105 authorizes executive 
agencies to publish agency-specific supplemental regulations that the 
agency determines are necessary and appropriate, in view of its 
programs and operations, to fulfill the purposes of the Standards.
    The interim final rule published for comment on July 5, 1996 (61 FR 
35085) by the Department, with OGE concurrence, established 
supplemental DOE regulations under 5 CFR 2635.105, and the Department, 
in the same rulemaking document, revised its residual standards 
regulation at 10 CFR part 1010. The Department determined that the 
supplemental rule was a necessary supplement to the Standards because 
it addressed ethical issues unique to the Department, and was therefore 
necessary and appropriate to fulfill the purposes of the Standards. The 
rule, codified in new chapter XXIII of 5 CFR, consisting of part 3301, 
provided a 60-day comment period and invited comments by agencies and 
the public. Comments were received from two (2) sources. In a separate 
rulemaking action, on June 3, 1998 (63 FR 30109), the Department 
published a final rule that revised the part 1010 authority citation, 
amended Sec.  1010.102, and deleted old Sec.  1010.105. The final 
rulemaking today makes no further changes to the current regulations at 
10 CFR part 1010 and 5 CFR part 3301.
    On March 1, 2000, the National Nuclear Security Administration 
(NNSA) was established as a separately organized entity within the 
Department of Energy. This rule applies to all Department employees, 
including those of NNSA.

II. Summary of Comments

    Both sets of comments concerned 5 CFR 3301.103, which requires that 
Department employees obtain the written approval of their immediate 
supervisor and the Department's designated agency ethics official or 
that official's designee (ethics counselor) prior to engaging in 
certain outside employment. The comments addressed the prior approval 
requirement (Sec.  3301.103(a)) and the definition of ``employment'' 
(Sec.  3301.103(c)). No comments were received on Sec.  3301.102 
requiring Department employees to document notices of disqualification 
and withdrawals of such notices in writing. Additionally, no comments 
were received on the revisions to the Department's residual part 1010 
standards regulation in its own CFR title and the addition of cross-
references to the new provisions.

Section 3301.103(a) Prior Approval Requirement

    The comments suggested the rule is overly broad and unenforceable. 
It was specifically stated that: (a) The rule should cover only those 
employees in ``sensitive'' positions because they are the only 
employees whom the rule affects, thus preventing an otherwise 
unwarranted invasion of privacy; (b) the rule should not apply to 
unpaid employment because unpaid employment would not ``prejudice'' an 
employee; (c) the rule, interpreted broadly, would encompass many types 
of employment that are not the type the rule seeks to prohibit; and (d) 
the rule is unenforceable because there would be no way of ensuring 
compliance with the rule.
    The Department has determined that it would not be prudent to 
narrow the scope of the rule and that, in light of the purpose of the 
rule, the fear it would be unenforceable is not valid. The rule is 
designed to help ensure that Department employees do not inadvertently 
violate the criminal statutes and Federal regulations governing outside 
activities of Federal employees. Determining whether certain outside 
employment is prohibited is very fact-specific, and does not depend 
upon an employee's position or on whether outside employment is unpaid. 
The Department does not believe it is possible to craft a 
straightforward regulation that would plainly address, in advance, the 
myriad of situations which could be considered to be employment and to 
identify which of those situations would be prohibited

[[Page 48448]]

