Laws, Rules, and Standards of Conduct
Below is a condensed version of this topic; for complete guidance please refer to the House Ethics Manual, Chapter 5 on outside employment and income.
- Prohibition Against Use of One’s Position With the House for Personal Gain
- Rules on Receipt of Honoraria
- Gift Rule Applicability to Compensation and Other Things of Value Received From an Outside Employer
- Prohibition Against Use of Congressional Office Resources
- Prohibition Against Representing Other Before Agencies or in Court Cases in Which the Government Is a Party or Has an Interest
- Contracting With the Federal Government
- Dual Federal Government Employment
- Holding Local Office
- Prohibition Against Receiving Compensation from a Foreign Government
- Additional Considerations Applicable to Staff Outside Employment
- Negotiating for Future Employment
It is fundamental that a Member, officer, or employee of the House may not use his or her official position for personal gain, including any gain that would accrue to the individual in the form of compensation for outside employment activities. A key provision of the House Code of Official Conduct (House Rule 23, cl. 3) provides that a House Member, officer, or employee
may not receive compensation and may not permit compensation to accrue to his beneficial interest from any source, the receipt of which would occur by virtue of influence improperly exerted from his position in Congress.
As noted in the debate preceding adoption of this rule, an individual violates this provision if he uses “his political influence, the influence of his position . . . to make pecuniary gains.”1 Members and staff, when considering the applicability of this provision to any activity they are considering undertaking, must also bear in mind that under a separate provision of the Code of Official Conduct (House Rule 23, cl. 2), they are required to adhere to the spirit as well as the letter of the Rules of the House. In any event, the Standards Committee routinely advises Members and staff to avoid situations in which even an inference might be drawn suggesting improper conduct.
In addition, the Code of Ethics for Government Service, which applies to House Members, officers, and employees, provides (at ¶ 5) that a federal official should never accept “benefits under circumstances which might be construed by reasonable persons as influencing the performance” of official duties. The Committee found that this standard was violated, for example, when a Member persuaded the organizers of a privately held bank to sell him stock while he was using his congressional position to promote authorization for the establishment of the bank.2 The Member also sponsored legislation to remove restrictions on the development of property in which he had a personal financial interest. Thus, the Member was found to have wrongly used his official position for personal benefit.
In the same vein, the Code of Ethics for Government Service affirms (in ¶¶ 8 and 10) that “public office is a public trust,” and provides that a federal official should “[n]ever use any information coming to him confidentially in the performance of governmental duties for making private profit.”
One of the purposes of these rules and standards is to preclude conflicts of interest. Although the term “conflict of interest” may be subject to various interpretations in general usage, under federal law and regulation, this term “is limited in meaning; it denotes a situation in which an official’s conduct of his office conflicts with his private economic affairs.”3 The ultimate concern “is risk of impairment of impartial judgment, a risk which arises whenever there is a temptation to serve personal interests.”4
These rules and standards are applicable in a wide range of circumstances relating to outside employment. When there is a potential for a conflict of interest to arise in connection with one’s outside employment or other activities, it would be advisable to consult with the Standards Committee before accepting the position. For example, a conflict of interest may arise when the prospective outside employer is an entity with interests before Congress. In no event may a Member, officer, or employee participate in lobbying or advising on lobbying of either Congress or the Executive Branch on behalf of any private organization or individual, even on an uncompensated basis, as that would conflict with a Member’s general obligation to the public.5 Other circumstances that implicate these rules and standards of conduct are discussed below, regarding receipt of excessive compensation, Member official activities on matters affecting their personal interests, outside employment of one’s spouse, conflict-of-interest concerns for staff members, and seeking future employment.
With regard to the outside employment of a staff person, it may be possible for conflict-of-interest concerns to be alleviated through a requirement that the staff person have no involvement in any matter coming before the congressional office that would be of interest to his or her outside employer. However, in some circumstances, such a requirement either is not feasible or would not be sufficient to satisfy the applicable rules and standards. In those circumstances, there may be no alternative to the staff person declining or terminating the outside employment.
Example 1. A newly-hired legislative assistant in a Member’s office who had worked for a consulting and lobbying firm in Washington wishes to continue to work for that firm on a part-time basis. His congressional pay is below the senior staff rate. The federal issues on which he would work for the firm are different from those for which he has responsibility in the congressional office, and he would not engage in any lobbying for the firm. Notwithstanding the proposed limitations on his work for the firm, he may not accept any part-time employment with that firm, as it would violate the general principle that Members and staff are not permitted to lobby Congress.
Example 2. A Member is considering hiring an individual who is a professional grant writer to research and handle constituent grant requests in his district office. The individual would like to continue to operate her grant-writing business on a part-time basis. Because there would likely be, at a minimum, an appearance of use of her official position for personal gain in such circumstances, she must discontinue her outside business upon accepting employment in the congressional office.
