ETHICS AND WORKING WITH CONTRACTORS
 QUESTIONS AND ANSWERS


CONTENTS

I. Revolving Door Questions

    A. Seeking Future Employment

	1. What are the criminal restrictions that relate to looking for future 
employment with a contractor?  Page 5

	2. Do the OGE implementing regulations add anything to the criminal 
restriction?  Page 6

	3. Do the OGE regulations require employees to notify anyone that they have 
begun seeking employment or are recused from certain matters?  Page 7

	4. Beyond the criminal law and the OGE regulations, what additional 
requirements are there under the Procurement Integrity Act concerning employment 
contacts?  Page 7

    B. Post-Employment Restrictions

	5. What are the restrictions under the Procurement Integrity Act for employees 
who leave Government after working on matters relating to a Government 
contractor?  Page 8

	6. If a former employee did not serve in any of the specific contracting roles or 
perform any of the specific contracting functions described above, is he free from any 
post-employment restrictions?  Page 9

	7. Which restrictions in 18 U.S.C. &#167; 207 apply most frequently to employees 
who have been involved in contracting matters or have worked with contractors?  
Page 10

	8. Does section 207 apply when a former employee is simply performing work 
under a Government contract?  Page 11

   C. Relationship with Former Private Employer

	9. Are there criminal conflict of interest restrictions that especially affect 
personnel coming into Government after working for a Government contractor?  
Page 12

	10. If an employee has divested all interests in a former employer who is a 
Government contractor, is that sufficient to comply with all ethical obligations?  
Page 13

	11. May there be impartiality concerns even where it has been more than one 
year since an employee terminated from a contractor?  Page 14


II. Other Financial Conflicts

	12. Is an employee always prohibited from participating in a contract if he 
owns stock in the contractor?  Page 15

	13. Are interests in subcontractors covered?  Page 15

	14. Does section 208 affect an employee who "moonlights" for a contractor as 
an outside activity?  Page 15

	15. How does section 208 apply if a Government employee is married to an 
employee of a Government contractor?  Page 16


III. Other Impartiality Issues

	16. If an employee's spouse works for a contractor, could there be any 
impartiality concerns, even if 18 U.S.C &#167; 208 does not apply?  Page 17

	17. What if the Government employee is dating a contractor employee?  
Page 18

	18. May an employee award a contract to a personal friend or a company 
owned by a personal friend?  Page 18


IV. Gifts

	19. May an agency employee ever accept a gift from a contractor or an 
employee of a contractor?  Page 19

	20. May an employee use the $20 de minimis exception to accept gifts from 
various employees of the same contractor?  Page 19

	21. Are there limits on the frequency with which employees can accept gifts 
from contractors and contractor employees under the gift exceptions?  Page 20

	22. May an employee use the exception for gifts based on a personal 
relationship to accept gifts from a contractor employee with whom he has developed 
a friendship on the job?  Page 20

	23. If an employee's spouse works for an agency contractor, may the employee 
accept gifts from the contractor?  Page 21

	24. May an agency employee accept ground transportation from a contractor or 
contractor employee?  Page 21

	25. If agency employees work in the same office with contractor employees, 
may agency employees solicit contractor employees for voluntary contributions for 
gifts to be given to certain agency employees on special occasions, such as marriage 
or retirement?  Page 22

	26. May an employee accept free attendance at a conference or similar event 
sponsored by an agency contractor?  Page 23

	27. May an agency employee accept free attendance at a holiday party 
sponsored by an agency contractor?  Page 23

	28. May an employee use an agency contractor to perform personal work?  
Page 24


V. Miscellaneous Ethics Questions

	29. May an agency employee raise funds for his favorite charity from a 
contractor employee with whom he works?  Page 25

	30. Are there limits on the kinds of official information a Government 
employee may share with a contractor or contractor employee?  Page 26

	31. Are there limits on an employee's ability to benefit personally from 
information pertaining to a contract or potential contract?  Page 26

	32. May an employee "moonlight" for an agency contractor?  Page 27

	33. May an employee contract with the Government or own businesses that 
do?  Page 28

	34. May an employee provide a letter or other statement discussing the quality 
of a particular contractor's performance?  Page 29



I. Revolving Door Questions

	These Q&As begin with a discussion of several aspects of "the revolving door," 
i.e., the movement of personnel between the Government and Government contractors 
(and those who represent them).  The revolving door in the contracting area has been 
the subject of a fair amount of attention, both historically and also more recently, for 
example, with the prosecutions arising from the Druyun matter involving Air Force 
procurement.

	As set out below, the revolving door Questions are divided into three subgroups: 
current Government employees seeking future employment with contractors; former 
Government employees working for or on behalf of contractors; and former contractor 
employees now working in the Government.

  A. Seeking Future Employment

	Employees who work on contract matters or who have contact with contractor 
employees sometimes may consider the possibility of going to work for a contractor.  
There are several laws and rules that govern employees who seek future employment, 
or receive employment overtures from, contractors: 18 U.S.C. &#167; 208, OGE implementing 
regulations at 5 C.F.R. &#167;&#167; 2635.601 - 2635.606, and the Procurement Integrity Act.  This is 
an area that has received considerable attention recently, not only from the media and 
Congress but also from Federal prosecutors.  See OGE DAEOgram DO-04-029, available 
at http://www.usoge.gov/daeograms/dgr_files/2004/do04029.pdf.  Employees 
should be made aware of the seriousness of these issues and encouraged to seek timely 
advice from agency ethics officials about their own specific situations.

	1. What are the criminal restrictions that relate to looking for future 
employment with a contractor?

	Under 18 U.S.C. &#167; 208, an employee may not participate in any particular 
Government matter that would affect the financial interests of any contractor (or other 
person) with which the employee is negotiating, or has an arrangement, for future 
employment.  Although it may be possible for an employee to receive a waiver of this 
prohibition, OGE gives heightened scrutiny to proposed waivers in this situation, and 
waivers for employment negotiations should be issued only in compelling 
circumstances.  See DAEOgram DO-04-029, at 7-8.

	It is important to remember that this criminal prohibition applies to all particular 
matters that would have a direct and predictable effect on the financial interest of the 
prospective employer.  In contrast, as discussed below, related provisions of the 
Procurement Integrity Act apply only to certain kinds of procurements and certain 
specific kinds of official activities in connection with those procurements.  The 
restrictions in section 208 apply whether or not the Procurement Integrity Act applies, 
as long as the employee is participating in a particular matter. 

         It is also important to remember that the employee's level of participation in the 
particular matter need only be "personal and substantial" in order to violate section 208; 
the employee need not be the final decisionmaker on any contract matter and need not 
serve in any specifically designated role (such as contracting officer) or perform any 
specifically designated procurement function (such as preparing specifications and 
solicitations or evaluating bids).  As discussed below, the Procurement Integrity Act 
uses similar language concerning personal and substantial participation, but that 
language has a narrower meaning than in section 208.