or in conflict with the Standards. It is the Department's view that 
whatever burden the prior approval requirement may impose upon some 
employees, it is more than compensated for by the prevention of 
violations of the applicable statutes and Federal regulations. It 
should be noted that the prior approval requirement is not designed to 
arbitrarily deny Department employees permission to engage in outside 
employment. In fact, the regulation makes clear that a request for 
approval will be granted unless it is determined that the outside 
employment involves conduct prohibited by statute or regulation. See 5 
CFR 3301.103(b). In practice, since the interim final regulation has 
been promulgated, the vast majority of requests for approval to engage 
in outside employment have been routinely granted.
    The comments also maintained that the approval process contained in 
the rule, requiring approval to be in writing and obtained from an 
employee's immediate supervisor and ethics counselor, is unduly 
burdensome. It was specifically recommended that an employee's 
immediate supervisor be authorized to provide the necessary approval, 
and that verbal approval be allowed.
    The Department has not adopted these recommendations. DOE's ethics 
counselors are uniquely qualified to analyze, interpret, and apply the 
relevant statutes and regulations. Supervisors generally will not be 
able to make determinations regarding whether a specific fact situation 
may violate a statute or regulation. Further, the involvement of 
Department ethics counselors helps to ensure consistency in the 
interpretation and application of those statutes and Federal 
regulations. Written approval is the most effective way of documenting 
the approval process and it protects both the Department and the 
employee. Written approval can, as a practical matter, be more 
effectively relied upon by the Department in the event an employee 
seeks clarification about advice provided to him or her regarding 
outside employment, and by the employee in the event there is a dispute 
concerning the legality of an employee's outside employment activities. 
Disciplinary action for violating the Standards or these supplemental 
regulations will not be taken against an employee who has in good faith 
relied upon the advice of an ethics counselor, provided the employee, 
in seeking such advice, has made full disclosure of all relevant facts 
and circumstances. Where the employee's conduct violates a criminal 
statute, reliance on the advice of an ethics counselor cannot ensure 
that the employee will not be prosecuted under that statute; however, 
good faith reliance on the advice of an ethics counselor is a factor 
that may be taken into account by the Department of Justice in the 
selection of cases for prosecution. See 5 CFR 2635.107(b).
    Finally, one of the comments noted professional employees are 
governed by professional ethics rules and, therefore, the imposition of 
additional limitations is unnecessary and likely to result in 
conflicting ethical regulations. All employees of the executive branch, 
whether or not professional, must comply with the Standards and any 
other applicable statutes and regulations. Professional ethical 
obligations an employee may be subject to may be considered by the 
employee in addition to the applicable statutes and regulations, but 
shall not, under any circumstances, relieve an employee of his or her 
obligations under applicable statutes and regulations.

Section 3301.103(c) Definition of Employment

    The regulation defines ``employment'' to exclude ``participating in 
the activities of a nonprofit, charitable, religious, public service or 
civic organization, unless such activities involve the provision of 
professional services or are for compensation.'' One set of comments 
objected to the exclusion of ``professional services'' from this 
exception to the definition of ``employment'' for the following 
reasons: (a) It would ``automatically eliminate all of our professional 
workers from all public service work,'' creating a socially undesirable 
outcome; (b) it ``constitutes an unfair labor practice, for, without 
any negotiation, it bars the union from using its professional members 
for standard collective bargaining activities;'' and (c) it is 
``unnecessary'' because ``professional service provided by DOE 
professionals to public organizations is not related at all to their 
positions as government employees.''
    Comments (a) and (b) exhibit a clear misunderstanding of the 
language of the rule. The definition of employment does not prohibit 
professionals from engaging in public service work or bar the union 
from using its professional members for standard collective bargaining 
activities; rather, it simply states that if an employee's involvement 
in public service work includes the provision of professional services, 
or is for compensation, then the employee may not rely on the exception 
and must, as is required for any other type of outside employment, 
receive prior written approval. Further, determining whether certain 
outside employment is prohibited is very fact-specific and does not 
necessarily depend upon the relationship between an employee's position 
and an employee's outside activity.

III. Matters of Regulatory Procedure

Review Under Executive Order 12866

    Today's regulatory action has been determined not to be a 
significant regulatory action under Executive Order 12866, Regulatory 
Planning and Review (58 FR 51735, October 4, 1993), as amended by 
Executive Order 13258, Amending Executive Order 12866 on Regulatory 
Planning and Review (67 FR 9385, February 28, 2002). Accordingly, 
today's action was not subject to review under the Executive Order by 
the Office of Information and Regulatory Affairs, Office of Management 
and Budget.

Review Under Executive Order 12988

    Section 3 of Executive Order 12988, Civil Justice Reform, (61 FR 
4729, February 7, 1996) instructs each agency to adhere to certain 
requirements in promulgating new regulations. These requirements, set 
forth in section 3(a) and (b), include eliminating drafting errors and 
needless ambiguity, drafting the regulations to minimize litigation, 
providing clear and certain legal standards for affected legal conduct, 
and promoting simplification and burden reduction. Agencies are also 
instructed to make every reasonable effort to ensure that regulations 
describe any administrative proceeding to be available prior to 
judicial review and any provisions for the exhaustion of administrative 
remedies. The Department has determined that today's regulatory action 
meets the requirements of section 3(a) and (b) of Executive Order 