Example 3. An outside organization that operates a congressional internship program offers a congressional staff member part-time employment as director of that program. Because such a position would likely require use of contacts and information gained through the individual’s employment with the House, the offer must be declined.
At times a Member or staff person wishes to engage in outside employment that involves the selling of goods or services. On the basis of the rules and standards of conduct set out above, a Member should not undertake any outside employment that would involve the Member personally in the selling or endorsement of any goods or services. On the same basis, at a minimum, any staff person who engages in sales may not solicit purchases from either (1) any non-congressional person with whom the employee came into contact through the congressional office or who has interests before the congressional office, or (2) any subordinate staff in his or her congressional office. In addition, in soliciting sales, House employees may not, directly or indirectly, identify themselves as congressional staff, refer to their congressional duties, or otherwise make use of their status as a congressional employee.
The Standards Committee is available to advise Members, officers, and employees on the applicability of the rules and standards of conduct in other specific circumstances.
Under House Rules, Members, as well as House officers and employees who are paid above the “senior staff” rate (for 2008, anyone paid at or above $114, 468), are prohibited from receiving any honoraria.6 An honorarium, as defined in the rules, is “a payment of money or a thing of value for an appearance, speech, or article” (House Rule 25, cl. 4(b)). The House Rules further provide that an officer or employee who is paid below the senior rate may accept an honorarium, unless any one of three circumstances is present:
- The subject matter of the speech, article, or appearance is directly related to the official duties of the individual;
- The payment is made because of the status of the individual with the House; or
- The person offering the honorarium has interests that may be substantially affected by the performance or nonperformance of the official duties of the individual (House Rule 25, cl. 1(a)(2)).
Example 4. A teacher’s union offers a staff member who works on education issues $2,000 to write an article for the union newsletter on legislative initiatives to improve the quality of public education. The employee may write the article, but regardless of her House salary level, she may not accept any payment.
Example 5. A staff member writes an article on rare butterflies for a nature magazine. He writes the article in his spare time, using his home computer. The subject of the article has nothing to do with his official duties or status, and the magazine has no interests that could be substantially affected by the performance of his official duties. If the employee’s House pay is below the senior staff rate, the honorarium rules do not prohibit him from accepting an otherwise permissible payment for the article from the magazine. However, if his House pay is at or above the senior staff rate, he may not accept any payment for the article.
Definitions. The Committee defines the terms “speech,” “appearance,” and “article” as follows:
- A speech means an address, oration, talk, lecture, or other form of oral presentation, whether delivered in person, transmitted electronically, recorded, or broadcast over the media, but does not include teaching in an established educational program that conforms to teaching criteria established by the Committee (see section on “Requirement for Prior Committee Approval of Compensation for Teaching,” below).
- An appearance means attendance at a public or private conference, convention, meeting, social event, or similar gathering, possibly but not necessarily involving incidental conversation, discussion, or remarks.
- An article means a writing that has been or is intended to be published, for which a payment, if made, would be other than a royalty received from an established publisher pursuant to usual and customary contractual terms. The term includes an article that is to be published in the name of another person (i.e., a “ghost-written” article).
Occasionally House employees are invited to participate in a focus group and are offered a fee if they agree to participate. When the invitation is extended because of the individual’s position with the House – and it must be assumed that any such invitation that is received in the congressional office is extended on that basis – the employee may not accept the fee, regardless of the level of his or her House pay. Participation in the focus group would constitute an appearance for purposes of the honoraria rules, and acceptance of payment for that appearance would therefore be prohibited.
The term “honorarium” is defined as a payment of money or thing of value for an appearance, speech, or article (House Rule 25, cl. 4(b)). However, explicitly excluded from the definition of this term is “any actual and necessary travel expenses incurred by [a] Member . . . officer, or employee (and one relative)” in connection with the appearance, speech, or article “to the extent that such expenses are paid or reimbursed by any other person.” The rule further provides that for purposes of the rules, the amount of any honorarium is to be reduced by the amount of any such expenses to the extent that they have not been paid or reimbursed by anyone else.
Exclusions. Speaking, appearing, and writing are integral to many jobs. Most jobs require the employee to “appear” at the work site in order to perform. The honoraria rules clearly do not preclude outside employment merely because the employee must show up to do the work. The Committee has determined that the following types of compensation are not honoraria. However, Members, officers, and employees who are paid at or above the senior staff rate should bear in mind that any such compensation that they receive is subject to the outside earned income limitation discussed later in this chapter.
- Compensation for activities when speaking, appearing, or writing is only an incidental part of the work for which payment is made (e.g., conducting research) is not an honorarium.