Example:  A contractor provides engineering support services for an agency program.  
An agency employee involved in this program periodically provides information to the 
contracting officer concerning the quality of the contractor's performance.  The employee 
begins discussing the possibility of going to work with the contractor.  Under 18 U.S.C. 
&#167; 208, he must immediately recuse himself from any further participation in the 
evaluation of this contractor's performance or any other issue arising under the contract.  

       2. Do the OGE implementing regulations add anything to the criminal 
restriction?

	Yes.  The OGE implementing regulations do not cover only employees who are 
actually negotiating or have an agreement to work for a prospective employer.  They 
also require recusal by those who are merely "seeking" employment by making 
unsolicited contacts about possible employment, such as sending a resume to a firm on 
whose contract or bid the employee is working.  Likewise, the OGE regulations require 
recusal if an employee makes any response other than rejection to a contractor's 
unsolicited overtures about possible employment.

Example:  The employee in the previous example to Question 1 has not actually begun 
discussions with the contractor, but has simply submitted a resume with a cover letter 
indicating his interest in working for the company.  Even though he has heard no 
response from the company, he has begun seeking employment under the OGE rule, and 
must recuse himself from working on matters arising under the contract.  If two months 
elapse and the employee still has received no indication of interest on the part of the 
contractor, the employee no longer will be deemed to be seeking employment with the 
contractor.  Likewise, if the contractor tells the employee that it is not interested and there 
is no further discussion of possible employment, the employee no longer will be deemed to 
be seeking employment with that contractor.

	3. Do the OGE regulations require employees to notify anyone that they have 
begun seeking employment or are recused from certain matters?

        The OGE regulations do not require any particular notification.  Employees 
comply with any recusal obligations under section 208 and the OGE regulations simply 
by avoiding participation in any particular matter in which the prospective employer 
has a financial interest.  However, the regulations add that an employee "should" notify 
the person responsible for his assignment of the need to recuse from a particular matter; 
while this is not a mandatory notification duty, it does point employees in the direction 
of common sense.  Moreover, an agency ethics official may require written 
documentation of a recusal, and such documentation also may be required as evidence 
of compliance with an ethics agreement.  Note, furthermore, that the Procurement 
Integrity Act and the Federal Acquisition Regulation do impose certain mandatory 
notification procedures, as discussed in Question 4 below.

	4. Beyond the criminal law and the OGE regulations, what additional 
requirements are there under the Procurement Integrity Act concerning employment 
contacts?

	The Procurement Integrity Act imposes additional requirements on employees 
who are participating personally and substantially in a procurement (i.e., the 
acquisition of goods or services by using competitive procedures and awarding a 
contract) in excess of the simplified acquisition threshold.  41 U.S.C. &#167; 423(c).  For 
purposes of the Procurement Integrity Act, personal and substantial participation is 
limited to certain specific functions involving: the specification or statement of work; 
the solicitation; the evaluation of bids or proposals, or selecting a source; negotiation of 
price or terms and conditions of the contract; or the review or approval of the award of 
a contract.  48 C.F.R. &#167; 3.104-1.  Employees who are participating in these ways in a 
covered procurement have the following obligations if they contact, or are contacted by, 
a bidder or offeror regarding possible employment:

*	Promptly report the employment contact, in writing, to both the 
employee's supervisor and the Designated Agency Ethics Official (or 
designee); and


*	Either-- 

(a) reject the possibility of employment, or
 
(b) recuse from the procurement until the agency has authorized 
the employee to resume participating (in accordance with 18 U.S.C. 
&#167; 208 and applicable regulations) on the ground that the 
prospective employer is no longer a bidder or offeror, or on the 
ground that all employment discussions have terminated without 
an agreement or arrangement.

	Note additionally that the Federal Acquisition Regulation requiresin addition 
to the written report on employment contacts discussed abovea written 
disqualification notice, which must be submitted to the contracting officer, the source 
selection authority, and the employee's immediate supervisor.  41 C.F.R. &#167; 3.104-5(a).

	Also, keep in mind that, even though section 208 and the Procurement Integrity 
Act use similar language concerning personal and substantial participation, section 208 
covers activities and functions beyond those listed in the Federal Acquisition 
Regulation at 41 C.F.R. &#167; 3.104-1.  For purposes of the Procurement Integrity Act, the 
FAR has interpreted personal and substantial participation more narrowly than OGE 
interprets the language in section 208 and the OGE implementing regulations.

  B. Post-Employment Restrictions

	Employees who are involved in contracting matters or who work with 
contractors and contractor personnel need to be aware that certain restrictions may 
apply to their activities even after they leave Government.  It is also important for 
employees to remember that the procurement-specific provisions of the Procurement 
Integrity Act, 41 U.S.C. &#167; 423, are not the only post-employment restrictions about 
which they must be concerned: the criminal post-employment law, 18 U.S.C. &#167; 207, 
contains different, and in some respects broader, requirements.

	5. What are the restrictions under the Procurement Integrity Act for employees 
who leave Government after working on matters relating to a Government 
contractor?

        An employee who has served in specific contracting roles, or performed specific 
contracting functions, on certain contract matters over $10,000,000, generally is 
prohibited for one year from receiving compensation from the contractor for service as 
an employee, officer, director, or consultant.  The specific contracting roles and 
functions are as follows: 

*	serving as program manager, deputy program manager, or administrative 
	contracting officer for a contract over $10,000,000;
*	making a decision to award a contract, subcontract, modification of a 
	contract or task or delivery order over $10,000,000; 
*	making a decision to establish overhead or other rates for a contract or 
	contracts for a particular contractor over $10,000,000; 
*	making a decision to issue payments over $10,000,000 to a particular 
	contractor; 
*	making a decision to pay or settle a claim over $10,000,000 with a 
	particular contractor.  41 U.S.C. &#167; 423(d).

	This prohibition does not prevent an employee from going to work for a division 
or affiliate of the contractor that does not produce the same or similar products or 
services as the entity of the contractor responsible for the contract in which the 
employee was involved.  41 U.S.C. &#167; 423(d)(2).

        Note also that a current or former Government employee may not disclose 
contractor bid or proposal information or source selection information before the award 
of the procurement contract.  41 U.S.C. &#167; 423(a).

Example:  An agency employee served as administrative contracting officer on a 
$25,000,000 contract with ABC Company.  Shortly after he retired from Government, 
ABC approached him about working as a consultant on a different contract with a 
different agency.  Even though his duties for the company would not involve any contact 
with his former agency, the former employee may not accept compensation as a 
consultant for ABC for one year after he last served as administrative contracting officer 
on the ABC contract.

	6. If a former employee did not serve in any of the specific contracting roles or 
perform any of the specific contracting functions described above, is he free from any 
post-employment restrictions?

	No.  Quite apart from the Procurement Integrity Act, there is a criminal statute, 
18 U.S.C. &#167; 207, that imposes several restrictions that could apply to a former employee 
who worked on contract matters but did not actually serve in any of the contracting 
roles or perform any of the contracting functions designated in the Procurement 
Integrity Act.

