Conflict Of Interest Laws: Do They Bind Congress?

Conflict-of-interest laws are an important aspect of maintaining ethical standards in government. While there is no uniform standard of exemption, these laws aim to prevent public officials from using their positions for personal gain and ensure undivided loyalty to the government. Members, officers, and employees are generally prohibited from engaging in outside activities that create a conflict of interest or give the appearance of one. Disclosure requirements and recusal rules are in place to address potential conflicts, with varying restrictions on outside employment, compensation, and involvement in certain decisions. The effectiveness of conflict-of-interest laws relies on vigorous administration and personal commitment to ethical conduct by government leaders.

Restrictions on lobbying by former federal government employees

Former federal government employees are subject to a set of restrictions on lobbying activities, known as the "post-employment restrictions". These restrictions aim to prevent the appearance of special access or treatment for outside entities through the influence of former government employees. The restrictions are outlined in 18 U.S.C. § 207 and were enacted by the Ethics Reform Act of 1989, with amendments made by the Honest Leadership and Open Government Act of 2007.

The post-employment restrictions impose a one-year "cooling-off period" on former government employees, during which they are prohibited from seeking official action or communicating with current officials with the intent to influence them. This includes seeking official action from current Members, officers, or employees of the Senate or House, as well as employees of other legislative offices. The restrictions also prohibit representing, aiding, or advising a foreign government or foreign political party before any federal official with the intent to influence their decision.

For House staff, the restrictions apply if they were employed for at least 60 days in the year preceding termination and were paid at a rate equal to or greater than 75% of Members' pay. The threshold rate for employees of other legislative offices is level IV of the Executive Schedule. Violation of these post-employment restrictions is a felony and can result in imprisonment, fines, or both.

In addition to the federal restrictions, there are also specific rules and standards of conduct for the U.S. Senate. Senate Rule 37.1 prohibits Members, officers, and employees from using their official positions for personal gain. This includes deriving financial benefit directly or indirectly from their official positions. Senate Rule 37.4 prohibits the introduction or aid in the passage of legislation for personal financial gain or the financial interest of a limited class. Senate Rule 37.7 requires committee employees compensated above a certain amount to divest from any substantial holdings that may be affected by their employing committee's actions.

Furthermore, Senate Rule 37.2 prohibits Members, officers, and employees from engaging in outside business or professional activities that conflict with their conscientious performance of official duties. This includes any activities that create a conflict of interest or the appearance of a conflict of interest with their Senate duties. Outside activities must be reported in writing to the supervising Senator or officer, who is responsible for taking action to avoid any conflicts.

Overall, these restrictions aim to maintain the integrity of the legislative process and ensure that government employees act in the public interest rather than for personal gain.

Recusal requirements for officials with conflicts of interest

The recusal requirements for officials with conflicts of interest vary across different government bodies and positions. Here is a summary of the recusal requirements for officials in the Department of Energy (DOE) and Environmental Protection Agency (EPA), National Institutes of Health (NIH), and the U.S. Senate and House of Representatives:

Department of Energy (DOE) and Environmental Protection Agency (EPA)

The DOE and EPA require their political appointees to disqualify themselves from matters that might present conflicts between their personal interests and governmental responsibilities. This process is referred to as "recusal" in federal conflict-of-interest regulations. About 76% of appointees in the Bush Administration and 86% in the Clinton Administration had documented recusal obligations.

The recusal process typically involves the appointee not participating in the matter affected by the conflict of interest. In some cases, appointees may be granted a waiver to participate in the matter despite the conflict. Recusals can be temporary, pending divestiture or waiver of financial interests.

National Institutes of Health (NIH)

NIH has several methods to inform senior employees about recusal, including annual ethics training, pre-employment financial disclosure review, and various ethics forms. However, the NIH policy manual is contradictory on whether senior employees must submit written recusals and notify their supervisors. For example, there are conflicting sections regarding employees seeking non-government employment, with one stating that the employee "must" submit a written recusal and their supervisor "should" be notified, while another states it "may" be done in writing and the supervisor "must" be notified if not written.

The two definitions of recusal in the policy manual also imply that written recusals are required but do not explicitly state this, nor do they mention notifying supervisors. As a result, senior employees may receive varying instructions from different sections of the policy manual or from different ethics officials.

U.S. Senate

The U.S. Senate prohibits members, officers, and employees from using their official positions for personal gain and from engaging in outside activities that create conflicts of interest with their Senate duties. Senate Rule 37 outlines various restrictions related to outside business or professional activities, officer and board service, employment negotiations, and post-employment restrictions.

Regarding recusal, Senate Rule 37.4 states that no member, officer, or employee shall knowingly use their official position to introduce or aid the progress of legislation that furthers their financial interest or that of a limited class to which they belong.

Additionally, Senate Rule 37.7 requires committee employees compensated above a certain threshold to divest from any substantial holdings that may be directly affected by the actions of their committee, unless the Ethics Committee grants permission to retain such holdings.