- Bona fide awards and gifts generally are not honoraria. If a Member, officer, or employee is presented with an award, memento, or gift at an event, the Committee does not consider the object to be an honorarium, unless it is specifically given in consideration of the speech or appearance. Similarly, an individual may accept an award for artistic, literary, or oratorical achievement made on a competitive basis under established criteria. Of course, either such item must otherwise be acceptable under the gift rule.
- Paid engagements to perform or to provide entertainment when the artistic, musical, or athletic talent of the individual is the reason for the employment, rather than the person’s status as a Member or employee of Congress are not honoraria.
- Witness and juror fees by a court or other governmental authority are not honoraria. However, under a Committee on House Administration rule that implements statutory law (2 U.S.C. § 130b), a House employee must remit to the House Finance Office any fee that he or she receives for service as either a juror in a United States or District of Columbia court or as a witness on behalf of the United States or the District of Columbia.
- Fees to a qualified individual for conducting worship services or religious ceremonies (but not for delivering speeches or invocations at religious conventions) are not honoraria.
- Payments for works of fiction, poetry, lyrics, or script, when the payment is not offered because of the author’s congressional status are not honoraria.
- Salary or wages pursuant to an employer’s usual employee compensation plan when paid by the employer for services on a continuing basis that involve appearing, speaking, or writing are not honoraria. Any Member, officer, or employee considering entering into such an arrangement should first contact the Standards Committee for guidance. This exclusion does not apply to any arrangement with an agent, speakers bureau, or similar entity that facilitates appearances or speaking or writing opportunities.
Thus, not all jobs that involve speaking, appearing, or writing are barred. Conducting religious ceremonies plainly involves speaking, yet qualified Members and staff may still accept compensation for these services. The fact that a speech is made before a religious group or at a religious convention, however, will not suffice to remove it from the ban. Similarly, a Member may not accept a fee merely for offering an invocation at the beginning of an event.
Writers, too, may continue to ply their craft in many ways. If the writing is not for publication, or the writing is an incidental part of a job, payment may still be permitted. Congressional authors of fiction, poetry, lyrics, or scripts may accept compensation.
Prior to 1999, House Members and staff were, in certain circumstances, allowed to accept a stipend, defined as payment for a series of at least three appearances, speeches, or articles. Under the rules then in effect, such a payment was acceptable unless either the subject matter of the appearances, speeches, or articles was directly related to the individual’s official duties, or the payment was made because of his or her status with the House.15 However, an amendment to the House Rules adopted at the beginning of the 106th Congress abolished the exclusion for such “stipends.” That amendment expanded the definition of the term “honorarium” in the rules to include any payment for any “series of appearances, speeches, or articles” (House Rule 25, cl. 4(b)).
Example 6. A staff member has an outside part-time job with a local university, the duties of which include research and analysis on subjects unrelated to her official duties. In order to inform her faculty supervisor of her findings, she must write them up. Since the writing is incidental to her primary responsibilities, her acceptance of compensation for her services is not prohibited by the honoraria rules.
Example 7. A staff member was a music major in college and is an accomplished violinist. He is occasionally invited to play with the local symphony orchestra at evening and weekend concerts and is compensated at the same rate as other musicians of his caliber in the community. Provided that he is hired based on his talent and not his status as a congressional employee, his acceptance of compensation for these performances is not prohibited by the honoraria rules.
Example 8. A staff member works part-time in evenings and on weekends playing the piano. In the course of lobbying her on some legislation, a lobbyist learns of her avocation and, without knowing anything about her musical abilities, offers to hire her to play at his firm’s Christmas party. He offers to pay her twice the going rate for such an engagement. The staff member must decline the offer.
Example 9. A staff member writes a fictional story that is published by a children’s magazine. Since it is a work of fiction, his acceptance of payment for the article is not prohibited by the honoraria rules.
Example 10. A Member who is a retired professional athlete is invited to appear at a sports-related event to sign autographs. The contract provides that he must sign 500 autographs and for doing so will be paid a fee of $2,000. Because the payment is explicitly based on the number of autographs to be signed, the Member’s acceptance of the fee is not prohibited by the honorarium rules.
Example 11. A philatelic magazine requests that a staff member who is paid at the senior staff rate write a series of articles on stamp collecting. Even though stamp collecting is unrelated to the staff member’s official duties and status, and the magazine has no interests that could be affected by her performance of her official duties, the staff member may not, under the current honoraria rules, accept the payment for the series, because as senior staff she is subject to the absolute ban.