Review Under Executive Order 13132

    Executive Order on Federalism 13132 (64 FR 43255, August 10, 1999) 
imposes certain requirements on agencies formulating and implementing 
policies or regulations that preempt State law or that have federalism 
implications. Agencies are required to examine the constitutional and 
statutory authority supporting any action that would limit the 
policymaking discretion of the States and carefully assess the 
necessity for such actions. DOE has examined this rule and has 
determined that it would not preempt State law and would not have a 
substantial direct effect on the States, on the relationship between 
the national government and the States, or

[[Page 48449]]

on the distribution of power and responsibilities among the various 
levels of government. No further action is required by Executive Order 

Review Under Executive Order 13084

    Under Executive Order 13084 on Consultation and Coordination with 
Indian Tribal Governments (63 FR 27655, May 19, 1998), DOE may not 
issue a discretionary rule that significantly or uniquely affects 
Indian tribal governments and imposes substantial direct compliance 
costs. This rule would not have such effects. Accordingly, Executive 
Order 13084 does not apply to this rulemaking.

Review Under the Administrative Procedure Act and the Regulatory 
Flexibility Act

    The authorizing legislation for this rulemaking does not require 
notice and comment rulemaking. Moreover, this final rule relates solely 
to internal agency organization, management, or personnel, and as such, 
is not subject to the requirement for a general notice of proposed 
rulemaking under the Administrative Procedure Act (5 U.S.C. 553). 
Consequently, this rulemaking is exempt from the requirements of the 
Regulatory Flexibility Act (5 U.S.C. 603).

Review Under the National Environmental Policy Act

    This final rule adopts as final the Department's interim 
regulations on standards of conduct. It will not change the 
environmental effects of the regulations being amended. The Department 
has therefore determined that the rule is covered under the Categorical 
Exclusion found at paragraph A.5 of appendix A to subpart D, 10 CFR 
part 1021, which applies to rulemakings interpreting or amending an 
existing rule that do not change the environmental effect thereof. 
Accordingly, neither an environmental assessment nor an environmental 
impact statement is required.

Review Under the Treasury and General Government Appropriations Act, 

    The Treasury and General Government Appropriations Act, 2001 (44 
U.S.C. 3516, note) provides for executive agencies to review most 
disseminations of information to the public under guidelines 
established by each agency pursuant to general guidelines issued by the 
Office of Management and Budget (OMB). OMB's guidelines were published 
at 67 FR 8452 (February 22, 2002), and DOE's guidelines were published 
at 67 FR 62446 (October 7, 2002). DOE has reviewed today's final rule 
under the OMB and DOE guidelines, and has concluded that it is 
consistent with applicable policies in those guidelines.

Review Under the Paperwork Reduction Act

    This final rule does not impose a ``collection of information'' 
requirement, as defined in 44 U.S.C. 3502(3).

Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 requires each 
Agency to assess the effects of Federal regulatory action on State, 
local, and tribal governments and the private sector. The Department 
has determined that today's regulatory action does not impose a Federal 
mandate on State, local, or tribal governments or on the private 

Congressional Notification

    The Small Business Regulatory Enforcement Fairness Act of 1996 
requires agencies to report to Congress on the promulgation of certain 
final rules prior to their effective dates. 5 U.S.C. 801. That 
reporting requirement does not apply to this final rule because it 
falls within a statutory exception for rules relating to agency 
management or personnel. 5 U.S.C. 804(3)(B).

List of Subjects

5 CFR Part 3301

    Conduct standards, Conflicts of interests, Ethical conduct, 
Government employees.

10 CFR Part 1010

    Conduct standards, Conflicts of interests, Ethical conduct, 
Government employees.

    Issued in Washington, DC, on August 2, 2006.
David R. Hill,
General Counsel, Department of Energy.
    Approved: August 10, 2006.
Robert I. Cusick,
Director, Office of Government Ethics.

Accordingly, the interim final rule adding 5 CFR part 3301 and revising 
10 CFR part 1010, that was published at 61 FR 35085 on July 5, 1996, is 
adopted as a final rule with the changes published at 63 FR 30109 on 
June 3, 1998.

 [FR Doc. E6-13736 Filed 8-18-06; 8:45 am]