U.S. House of Representatives

The House of Representatives requires members, officers, and certain employees to annually disclose personal financial interests, including investments, income, and liabilities, to monitor and deter possible conflicts of interest. This public financial disclosure is intended to provide transparency and allow constituents to judge their officials' conduct in light of possible financial conflicts.

Outside employment for government employees

Employees must also seek prior written approval from a Departmental or bureau ethics counsellor before engaging in employment with a prohibited source. A prohibited source is defined as any person, company, or organization that is seeking official action by the employee's agency, does business with the agency, or is seeking to do business with the agency. Employees are also prohibited from engaging in any form of fundraising in the workplace, unless permitted by law, regulation, or special authority.

There are also restrictions on the amount of outside income that can be earned. For example, employees may not receive compensation for speaking, writing, or teaching that relates to their official duties. They are also prohibited from receiving compensation for the representation of anyone before an agency or court of the Federal Government on a matter in which the US is a party or has a substantial interest.

There are additional rules for specific professions, such as legal and medical professionals, and for senior-level employees. For instance, employees must obtain written approval to engage in the private practice of law, whether compensated or uncompensated. There are also rules regarding the personal use of government property, fundraising, supplementation of government salary, and financial transactions.

Overall, while outside employment is permitted for government employees, there are extensive regulations and limitations that must be followed to avoid conflicts of interest and maintain ethical standards.

Disclosure of personal financial interests

Members of Congress are required to disclose their personal financial interests, including investments, income, and liabilities, on an annual basis. This requirement applies to both the House and the Senate, and is intended to monitor and deter potential conflicts of interest that may arise due to outside financial holdings.

The Ethics in Government Act (EIGA), Senate Rule 34, and Senate Rule 41 mandate that Members, officers, certain employees, and candidates file public Financial Disclosure Reports with the Secretary of the Senate, Office of Public Records. The Stop Trading on Congressional Knowledge Act (STOCK Act) further requires the Senate to maintain an electronic filing system for these reports, which can be accessed at efd.senate.gov.

Public disclosure of assets, financial interests, and investments has been a requirement since at least 1978 when the Senate Code of Official Conduct was adopted. It is regarded as the preferred method of monitoring possible conflicts of interest, as it allows constituents to judge their representatives' official conduct in light of their private financial holdings.

The following individuals must file Financial Disclosure Reports:

• Employees paid at or above the filing threshold (120% of the basic rate of pay for GS-15 of the General Schedule, which was $147,649 for 2024)
• Part-time employees whose rate of pay, adjusted to reflect full-time service, is at or above the filing threshold
• Employees of multiple Senate offices with a combined rate of pay from all sources at or above the filing threshold
• Employees who receive bonuses that increase their pay to a rate at or above the filing threshold for at least 60 days in a calendar year, and whose gross pay for that year is also at or above the threshold
• Re-employed annuitants
• Fellows and detailees paid at or above the financial disclosure threshold
• Certain employees of other Legislative Branch offices, including the Government Accountability Office (GAO) and the Office of the Attending Physician
• Political Fund Designees (PFDs)
• Principal Assistants of Members who do not have an employee paid at or above the filing threshold
• Candidates for Federal office who have received or made expenditures or contributions aggregating in excess of $5,000

It is important to note that public disclosure is meant to balance the privacy rights of individuals with the need to inform the public and deter conflicts of interest. The disclosure requirements aim to include only those items relevant to potential conflicts of interest and avoid unnecessary invasions of privacy.

Gifts to government employees

Conflict of interest laws apply to government employees at both the federal and state levels. These laws are designed to prevent employees from using their positions for personal gain and to maintain public trust in government institutions. Here are some key points regarding gifts to government employees:

Federal Level

At the federal level, employees are prohibited from soliciting or accepting gifts given because of their official position or from prohibited sources. Prohibited sources include individuals or organizations that have or seek official business with the employee's department, are regulated by the department, or have interests that may be substantially affected by the employee's official duties. Gifts from foreign governments are also generally banned. However, there are certain exceptions, such as gifts from family or friends based on a personal relationship, gifts of $20 or less per occasion (not exceeding $50 per year from one source), and certain awards and honorary degrees. Employees should also consider declining gifts that may create the appearance of impropriety, such as those with high market value or given by individuals with interests that may be affected by the employee's duties.

State Level

At the state level, conflict of interest laws vary but generally restrict gifts and gratuities that public employees can receive. For example, in Massachusetts, public employees are prohibited from requesting or receiving anything of substantial value ($50 or more) in exchange for an official act, because of their official position, or from lobbyists. However, there are exemptions for certain types of gifts, such as travel expenses related to legitimate public purposes and incidental hospitality at charitable events. Employees may also need to file disclosures for gifts worth less than $50 if there is a potential for undue influence or impartiality.

Disclosure and Reporting

Both federal and state employees are often required to disclose gifts they receive to maintain transparency and compliance with conflict of interest laws. For example, federal employees must submit confidential disclosures to their delegated managers, while Massachusetts state employees may need to file disclosures with their appointing authority or in a public manner, depending on their role. These disclosures help ensure that gifts are appropriately reported and managed to avoid any potential conflicts of interest.

Frequently asked questions