Donations to Charity. Under House rules, the sponsor of a speech, appearance, or article may make a payment in lieu of an honorarium to a charitable organization on behalf of a Member, officer, or employee (House Rule 25, cl. 1(c)). The sponsor may make a donation of up to $2,000 per speech, appearance, or article, as long as the sponsor makes the payment directly to the charitable organization. Even if the sponsor makes the check payable to the charity, the Member or staff person may not accept the check and personally forward it to the charity.
The Member or staff person may suggest a particular charitable organization to receive the donation, within the following limits. The term “charitable organization” as used in the rule means an organization described in § 170(c) of the Internal Revenue Code.16 The individual may not receive any tax benefit from the donation. Accordingly, the individual may neither add the donation to income nor deduct it for income tax purposes (26 U.S.C. § 7701(k)). The charity may not be one from which the individual or his or her immediate family (parent, sibling, spouse, child, or dependent relative) derives any financial benefit (House Rule 25, cl. 1(c)).
Thus, when the Member, staff person, or family member draws a direct financial benefit (such as a salary) from a particular charity, the Member or staff person may not designate that charity to receive payments in lieu of honoraria. In the case of a national or international charity, however, the fact that a family member works for a local unit would not preclude a Member or staff person from designating the parent organization. Any remote benefit to the family member from the donation in that situation would be too indirect to fall within the statute’s prohibition.
Example 12. Member A gives a speech to a trade association in New Orleans. The Committee approves the association paying the Member’s travel, food, and lodging expenses. In connection with the event, the association sends a check for $2,000 to the Boy Scouts with a note saying: “In lieu of an honorarium, Member A has asked us to make this donation to the Boy Scouts in honor of his speech to our association.” The donation on behalf of the Member is permissible under the rules.
Example 13. A Member gives a speech to a political club in Chicago. The following week, she receives a check for $1,500, payable to her, with a note from the club saying: “Thank you for addressing our club. We do not know which charities you support, so we are sending you this check, knowing that you will pass it along to some worthy organization.” The Member may not accept the check, even if she intends to endorse it over to a charity immediately. She must return the check to the club. If she wishes, she may suggest that the club donate the money to a specific charity of her choice or to any charity of the club’s choice that is qualified under § 170(c) of the tax code.
Example 14. A Member gives a speech at an executives’ roundtable in Kansas City. In honor of the event, the executives’ group presents the Member with a check for $1,000, made out to his favorite charity. He may not send the check on to the charity. The Member must return the check to the executives, who may then forward it to the charity themselves.
Example 15. A staff member writes an article that is accepted for publication by a magazine. The magazine normally would pay $500 for a comparable article and asks the staff member if he would like that amount to be donated to a charity. His favorite charity is a homeless shelter in his hometown at which his sister works for pay as a counselor. Since his sister receives a direct financial benefit from the shelter (her salary), the staff member may not designate the shelter to receive the payment from the magazine. He may designate another charity.
Example 16. A staff member writes an article that is accepted for publication by a magazine that offers to donate $500 to the charity of her choice. The staff member’s husband is a lab technician at the local Red Cross blood bank. Nevertheless, she may, if she chooses, designate the national or international Red Cross to receive the payment in lieu of honoraria.
At times Members cooperate with or help organize charitable foundations, which they designate to receive payments in lieu of honoraria and supplement with independent solicitations. Typically, these foundations attempt to address particular needs in the Member’s district (such as scholarship funds) or national problems of particular concern to the Member. A Member may designate such a foundation to receive payments in lieu of honoraria if the foundation is qualified under § 170(c) of the tax code.
The House gift rule defines the term “gift” in an extremely broad manner.18 The rule would be implicated if a Member, officer, or employee were to accept compensation for outside employment in an amount that exceeds the fair market value of the services that he or she renders. Among the relevant factors in determining that value are the specific nature of the services rendered by the individual, the amount of time that he or she devotes to the outside employment, the amount of compensation customarily paid for such services, and the individual’s qualifications to render the particular services.
In addition, a specific provision of the gift rule addresses the acceptability of “[f]ood, refreshments, lodging, transportation, and other benefits” that result from the outside business or employment activities of a Member, officer, or employee (House Rule 25, cl. 5(a)(G)(i)). Under that provision, such a benefit is acceptable only if two requirements are satisfied: (1) The benefit has not been offered or enhanced because of the official position of the Member or staff person, and (2) it is one that is “customarily provided to others in similar circumstances.”
Pursuant to federal statute (18 U.S.C. § 1301(a)), official funds may be used only for the purposes appropriated. Thus, House resources acquired with such funds – including the office telephones, computers fax machines and other equipment, office supplies, office space, and staff while on official time – are to be used for the conduct of official House business. Those resources may not be used to perform or in furtherance of any outside employment of any Member, officer, or employee. A provision of the rules issued by the House Administration Committee allows minor, incidental personal use of House equipment and supplies. However, the Standards Committee understands that this provision allows such use of those resources for personal purposes only, and does not allow their use for outside employment or business purposes.