Example:  An employee participated in evaluating the performance of a contractor, but 
did not serve in any of the positions or perform any of the functions or make any of the 
decisions described in 41 U.S.C. &#167; 423(d).  The employee is barred by 18 U.S.C. 
&#167; 207(a)(1) from representing the contractor (or any other person) before the Government 
concerning this same contract. 

	7. Which restrictions in 18 U.S.C. &#167; 207 apply most frequently to employees 
who have been involved in contracting matters or have worked with contractors?

	Although section 207 has seven separate prohibitions applicable to executive 
branch employees, three provisions tend to come up most frequently.  (For a full 
description of all of the restrictions and exceptions in section 207, see OGE DAEOgram 
DO-04-023A, available at http://www.usoge.gov/daeograms/dgr_files/2004/do04023a.pdf.)  Each of 
these three applies to representing another person before the Government, i.e., making 
a communication or appearance with the intent to influence the Government.  They do 
not, however, apply to behind-the-scenes work for a contractor or other person. 

        A lifetime ban on representing any other person before the Government on the 
same "particular matter involving specific parties," such as a contract, in which the 
former employee participated for the Government; the former employee may have 
participated personally and substantially in a contract, under this provision, without 
actually serving in any of the specific contracting roles or performing any of the specific 
functions or decisions designated in the Procurement Integrity Act.

Example:  See the Example following Question 6 above.

        Section 207 also has a two-year ban on representing another person before the 
Government on the same contract (or other particular matter involving specific parties) 
that was pending under the official responsibility of the former employee during his   
last year of Government service; the former employee need not have participated at all 
in the contract, so long as the matter was in his chain of supervision.

Example:  The head of a division at an agency was not involved in any particular 
contract.  However, every contract that was pending in his division, even if handled by 
subordinates several levels below the division head, was under his official responsibility.  
Consequently, for two years after he leaves Government, he could not represent anyone 
on any contract that was pending in his division during his last year of service.

        The third major prohibition is a one-year "cooling-off" period for any matter 
involving the employee's former agency; this provision is applicable only to senior 
employees, e.g., commissioned officers at 0-7 and above and civilian employees with a 
rate of basic pay equivalent to 86.5 % of Executive Level II ($142,898 in 2006); the ban 
can apply even to new contracts, as well as to broader procurement policy matters that 
don't even focus on specific contracts.

Example:  A member of the Senior Executive Service was paid at a rate of $150,000 in 
2006, when he left his agency for a position with a contractor.  The contractor wants him 
to call his former agency about a potential new contract.  This matter was not pending in 
the agency when the former employee was employed there.  Nevertheless, the former 
employee may not represent the contractor before the agency on this (or any other) matter 
for one year after terminating his senior position with the agency.

	8. Does section 207 apply when a former employee is simply performing work 
under a Government contract?

	It depends.  If the former employee is able to remain "behind-the-scenes," he will 
not violate any of the three main prohibitions discussed in Question 7.  Note that the 
less frequently applicable provisions in section 207(b), (f) and (l) do cover certain 
behind-the-scenes activities.

	  If the former employee's work under the contract requires communication with 
the Government, these prohibitions in section 207 may apply.  Employees sometimes 
assume, incorrectly, that section 207 applies only to communications about the award or 
modification or other major business aspects of a contract.  However, section 207 also 
can apply to communications that a former employee makes while performing work 
under the contract, even if the contract specifically requires contractor personnel to 
communicate with the Government.  Of course, certain routine or ministerial 
communications would not be covered, for example, making routine factual statements 
that are not potentially controversial.  However, many communications made while the 
former employee is performing the contract may involve the intent to influence the 
Government, because the contractor and the Government have potentially differing 
views or interests on the matter being discussed.  (For further discussion of this issue, 
see OGE Informal Advisory Letters 99 x 19, 03 x 6, and 05 x 3.)

Example:  A Government economist participated personally and substantially in a 
contract that required the contractor to perform certain econometric studies.  The 
contractor would like to hire him to work on performing further research under the same 
contract.  The job would require the individual to meet frequently with agency personnel 
to answer any questions concerning the research that has been performed and to obtain 
instructions for further research.  It is expected that these discussions sometimes may 
involve questions about the adequacy of research already performed or alternative 
approaches to performing future research.  Such discussions, even though required under 
the contract, potentially could involve disputes between the contractor and the agency.  
The employee should be advised that section 207 could prevent him from meeting with 
agency employees as intended.

  C. Relationship with Former Private Employer

	Ethics questions can arise not only when a Government employee moves to the 
private sector, but also when a private sector employee moves to the Government.

	9. Are there criminal conflict of interest restrictions that especially affect 
personnel coming into Government after working for a Government contractor?

	Yes.  Although individuals are subject to a number of criminal conflict of interest 
laws after they leave a contractor and go to work for the Government, issues are most 
likely to arise under 18 U.S.C. &#167; 208 and, possibly, 18 U.S.C &#167; 209.

        Former employees of Government contractors may have continuing financial 
interests in their former employer.  These could include stock, stock options, different 
types of pensions and deferred compensation arrangements, or other miscellaneous 
benefits.  Depending on the circumstances, any of these interests could give the 
employee a continuing financial interest in contracts and other particular matters that 
affect the contractor.  Under 18 U.S.C. &#167; 208, a Government employee must recuse 
himself from any particular matter in which he has a financial interest, absent a waiver 
or applicable regulatory exemption.  Therefore, any continuing interest in a former 
employer must be examined to determine whether it requires the individual to be 
recused from contract matters affecting the former employer.  In some cases, it may be 
necessary for the employee to divest the conflicting interest.  See 5 C.F.R. &#167; 2635.403.
        
Example:  An individual worked for many years for a computer company.  He has 
acquired over $100,000 in the company's stock as a result of various profit-sharing 
benefits.  The individual joins the IT office at an agency that does substantial business 
with the company.  Absent a waiver, he may not participate in any contracts involving 
the company.  If the agency does not believe a waiver would be appropriate, and recusal 
would prevent the employee from performing critical duties, the agency may require the 
employee to divest the stock.

        Occasionally, issues also may arise under 18 U.S.C. &#167; 209 if payments or other 
benefits are given to an employee by a former employer who is a Government 
contractor.  Section 209 prohibits employees from receiving any supplementation of 
their Federal salary as compensation for their services to the Government.  Section 209 
may apply if a former employer makes a payment to a Government employee and there 
is an indication that the payment is intended to compensate the employee for doing his 
Government job, rather than to compensate the person for past services to the former 
employer or for some other reason unrelated to Government service.  For a 
comprehensive discussion of section 209, see DAEOgram DO-02-016A, available at 
http://www.usoge.gov/pages/laws_regs_fedreg_stats/lrfs_files/othr_gdnc/og_sum209_02.pdf.  Note that 
section 209 does not apply to a payment made before the individual actually starts as a 
Government employee; in such cases, however, the employee may be subject to recusal 
obligations described in Question 10 below.

	10. If an employee has divested all interests in a former employer who is a 
Government contractor, is that sufficient to comply with all ethical obligations?

	Not necessarily.  There are two provisions in the OGE standards of conduct that 
may require an employee to recuse, for a certain period of time, from working on 
contracts and certain other matters involving a former employer.

        Under 5 C.F.R. &#167; 2635.502, an employee must recuse, for one year after leaving a 
former employer, from any contract or other particular matter in which the former 
employer is a party (or represents a party), if either the employee or an agency designee 
determines that a reasonable person with knowledge of the circumstances would 
question the employee's impartiality.  This recusal obligation may be lifted only by an 
authorization from an agency designee.

Example:  An agency, which is responsible for certain emergency management 
operations, has a contract with a company to provide a range of support services in a 
particular location.  An individual, who had been working as an employee of the 
contractor, now has been hired directly by the agency.  The employee will have a covered 
relationship with the contractor for one year.  Before the employee is assigned to work on 
any contract involving the company, the employee and the agency need to consider 
impartiality concerns and determine whether the employee should be recused or 
authorized to participate in the matter.

        Under 5 C.F.R. &#167; 2635.503, an employee must recuse, for two years after receiving 
an "extraordinary payment" from a former employer, from any contract or other 
particular matter in which the former employer is a party (or represents a party).  An 
extraordinary payment means a payment (1) in excess of $10,000, (2) determined after 
the former employer knew that the individual was being considered for a Government 
position, and (3) not pursuant to the former employer's established compensation 
program.

Example:  The employee in the previous example was given a $15,000 severance payment 
after the company learned that he was being considered for a position with the agency.  
According to the company, the severance payment was intended to honor the individual 
for his hard work and contribution to the mission of the company.  This individual was 
the first person ever awarded such a payment by the company, and the company had no 
written policy or contract establishing the benefit.  This is an extraordinary payment, 
and the employee would be recused for two years from working on any contract involving 
the company, absent a waiver.

	11. Can there be impartiality concerns even where it has been more than one 
year since an employee terminated from a contractor?

	Possibly.  As noted above, if the employee received an extraordinary payment 
from a contractor, impartiality concerns are addressed for two years under the recusal 
requirements of 5 C.F.R. &#167; 2635.503.  Even if the employee did not receive an 
extraordinary payment and more than a year has transpired since the employee left the 
contractor, there still may be impartiality concerns if the employee is assigned to 
participate in contracts involving the former employer.  Section 2635.502(a)(2) provides 
a "catch-all" mechanism for employees and agencies to address impartiality concerns 
arising in circumstances that are not specifically covered in the rule.

Example:  An individual was the director of a university laboratory, where he was 
responsible for the lab's contract with an agency to perform research on a new 
communications technology for an agency system.  Then the agency hired him.  Two 
years later, the lab made a claim for payment, which the agency is considering denying 
on the ground that the lab has not completely performed certain required work.  The 
program manager would like to use the employee to review the adequacy of the lab's 
work, in light of his significant expertise with the technology.  Given the employee's past 
level of involvement with this same contract on behalf of the contractor, as well as the 
sensitivity of the performance dispute, it would be reasonable for the agency and the 
employee to conclude that the employee should not participate in this decision.


II. Other Financial Conflicts

	Questions 1 and 9 above deal with various aspects of 18 U.S.C. &#167; 208, which 
prohibits employees from working on contracts and other particular matters affecting 
their personal or imputed financial interests.  In addition to those situations discussed 
above, the following Questions explore some of the more common scenarios involving 
section 208 and contractors.
	12. Is an employee always prohibited from participating in a contract if he 
owns stock in the contractor?

	Not always.  OGE has issued regulations exempting certain de minimis amounts 
of publicly traded securities.  An employee can work on a contract as long as he owns 
no more than $15,000 of publicly traded stock in the contractor.  The $15,000 limit 
applies to the sum of all stock owned by the employee, the employee's spouse and the 
employee's minor children, in all companies affected by the same contract (including 
subcontractors and competing offerors).  It is important to remember that this 
exemption applies to publicly traded stock, not to stock or any other ownership interest 
in a privately held company.  (Note that this exemption does not apply to stock that 
would be a prohibited holding for the employee, for example, under an agency-specific 
statute or regulation.)  Also, in some cases, an agency may grant an employee an 
individual waiver under 18 U.S.C. &#167; 208(b)(1), to permit participation where the 
employee owns more than $15,000 in stock.

Example:  An employee's spouse owns $10,000 of stock in a private company that has 
submitted a bid on a small contract with the employee's agency.  The de minimis 
exemption does not apply to this non-publicly traded stock, and the employee may not 
participate in the procurement, absent an individual waiver.  On the other hand, if the 
company's stock were publicly traded, the employee could participate.  However, if the 
employee also owned another $10,000 in the stock of a competing bidder on the same 
contract, he would exceed the $15,000 limit and would have to recuse, absent a waiver.

	13. Are interests in subcontractors covered?

	Yes. Section 208 applies to an employee's financial interest in a subcontractor 
involved in a Government contract.

Example:  An employee's spouse owns a controlling interest in a private company.  A 
bidder on a Government contract plans to use this company as a subcontractor on the 
contract.  The employee may not participate in the procurement.

	14. Does section 208 affect an employee who "moonlights" for a contractor as 
an outside activity?

	Yes.  Under section 208, an employee may not participate in any contract or other 
particular matter in which his outside employer has a financial interest.  A Government 
employee who moonlights for a contractor must recuse from particular matters 
affecting that contractor.  Outside employment with a contractor is discussed in more 
detail in Question 32 below.

Example:  An agency has a contract with a medical testing company to provide certain 
diagnostic services to beneficiaries under an agency health program.  An agency doctor 
orders tests for patients pursuant to the contract.  The doctor may not participate in these 
decisions if he takes an outside job with the company, absent a waiver.

	15. How does section 208 apply if a Government employee is married to an 
employee of a Government contractor?

	Section 208 prohibits an employee from working on contracts and other 
particular matters affecting a spouse's financial interests.  The need to recuse could arise 
in various situations.

Example: An employee works on a contract for his agency.  His spouse is hired by the 
contractor to work on the same contract.  The spouse's continued employment and 
possible advancement with the company depend on the firm's success with this particular 
contract.  Section 208 would apply, even if the Government employee does not personally 
review the work of the spouse or even participate in the same part of the contract in which 
the spouse is involved.

Example: An employee's spouse works for an agency contractor.  She participates in the 
company's stock purchase program and also receives periodic cash bonuses tied to firm 
profitability.  Therefore, she has a financial interest in any contract that her company has 
with the agency, even if her own work does not involve the particular contract and she 
does not work in the same division of the company that is performing the contract.  The 
employee may not participate in any contract with the company, absent a waiver.