Prohibition Against Representing Others Before Agencies or in
Court Cases in Which the Government Is a Party or Has an Interest
Federal criminal law generally prohibits Members, officers, and employees from privately representing others before the federal government. One provision bars these individuals from seeking or receiving compensation (other than as provided by law) for “representational services” before any federal government agency, department, court, or officer in any matter or proceeding in which the United States is a party or has an interest (18 U.S.C. § 203).
A second provision forbids any officer or employee from acting “as agent or attorney for anyone” (other than in the proper discharge of official duties) before any federal government entity in any particular matter in which the federal government has an interest, whether or not the individual is compensated (18 U.S.C. § 205). The individual need not actually be an attorney or have a strict common law agency relationship with another in order to be restricted by the statute.20 While House officers and employees are covered by this provision, Members are not.
In addition, a provision of the House Rules states that a person “may not be an officer or employee of the House, or continue in its employment, if he acts as an agent for the prosecution of a claim against the Government or if he is interested in such claim, except as an original claimant or in the proper discharge of official duties” (House Rule 25, cl. 6).
Under 18 U.S.C. § 203, a Member, officer, or employee of the House may not receive compensation, other than congressional salary, for any dealings with an administrative agency on behalf of a constituent or any other person or organization. Even if contacting a federal agency on behalf of a private individual or organization is within the scope of official duties, an individual who accepts additional compensation for such services has violated the law.21 In this sense, Section 203 supplements the law against illegal gratuities discussed in Chapter 2.
Section 203 prohibits the receipt of compensation “directly or indirectly” for services before federal agencies. Therefore, if a Member or staff person, whether through participation in a partnership arrangement or otherwise, shares in fees from services rendered before federal agencies, a violation of this provision may occur even if the individual did not personally perform the services.22 This same opinion notes, however, that the Office of Government Ethics has interpreted § 203 not to apply to a person who receives a fixed salary as an employee of a firm (as opposed to someone who shares in the firm’s profits), even though some of the firm’s overall income may be attributable to service covered by § 203.” 23 This provision can apply to a law firm retiree when the retiree’s pension is based on a percentage of law firm profits if any of those profits are derived from representation activities before the federal government.
Both sections 203 and 205 carry the same possible penalties: Imprisonment for up to one year (or five years if the violation is willful); a civil fine of up to $50,000 per violation or the amount received or offered for the prohibited conduct (whichever is greater); or a court order prohibiting the offensive conduct (18 U.S.C. § 216). In one case, a federal court held a former Member of Congress liable for repayment of compensation unlawfully received. The court ruled that a violation of § 203
unquestionably demonstrates a breach of trust, for in order to fall within its prohibition, a member of Congress must shed the duty of disinterested advocacy owed the government and his constituents in favor of championing private interests potentially inconsistent with this charge.24
Sections 203 and 205 exempt certain activities. Individuals may represent themselves before the federal government. They may also represent their spouse, parent, child, or any person for whom they serve as guardian, trustee, or personal fiduciary (18 U.S.C. §§ 203(d), 205(e)). Even on behalf of these people, however, the individual must refrain if the matter at issue is one in which he or she participated personally and substantially on behalf of the government or one that falls within his or her official responsibilities. The statutes also provide that a staff person who wishes to engage in excepted representational activities must have the approval of his or her employing Member. In addition, one may, without compensation, represent anyone in a disciplinary or personnel proceeding (18 U.S.C. § 205(d)).
Example 17. A staff member is a caseworker, and because of his experience in dealing with federal government agencies, his brother asks him to represent him in an FCC hearing at which the brother is contesting the agency’s denial of his license application. The staff member must decline, even if he does not receive compensation for his services.
Example 18. A staff member’s parents have a dispute with the Social Security Administration. The staff member may represent them at their hearing if her employing Member approves.
Example 19. A staff member is a tax lawyer. His college roommate has a dispute with the IRS and asks the staff member to accompany him and to assist him at the hearing. The staff member may not do so, even if he receives no compensation.
Example 20. A Member who is an attorney wishes to represent in state court, on a pro bono (unpaid) basis, union members who were charged with state law violations while picketing their employer. The Member’s uncompensated representation would not violate 18 U.S.C. §§ 203 or 205.
Paragraph 7 of the Code of Ethics for Government Service cautions all government officials not to engage in any business with the federal government, “either directly or indirectly which is inconsistent with the conscientious performance” of governmental duties. To do so would raise the appearance of undue influence or breach of the public trust.