Example:  The spouse of an employee is a partner at a law firm that is representing a 
disappointed bidder in a bid protest against the agency.  As a partner, the spouse has a 
financial interest in all particular matters in which her firm is representing a client, 
including matters in which she herself is not providing services.  The employee may not 
work on the bid protest, without a waiver.

	In some cases, however, the spouse will not have any financial interest in a 
Government contract.

Example:  An agency employee is assigned to work on a contract involving his spouse's 
employer.  The contractor is a large company with many different contracts and business 
operations.  The spouse works in an area of the company's business that is unrelated to 
the contract with the employee's agency.  Moreover, the spouse receives a straight salary 
from the company, without any equity or profit-sharing interests.  Section 208 would not 
prohibit the employee from participating in this contract.  

	Even if the spouse does not have a financial interest in the contract on which the 
Government employee is working, there still may be impartiality issues, as described in 
Question 16.


III. Other Impartiality Issues

	OGE's impartiality rule, 5 C.F.R. &#167; 2635.502, is discussed in Questions 10 and 11 
above.  In addition to the situations described in those Questions, various other 
relationships and interests can raise concerns about an employee's impartiality.  A few 
of the more common scenarios are described in Questions below. 

	16. If an employee's spouse works for a contractor, could there be any 
impartiality concerns, even if 18 U.S.C &#167; 208 does not apply?

	Yes.  A Government employee has a "covered relationship" with his spouse's 
employer, under 5 C.F.R. &#167; 2635.502(b) (1) (iii), even if his spouse does not have a 
financial interest in a particular Government contract.  This rule would require an 
employee to recuse from any contract involving a spouse's employer, if either the 
employee or an agency designee determines that a reasonable person with knowledge 
of the circumstances would question the employee's impartiality.  In some cases, the 
agency might authorize the employee to work on the contract in any event.

Example: The employee in the last Example following Question 15 above has a covered 
relationship with the contractor that employs his spouse.  Because of his significant 
experience in the subject matter, the employee is the most qualified person in his office to 
work on the particular matter, and it would be difficult to find another employee to 
perform the same duties.  In light of the size of the company, the variety of its business 
activities, and the fact that the spouse is employed in a totally different area of the 
companys operations, the agency might determine that a reasonable person would not 
question the employee's impartiality in this matter.  Alternatively, the agency might 
determine that any impartiality concerns are outweighed by the agency's need for the 
employee's services on the matter, in which case the employee could participate in the 
contract pursuant to an authorization under 5 C.F.R. &#167; 2635.502(d).  Depending on the 
circumstances, the agency might want to impose certain conditions, such as limits on the 
kinds of decisions the employee can make without review or approval by supervisors.
  
       

17. What if the Government employee is dating a contractor employee?

        Under the impartiality rule, an employee does not have a "covered relationship" 
with a person he is merely dating or with the employer of a person he is dating.  
However, the impartiality rule provides a mechanism for employees and agencies to 
evaluate impartiality concerns, even in situations not involving a covered relationship.  
See 5 C.F.R. &#167; 2635.502(a) (2).

Example:  An agency employee begins dating a contractor employee with whom he works.  
One of his duties involves reviewing the work of the contractor, including the contractor 
employee he has begun dating.  The employee's impartiality in reviewing the work could 
reasonably be questioned under these circumstances, and the employee and the agency 
should use the procedures in section 2635.502 to determine whether, or under what 
conditions, he should be permitted to continue participating in the matter.

	Note that there would be additional considerations if the Government employee 
and the contractor employee were residing together.  18 U.S.C. &#167; 208 would prohibit a 
Government employee from working on a contract that affects the contractor 
employee's ability to pay any shared living expenses.  In any case, the impartiality rule 
expressly covers situations in which an employee participates in a contract that affects 
the financial interest of "a member of his household."  5 C.F.R. &#167; 2635.502(a).  Similarly, 
the Government employee would have a covered relationship with a person who is a 
member of his household.  5 C.F.R. &#167; 2635.502(b)(ii).  For all of these reasons, a 
Government employee should not participate in a contract if a contractor employee, 
with whom he resides, is working on the same contract, unless the employee and his 
agency first have resolved any potential financial conflict of interest under section 208 
and any impartiality concerns under section 2635.502.

	18. Can an employee award a contract to a personal friend or a company owned 
by a personal friend?

	It depends.  An employee does not have a covered relationship with someone 
merely because that person is a personal friend.  However, it is clear that employees 
should consider any potential impartiality questions before participating in a decision 
to give a contract to a personal friend, and the procedures set out in 5 C.F.R. 
&#167; 2635.502(a)(2) will facilitate the review of all relevant circumstances.  Allegations of 
favoritism can, and sometimes do, arise when Government contracts are awarded to a 
friend, so agencies and employees should be particularly alert to any impartiality 
concerns.

Example:  An employee has long been friends with someone who is a healthcare 
consultant.  They periodically meet for lunch and also occasionally get together with their 
families.  The agency needs to acquire healthcare consulting services about a subject on 
which the employee knows his friend is an expert.  Before recommending that his agency 
consider giving a contract to his friend, the employee should follow the process described 
in section 2635.502.


IV. Gifts

	A common issue, particularly among employees who work closely or share office 
space with contractor personnel, is how to deal with gift-giving between contractor 
employees and Government employees.  Employees should know that the ethics rules 
generally forbid them from accepting gifts from "prohibited sources," which clearly 
includes any contractor working for the employee's agency.  5 C.F.R. &#167; 2635.203(d).  It is 
important to remember that, regardless of the working relationship between 
Government and contractor personnel, contractor personnel remain employees of the 
contractor.  As such, they are deemed "prohibited sources," under the OGE gift rules, to 
the same extent as the contractor that employs them.  See 5 C.F.R. &#167; 2635.102(k) 
(definition of person includes not only an entity but also any employee of that entity).

	19. May an agency employee ever accept a gift from a contractor or an 
employee of a contractor?

	Yes.  The OGE gift rules have several exceptions that would permit gifts from a 
prohibited source, including an agency contractor or an employee of an agency 
contractor.  See 5 C.F.R. &#167; 2635.204.  (In addition, there are certain items that a 
Government employee may accept from a prohibited source because those items are not 
considered gifts.  See 5 C.F.R. &#167; 2635.203(b)(1)-(9).)  Questions 20-27 discuss some of the 
exceptions that may be applicable in common situations involving contractors and 
contractor personnel.

	20. May an employee use the $20 de minimis exception to accept gifts from 
various employees of the same contractor?

        Possibly.  Under 5 C.F.R. &#167; 2635.204(a), an employee may accept noncash gifts 
from a prohibited source, if the gifts from a particular source have a value of no more 
than $20 per occasion and $50 per calendar year.  A contractor and an employee of a 
contractor are considered the same source under the OGE rules.  Therefore, an agency 
employee could accept gifts from multiple contractor employees, but such gifts could 
not exceed the applicable limits for one source.

Example:  On his birthday, an agency employee receives a birthday gift valued at 
$20 from a contractor employee with whom he works in a shared office space.  Later in the 
year, during the holiday season, the same agency employee receives a $15 gift from 
another employee of the same contractor.  The employee could accept these gifts.  
However, if a third contractor employee offered to pick up a $20 lunch check for the 
agency employee  the next day, the agency employee would have to decline the gift, as this 
would exceed the $50 annual limit per source.

	21. Are there limits on the frequency with which employees can accept gifts 
from contractors and contractor employees under the gift exceptions?

	Yes.  An employee may not use any of the gift exceptions, including the 
de minimis exception, to accept gifts from the same or even different sources so 
frequently that a reasonable person would believe the employee is using his public 
office for private gain.

Example:  An agency employee works in an office along with personnel from several 
different support contractors, and she has responsibility for providing feedback on the 
performance of all of these contracts.  She could not make a practice of going to lunch 
nearly every week at the expense of one or another of these contractors or their employees, 
even if the gifts from any one contractor fell within the de minimis limits for one source.

	22. May an employee use the exception for gifts based on a personal 
relationship to accept gifts from a contractor employee with whom he has developed 
a friendship on the job?

	Maybe.  Under 5 C.F.R. &#167; 2635.204(b), an employee sometimes may accept a gift 
from a prohibited source with whom the employee has a personal friendship.  
However, it must be clear from the circumstances that it was the friendship, and not the 
employee's official position, that motivated the gift.  Relevant factors include the history 
of the relationship and whether the gift was actually paid for by the friend (as opposed 
to, for example, the contractor who employs the friend).  Although it is certainly 
possible that an agency employee could develop a personal friendship with a contractor 
employee on the jobespecially given the close working conditions in some mixed 
workplaces todaycaution is advised.  Particular care should be exercised to evaluate 
whether the nature of the relationship really justifies a particular gift.  Where the 
relationship developed on the job, a gift rarely would be justified if the Government 
employee were actually in a position to oversee the work of the contractor employee or 
to participate in decisions affecting the interests of the contractor.

Example: An employee has a pleasant, but relatively short, job-centered relationship with 
a contractor employee.  The contractor employee offered a free weekend away at his beach 
house.  Based on the history and nature of the relationship, one reasonably would 
question whether the motive for the offer was related to the Government employee's 
official position.

	23. If an employee's spouse works for an agency contractor, may the employee 
accept gifts from the contractor?

	Possibly.  Under 5 C.F.R. &#167; 2635.204(e)(1), an employee may accept gifts from his 
spouse's employer under certain circumstances.  The employee may accept meals, 
lodgings, transportation, or other benefits that result from his spouse's business or 
employment activities, but it must be clear that the benefits have not been offered or 
enhanced because of the employee's official position.

Example: An agency employee could accept free attendance at an annual retreat offered 
by a contractor to the families of all contractor employees.  However, an employee could 
not accept if the same benefit were not extended to the families of similarly situated 
contractor employees who were not married to an agency employee.

	24. May an agency employee accept ground transportation from a contractor or 
contractor employee?

	It depends.  The definition of "gift" in the OGE rules expressly includes 
"transportation" and "local travel."  5 C.F.R. &#167; 2635.203(b).  However, in order to 
determine whether such a gift would violate the ethics rules, it would be necessary to 
determine whether the transportation is duty-related or for the personal benefit of the 
individual.

	If the transportation is provided in connection with the performance of the 
employee's official duties, there would be no gift to the employee personally, but rather 
a service provided to the agency.  As described more fully in OGE Informal Advisory 
Letter 98 x 8, such benefits must be analyzed under fiscal law considerations, not the 
OGE ethics rules.

Example: An employee is offered ground transportation by a contractor to travel between 
two work sites during official site visits.  This is a benefit provided to the agency, not the 
employee personally, and therefore does not implicate the OGE gift rules.  The agency 
would have to determine whether it has authority to accept this benefit.

	However, if the transportation was for the personal benefit of the employee, then 
it would constitute a gift to the employee under the OGE gift rules.

Example: A contractor offers to allow an employee to use the contractor's shuttle bus as 
part of his daily commute to the office.  This is a gift to the employee personally and may be 
accepted only if one of the gift exceptions applies.  For example, if the employee were only 
going to use the shuttle service for two days while he was on a special assignment, and it 
could be determined that the value of the service for that limited time period fell within the 
$20 de minimis amount, then the employee could accept the offer. 

	25. If agency employees work in the same office with contractor employees, 
may agency employees solicit contractor employees for voluntary contributions for 
gifts to be given to certain agency employees on special occasions, such as marriage 
or retirement?

	No.  While the OGE rules permit the solicitation of voluntary contributions for 
certain gifts to official superiors on special occasions, see 5 C.F.R. &#167; 2635.304(c), the rules 
allow only solicitation of other Government employees.  Therefore, the provisions 
governing gifts between Government employees do not apply to gifts from contractor 
employees to Government employees.

	Furthermore, there is no exception in the OGE gift rules that would permit an 
agency employee to solicit a gift from a prohibited source for the benefit of another 
agency employee.  See 5 C.F.R. &#167;&#167; 2635.202(c)(2)(gift exceptions may not be used to 
solicit gifts); 2635.203(f)(soliciting indirect gifts for another person).  An agency 
employee may accept an unsolicited gift from a contractor employee, if permitted by 
any of the gift exceptions, but there is no specific exception focusing on gifts for special 
occasions, such as marriage or retirement.

Example: An agency employee is organizing a dinner in honor of her supervisor's 
upcoming retirement and would like to invite several contractor employees who share the 
same workplace.  The agency employee may not solicit a contribution from the contractor 
personnel for a retirement gift.  Any contractor personnel who attend the dinner may 
contribute their appropriate share for the cost of their own meals, which would not be a 
gift at all.  Moreover, all employees of the same contractor may give the retiree a single, 
unsolicited gift valued at $20.

	
       26. May an employee accept free attendance at a conference or similar event 
sponsored by an agency contractor?

	It depends. Under 5 C.F.R. &#167; 2635.204(g)(2), an employee may accept free 
attendance at a widely attended gathering of mutual interest under certain 
circumstances.  The event must be truly widely attended (see the Example following 
Question 27), and the agency must make a determination that the employee's 
attendance would be in the agency's interest.  If the employee is actually working on 
matters that affect the particular contractor who made the offer, then the agency would 
have to make a written determination that the agency's interest outweighs the concern 
that the gift could improperly influence the employee in the performance of his duties.  
Note that free attendance, under this rule, does not include travel expenses.  

Example:  An agency employee is one of several employees who are involved in the 
ongoing evaluation of work performed by a contractor that provides certain IT services.  
The contractor is co-sponsoring (along with a university) a one-day conference on 
security threats to IT systems.  The contractor has extended an offer of free attendance to 
the agency employee.  The event will include speakers from academia, industry and 
government and will not focus on any particular company's own products and services.  
The agency may authorize the acceptance, in writing, based on a determination that the 
agency's interest in the employee learning about IT security threats at this substantive 
event outweighs any concern that the offer of free attendance will affect the performance 
of the employee's official duties.