Under the federal criminal code, a Member of Congress may not enter into a contract or agreement with the United States government. Any such contract is deemed void, and both the Member and the officer or employee who makes the contract on behalf of the federal government may be fined (18 U.S.C. §§ 431, 432). In addition, public contracting law provides that “no Member of Congress shall be admitted to any share or part of any contract or agreement with” the United States, “or to any benefit to arise thereupon” (41 U.S.C. § 22).25
The criminal law precludes Members from “directly or indirectly” holding, executing, undertaking, or enjoying “in whole or in part” any contract with the federal government. The Attorney General has interpreted this language to prohibit a general or limited partnership that includes a Member of Congress from entering into a contract with the federal government.26 In addition, it is possible that a Member of Congress who receives compensation under an independent organization’s government contract – for example, compensation in the form of a salary from the organization, or through a subcontract with it – may be deemed to be improperly benefiting from that contract.
Unlike a partnership, a corporation with a relationship to a Member of Congress may enter into a contract with the federal government for the general benefit of the corporation (18 U.S.C. § 433). Thus, a Member of Congress may be a stockholder, even a principal stockholder, or an officer of a corporation that holds a federal government contract without incurring criminal liability.27 Similarly, the spouse of a Member may enter into a contract with the federal government. Incorporating for the obvious purpose of circumventing the statute’s prohibition, however, would disqualify an entity from the § 433 exception.28 It would appear that the statutory exception in the criminal law for contracts with corporations would likewise apply to the contract law provision of 41 U.S.C. § 22, since all the provisions discussed, and the exceptions to them, were originally passed as part of the same act.29
When a Member or an entity in which a Member has an ownership interest (other than a publicly held corporation) is considering entering into a contract or agreement with a federal government agency, the Member should first consult with the agency on the possible applicability of these statutes. Similarly, a newly elected Member who has such a contract should immediately consult with the contracting agency on this point.
While these statutes do not apply to House officers and employees, the matter of government contracts with federal employees is addressed in the Federal Acquisition Regulations. The regulations provide that a contract may not knowingly be awarded to a federal employee (including an officer or employee of the House), or a firm substantially owned or controlled by one or more federal employees, except “if there is a most compelling reason to do so, such as when the government’s needs cannot reasonably be otherwise met.”30
Example 21. A federal agency is holding an auction of properties. A House Member may not purchase anything at the auction because the contract of sale would be a contract with the government.
Example 22. A Member is invited to speak at a conference sponsored by an executive branch agency. Although private sector speakers at this conference are paid a speaker’s fee, the Member may not accept payment. (Note that such a payment also would constitute a prohibition honorarium).
Comparable prohibitions on the use of Member office and committee funds are set out in rules issued by the House Administration Committee. The Member’s Handbook issued by that Committee provides that “no Member, relative of the Member, or anyone with whom the Member has a professional or legal relationship may directly benefit from the expenditure of the MRA [Member’s Representational Allowance],” unless “specifically authorized by an applicable provision of federal law, House Rules, or [House Administration] Committee Regulations.” The Committees’ Handbook provides that, subject to the same exception, “no Member of the committee, relative of a committee Member, or anyone with whom a committee Member has a professional or legal relationship may directly benefit from the expenditure of committee funds.” While the application of these rules is within the jurisdiction of the House Administration Committee, it appears that these rules preclude a Member or committee from contracting with a staff member for the acquisition of goods, or of any services outside of the employment context.
A provision of the Constitution (Article I, Section 6, clause 2) generally prohibits Members of the House (as well as the Senate) from holding any other federal office:
[N]o Person holding any Office under the United States, shall be a Member of either House during his Continuance in Office.
Decisions of the House and the House Judiciary Committee applying this provision to particular federal offices and in various circumstances are summarized in the House Rules and Manual issued by the House Parliamentarian.31
House staff persons are not absolutely prohibited from holding a non-House federal job, but a provision of statutory law severely restricts their ability to do so. Under that provision, a House employee may not hold a non-House government job if the annual pay of the two positions combined exceeds a limitation that is calculated at the beginning of each year (5 U.S.C. § 5533(c)(1)). In 2007 this combined limitation was $30,826.32 A “position” means “a civilian office or position (including a temporary, part-time, or intermittent position), appointive or elective, in the legislative, executive, or judicial branch of the Government” (id., § 5531(2)). The dual employment bar does not apply when the positions involved are expert or consultant positions and pay is received on a “when-actually-employed” basis for different days (id., § 5533(c)(4)).
The statute further provides that an individual may hold two or more House jobs, provided that the combined salary does not exceed the maximum annual rate of pay authorized to be paid out of a Member’s clerk hire allowance (id., § 5533(c)(2)).33 Thus, the law allows House employees to work part-time in a House office and allows House offices to share an employee, as long as the employee performs duties for each office that are commensurate with the compensation the employee receives from that office, and the employee’s combined House salaries do not exceed the cap.