	In some cases, the agency may choose to send the employee to the event on 
official duty.  In those instances, free attendance would be a gift to the agency, rather 
than to the employee personally.  Such gifts might be accepted under an applicable 
agency gift acceptance statute or, if the employee would be on official travel, under 
31 U.S.C. &#167; 1353.  If the contractor were a 501(c)(3) nonprofit organization, the gift also 
might be accepted under 5 U.S.C. &#167; 4111.
	
       27. May an agency employee accept free attendance at a holiday party 
sponsored by an agency contractor?

	Maybe.  The definition of "gift" in the OGE rules covers any item having 
monetary value, including, among other things, "entertainment," "hospitality" and 
"meals."  Although the definition of gift excludes "modest" refreshments (such as soft 
drinks, coffee and donuts, as long as they are not part of a meal), most holiday parties 
are not confined to such items.  Accordingly, free attendance at a contractor party 
would be permitted only pursuant to an applicable gift exception.
Example:  A contractor invites agency employees to a holiday party.  The party will be 
attended only by contractor personnel who work in a particular office.  If the value of the 
food and any entertainment were determined to be no more than $20, the employees could 
accept.  However, the employees could not use the widely attended gathering exception to 
accept this gift, because the event would not be attended by a large number of persons 
with a diversity of views or interests.

	28. May an employee use an agency contractor to perform personal work?

	It depends.  Certainly, an employee could not have a contractor perform private 
work under the agency's own contract.  At the very minimum, this would violate 
5 C.F.R. &#167; 2635.704.  However, if the employee entered into an agreement to hire the 
contractor, and paid the full market value for any goods and services, there would not 
be a prohibited gift.  5 C.F.R. &#167; 2635.203(b)(9).  Nevertheless, the employee should be 
particularly careful to make sure that he actually pays market value, which is defined as 
what the employee would have to pay, at retail cost, for similar goods or services of like 
quality: it must be clear that it is an arm's length transaction, under standard terms.  
Additionally, if the employee is actually working on an agency contract involving the 
contractor, the employee needs to be careful not to create the appearance that he is in 
anyway using his authority over the contractor to induce or coerce the contractor into 
providing services or favorable treatment.  5 C.F.R. &#167;&#167; 2635.702(a); 2635.202(c)(2).  
Furthermore, if the personal work involves anything other than a routine consumer 
transaction, the employee will have a "covered relationship" with the contractor that 
could require the employee's recusal from agency matters involving the contractor 
under 5 C.F.R. &#167; 2635.502(a); other circumstances also could raise impartiality concerns 
under 5 C.F.R. &#167; 2635.502(a)(2).  For all of these reasons, employees should exercise 
great care if they want to hire an agency contractor for outside personal business.

Example:  An agency employee works in a large office that receives IT support under an 
agency-wide contract.  The employee does not place task orders under the contract and 
does not have any other procurement duties.  He occasionally receives support from 
contractor employees when he reports computer problems to the executive officer for his 
office.  On one occasion, he asks a contractor employee whether his company does any 
residential work, and the contractor employee gives him a telephone number for the 
residential services division of the company.  The employee calls this number and 
arranges for a technician to do some private work on the employee's home computer, for 
which he pays the standard residential rate.  This arrangement would not violate 
5 C.F.R. 2635, Subpart B, nor does it appear to be impermissible under Subpart G.  
Moreover, because the relationship with the contractor involves a routine consumer 
transaction, the employee would not have a "covered relationship" under Subpart E.

Example:  In the preceding example, the employee is the contracting officer.  He has been 
having problems with his daughter's laptop computer and brings it into the office.  He 
asks one of the contractor employees with whom he works if he has any time to look at the 
laptop.  The contractor employee takes the laptop home and in a few minutes fixes what 
he determines to be an easy problem.  He says it was "no big deal" and tells the employee 
not to worry about paying anything.  The employee has received a gift from a prohibited 
source.  Moreover, given the contracting officer's authority over the contractor and the 
circumstances in which he asked for help, there could be an appearance that he used his 
official position to induce or coerce the contractor employee to provide this service.  If the 
employee had actually used the agency contract to have this personal work done, at a 
minimum, he would have violated 5 C.F.R. &#167; 2635.704.


V. Miscellaneous Ethics Questions

        The Questions below deal with various subjects that can arise in connection with 
employees who work on contract matters or work closely with contractor personnel.

	29. May an agency employee raise funds for his favorite charity from a 
contractor employee with whom he works?

	No.  Employees may engage in personal fundraising, with certain limitations.  
One limitation is that employees may not personally solicit funds or other support for a 
charity from a prohibited source, including an agency contractor or its employees.  See 
5 C.F.R. &#167; 2635.808(c).  (An employee does not violate this rule, however, if the 
solicitation is made to a large group through the media, oral remarks, or mass mailings, 
as long as the solicitation is not targeted at prohibited sources.)  The prohibition 
includes even fundraising on the employee's own time and outside the Federal 
workplace.

Example:  An agency employee is assigned to work at a contractor's site.  He has become 
quite friendly with several contractor employees, with whom he has daily interactions 
and discusses various personal and professional issues.  He is active in a local historic 
preservation society, which is conducting its annual fund drive.  He knows that one 
contractor employee has a particular interest in historic preservation issues.  The agency 
employee may not ask the contractor employee if he would like to make a donation.

	Note that some agencies have authority to engage in "official" fundraising, and 
there is no general prohibition on official solicitation of prohibited sources by agency 
employees carrying out their authorized official duties.  See 5 C.F.R. &#167; 2635.808(b).  
However, individual agencies may have policies or practices limiting official solicitation 
of prohibited sources.

	30. Are there limits on the kinds of official information a Government 
employee may share with a contractor or contractor employee?

	Yes.  A Government employee may not allow the improper use of nonpublic 
information to further the private interest of another person, including a contractor or 
contractor employee.  5 C.F.R. &#167; 2635.703.  This includes any information about a 
contract that the employee gains through his job and that he reasonably should know 
has not been made available to the public.  Additionally, the Procurement Integrity Act 
has restrictions covering specific types of procurement information: contractor bid or 
proposal or source selection information prior to the award of an agency procurement 
contract; the disclosure of such information is subject to criminal as well as civil 
penalties, and also can result in various administrative actions.  41 U.S.C. &#167; 423(a), (e).  
In some situations, other laws may prohibit the disclosure of certain information.  E.g., 
18 U.S.C. &#167; 1905 (Trade Secrets Act); 5 U.S.C. &#167; 552a (Privacy Act).

Example:  An employee has nonpublic information that his agency is deliberating the 
termination a particular contract.  The employee has become friends with a contractor 
employee who would be affected if the contract were terminated.  The agency employee 
would like to share this information with the contractor employee so he can start making 
new career plans.  The agency employee is prohibited by 5 C.F.R. &#167; 2635.703 from doing 
so.