At times House employees wish to hold an elected or appointed local government office. While no statutory provision or House rule absolutely prohibits a House employee from holding a local office while remaining on the House payroll, the applicable provisions of state or local law on eligibility for office must be consulted. In addition, House employees must take care to avoid any undertaking that is inconsistent with congressional responsibilities.
The holding of a local office by a House employee is subject to all of the restrictions and limitations on outside employment set out in this chapter. For employees who are paid at or above the senior staff rate, the limitations include the outside earned income limitation and all of the “fiduciary relationship” restrictions. As a result, a senior staff person is generally prohibited from receiving compensation for service as an elected or appointed government official. In addition, regardless of their rate of pay, all House employees must adhere to the prohibition against using any House resources to perform the duties of their local office, the requirements that those duties be performed outside the congressional office and on their own time, and the prohibition against representing anyone else – including the local government by which they are employed – before federal agencies.
Furthermore, in making public comment on issues or otherwise dealing with the public, an employee who serves in a local office should always make clear in which capacity the employee is acting. In addition, the employee is prohibited from providing any special treatment to constituents in a congressional capacity and should discourage any suggestion that they will receive preferential treatment from the employee’s congressional office.
A staff member considering running for or serving in a local office should first consult with his or her employing Member on the matter, and should refrain from doing so if the Member objects. When the demands of the local office are such that it is impossible as a practical matter for the employee to maintain an absolute separation of the two positions – or when the employing Member concludes that the two positions are incompatible – then the employee will have no alternative but to decline or terminate service in the local office, or to terminate congressional employment.
The laws, rules, and regulations governing campaign activity are discussed in detail in Chapter 4 of the House Ethics Manual on Campaign Activity. In particular, employees should be cognizant of restrictions that prohibit performing local elective service or any campaign activity for local office in House office space (including district offices), using House resources, or on official time. In addition, both federal statute and regulations of the House Building Commission prohibit any political solicitation – including one for local office – from being conducted in a House office space.34 It is also unlawful to solicit funds from other federal employees.35
For a number of reasons – including the full-time nature of the position that a House Member assumes, and provisions of the laws of various states on eligibility to hold office – questions regarding the possibility of a Member holding a local office rarely arise. While the Constitution does not prohibit House Members from simultaneously holding state or local office, the House has determined that “a high state office is incompatible with congressional membership, due to the manifest inconsistency of the respective duties of the positions.”36 Any House Member considering holding a state or local office should first consult with the Standards Committee and, when there may be a question of whether the office involved is a “high state office,” the House Parliamentarian.
The Constitution prohibits any Member or employee of the House (as well as any other federal official) from receiving an “emolument” of “any kind whatever” from a foreign government or a representative of a foreign state, without the consent of the Congress (Article I, Section 9, clause 8). As the Comptroller General has noted, “it seems clear from the wording of the Constitutional provision that the drafters intended the prohibition to have the broadest possible scope and applicability.”37 Thus, an “emolument” has been defined as any “profit, gain, or compensation received for services rendered.” 38
Although Congress has consented, in the Foreign Gifts and Decorations Act, to the acceptance by federal officers of certain gifts, no statute grants a general consent for the receipt of emoluments or other compensation from foreign governments.39 The Comptroller General has ruled that transportation or expenses for travel gratuitously given by a foreign government would fall within regulations promulgated on the receipt of foreign gifts (see Chapter 2 on gifts). However, if the travel was offered by a foreign government in return for or in connection with some service that a Member or employee would provide, such as making a speech, then such expenses could be deemed “compensation” and thus be an “emolument.”40 Note the difference between this Constitutional provision and the honoraria rules: The honoraria rules generally permit one to accept necessary travel expenses to deliver a speech; the Constitution, however, prohibits the acceptance of such expenses from a foreign government.
Members and employees may not therefore receive any payment for services rendered to official foreign interests, such as ambassadors, embassies, or agencies of a foreign government.41 Caution should thus be exercised in accepting expenses or other compensation from any foreign organization (such as a foundation) that receives sponsorship, funding, or licensing from a foreign government, because it could be considered an official arm or an instrumentality of the government. The Comptroller General has ruled, for example, that a Member of Congress could not accept a fee from the British Broadcasting Corporation for participation in a television program to discuss the American Presidency.42 The BBC, because of its funding relationship with and regulation by the British government, was considered an instrumentality of the British government, and thus a “foreign state” under the constitutional ban.
Regardless of compensation, a public official may not act as an agent or attorney for either (1) a foreign principal required to register under the Foreign Agents Registration Act of 1938, as amended, that is, generally, those individuals engaged in lobbying, political, or propaganda activities,43 or (2) a lobbyist required to register under the Lobbying Disclosure Act of 1995 in connection with the representation of a foreign entity (18 U.S.C. § 219).