	31. Are there limits on an employee's ability to benefit personally from 
information pertaining to a contract or potential contract?

	Yes.  A Government employee may not use nonpublic information to engage in 
any financial transaction or otherwise to further his own private interest.  5 C.F.R. 
&#167; 2635.703.  

Example: An agency employee has access to nonpublic information concerning the likely 
award of a large contract to a company.  He may not rely on this information to buy stock 
in the company or advise others (such as family or friends) to do likewise.  Apart from the 
ethics rules, such conduct also could violate Federal securities statutes. 



	32. May an employee "moonlight" for an agency contractor?

	Maybe.  As discussed in Question 14 above, an employee may not participate 
personally and substantially in any contract or other particular matter in which his 
outside employer has a financial interest.  18 U.S.C. &#167; 208.  In some cases, the necessary 
recusal would impair the employee's ability to do his job or the agency's ability to 
accomplish its mission.  In such cases, the agency may prohibit the outside 
employment. 5 C.F.R. &#167;&#167; 2635.802(b); 2635.403(b).  

Example:  An agency employee is the contracting officer's technical representative 
(COTR) on a particular contract.  Service as COTR on this contract is the primary duty 
of the employee's position.  The employee also happens to be a certified public accountant, 
and he is always looking for opportunities to stay current with his accounting skills.  He 
learns that the contractor is looking for a part-time accountant to work on a totally 
different contract involving a private sector client.  The agency determines that the 
employee could not engage in this outside employment because the necessary recusal 
would make it impossible for him to continue as the COTR. 

	Even if any employee does not have official duties involving a particular agency 
contractor, there may be some limitations on his outside activities.  Employees may not 
engage in outside activities that create the appearance that they are using their public 
office for private gain.  5 C.F.R. &#167;&#167; 2635.702; 2635.801(c); see OGE DAEOgram DO-04-
011, http://www.usoge.gov/daeograms/dgr_files/2004/do04011.pdf.

Example: An employee is an expert on his agency's procurement policies and practices 
and is generally familiar with the typical procurement needs of various offices.  A 
company would like to hire him as a consultant to help develop a business plan for 
marketing products to his agency.  Even though the employee's official duties do not 
involve any current contract with this company, he may not accept this offer.  The 
circumstances would create the appearance that the employee obtained this outside 
employment opportunity because of his official position and would be using his position 
for the private advantage of the company.

	Employees also must be aware that criminal statutes, 18 U.S.C. &#167;&#167; 203 and 205, 
prohibit them from representing any contractor in dealings with the Government.  For 
the reasons discussed above in Question 8, these prohibitions can extend even to certain 
communications made during the course of performing work under the Government 
contract.

Example: An employee of the Environmental Protection Agency (EPA) has taken a part-
time job with a Navy contractor.  The outside job does not involve any interaction with 
EPA, and it does not even involve the same subject matter as the employee's EPA duties.  
Nevertheless, the employee may not make any representational contacts with the Navy on 
behalf of the contractor.

	Finally, some agencies have supplemental standards of conduct regulations 
pertaining to outside employment with certain entities.  In some cases, agency 
supplemental regulations may prohibit certain outside employment with an agency 
contractor (or potential contractor).  E.g., 5 C.F.R. &#167;&#167; 6901.103(c)(1) (NASA); 
5501.106(c)(1)&(2) (HHS).  Employees also must follow any agency prior approval 
requirements for outside activities; even if the agency has no such prior approval 
requirements, usually it would be prudent for an employee to seek advice from an 
ethics official prior to engaging in outside employment for an agency contractor.

	33. May an employee contract with the Government or own businesses that 
do?

	Generally no.  The general policy under the Federal Acquisition Regulation 
(FAR) prohibits a contracting officer from awarding a contract to a Government 
employee "or to a business concern or other organization owned or substantially owned 
or controlled by one or more Government employees."  48 C.F.R. &#167; 3.601.  (Somewhat 
lesser restrictions apply to contracts with special Government employees.)  Although 
this is not an OGE ethics rule, it is clear that the FAR provision is intended to avoid any 
employee "conflict of interest" as well as "the appearance of favoritism or preferential 
treatment by the Government toward its employees."  Id.  An exception may be granted 
by the agency head or a designee no lower than the head of the contracting activity, 
"only if there is a most compelling reason to do so, such as when the Government's 
needs cannot reasonably be otherwise met."  48 C.F.R. &#167; 3.602.

	Additionally, it is important to remember that criminal statutes, 18 U.S.C. &#167;&#167; 203 
and 205, may prohibit an employee from communicating with the Government about a 
contract.  These statutes do not prohibit self-representation, so an employee acting 
strictly as a sole proprietor could freely communicate with the Government about a 
contract.  However, in many cases, an employee may have formed a separate business 
entity, such as a corporation, partnership or limited liability company (LLC); in such 
cases, the employee would be prohibited from representing the entity in connection 
with a Government contract.

Example:  A Government employee wants to submit a proposal to another agency to 
provide certain consulting services.  He would be submitting the proposal on his own 
behalf as an individual.  Sections 203 and 205 would not prohibit him from doing so.  He 
is also considering establishing his own consulting company as a corporation.  He may 
not personally submit a proposal to the Government or make any other representational 
contact on behalf of the corporation.  The corporation may communicate with the 
Government through other persons, such as its employees or an attorney, provided that 
the communication is not intended to attribute any information to the Government 
employee.  In any case, the Federal Acquisition Regulation may prevent the contracting 
officer from awarding the contract to the Government employee or his corporation.

	34. May an employee provide a letter or other statement discussing the quality 
of a particular contractor's performance?

	Maybe. The OGE rule on endorsements, 5 C.F.R. &#167; 2635.702(c), generally 
prohibits an employee from using his official position, title or authority to endorse any 
product, service or enterprise.  Therefore, statements commending the performance of a 
contractor or a contractor's products generally are not permissible.  However, the rule 
does not prohibit an employee from making a simple factual statement that the 
contractor's work satisfied the Government's requirements.  (Note also that OGE does 
not view its endorsement rule as applying to authorized agency actions; rather, the 
prohibition generally is focused on the personal, unauthorized conduct of individual 
employees who abuse their position to make endorsements.)  In addition to 
section 2635.702, there may be other policies or procedures, such as agency 
procurement or public affairs policies, that limit the situations in which an employee 
may make statements about a contractor's performance.  Therefore, employees should 
consult with the contracting officer or an agency ethics official.

Example:  A contractor asks an employee for a letter stating that the contractor performed 
all its work under a particular contract.  After consulting with the contracting officer, the 
employee provides a statement indicating that the contractor met all benchmarks, 
submitted all reports, and delivered a fully operational product to the agency.  This would 
not be a prohibited endorsement, even if it is anticipated that the contractor will share the 
letter with prospective customers.

______________________________

DAEOgram DO-06-023
http://www.usoge.gov/daeograms/dgr_files/2006/do06023.txt