Proper Performance of Congressional Duties. A House staff member who engages in outside employment may not do so to the neglect of official congressional duties, nor on “official time” for which he or she is compensated with public funds. The House Code of Official Conduct specifically provides that a Member “may not retain an employee who does not perform duties for the offices of the employing authority commensurate with the compensation he receives” (House Rule 23, cl. 8). Additionally, ¶ 3 of the Code of Ethics for Government Service instructs government employees to “[g]ive a full day’s labor for a full day’s pay.” A House employee is hired and paid from the United States Treasury for the performance of official duties. Any outside employment that would detract from the performance of, or full time and attention to, one’s government job would be contrary to these standards. When the demands of a staff person’s outside employment result in a reduction of the amount of time that he or she devotes to congressional duties, a commensurate reduction in the individual’s congressional pay is required.
Conversely, the provisions of the House Rules prohibiting unofficial office accounts generally preclude Members from accepting privately financed or unpaid services (as well as other in-kind support) for the performance of official House business (House Rule 24, cl. 1). Accordingly, a staff person should not perform congressional duties during time for which the individual is being compensated by a private outside employer, and should not use any resources of a private outside employer for the performance of congressional duties. Particularly where a staff person devotes a significant amount of time to outside employment, or engages in outside employment activities during the regular business day, he or she should keep careful time records for both positions in order to be able to demonstrate compliance with the applicable rules.
In addition, because a staff person’s specific duties and terms of employment are within the discretion of his or her employing Member, the Member’s perspective on a staff person’s outside employment – and particularly whether any specific outside employment may impair the individual’s ability to perform his or her congressional duties or would otherwise be inappropriate – is most important. For that reason, a staff person should consult with his or her employing Member or supervisor before undertaking any outside employment.
The considerations applicable to the performance of campaign work by House staff are detailed in Chapter 4 of the House Ethics Manual.
Outside Employment of Professional Committee Staff. A provision of the House Rules states that the professional staff members of each standing committee “may not engage in any work other than committee business during congressional working hours” (House Rule 10, cl. 9(b)(1)(A)). The legislative history of the provision states that its intent is to confirm that the House Rules on professional committee staff “[do] not prohibit such staff from outside employment on their own time.”44
Staff Who File Financial Disclosure Statements. A provision of the House Code of Official Conduct that was added by the Ethics Reform Act of 1989 restricts the official activities of employees who file financial disclosure forms (House Rule 23, cl. 12). These staff persons may not contact other government agencies with respect to non-legislative matters affecting their own significant financial interests. An employing Member may waive this disqualification by notifying the Standards Committee, in writing, that the Member is aware of the employee’s financial interest, but deems this person’s participation in the matter to be necessary.
Example 23. Staff person A, who is the banking expert on a Member’s staff, is part owner of a bank in the Member’s district. A new banking regulation will adversely affect all the banks in that district, and the Member wishes A to contact the banking regulators on his behalf to urge reconsideration. The Member writes to the Standards Committee stating: “I authorize my staff member, A, to contact banking authorities concerning Regulation 123. I understand that A, as part owner of Central Bank, may benefit if the Regulation is withdrawn. Nonetheless, I waive the application of House Rule 23, clause (12)(a) because A’s expertise in this area makes her participation necessary.” Upon receipt of the Member’s letter by the Committee, A is free to contact the agency.
The Committee’s general guidance regarding negotiating for non-congressional employment is that House Members and employees are free to pursue future employment while still employed by the House, subject to certain ethical constraints. However, House Rule 27, which was enacted during the 110th Congress,45 established an additional restriction for House Members. Pursuant to House Rule 27, clause 1, a Member may not “directly negotiate or have any agreement of future employment until after his or her successor has been elected” unless the Member discloses those negotiations as required by the rule. House Rule 27 also requires officers, very senior staff, and those Members who are subject to the rule to disclose to the Standards Committee any job negotiations made with a private employer while the individual is still employed by the House, as well as any recusal from official matters that is necessitated by those negotiations.
The term “negotiation” is not defined in the legislation or House rule. In its past guidance, the Committee has given deference to court decisions interpreting a related federal criminal statute. That statute (18 U.S.C. § 208) bars executive branch employees from participating in matters affecting the financial interests of an entity with which the employee is “negotiating or has any arrangement” concerning future employment. Those decisions found that the term “negotiation” should be construed broadly.46 However, the Committee makes a distinction between “negotiations,” which trigger the rule, and “[p]reliminary or exploratory talks,” which do not. “Negotiations” connotes “a communication between two parties with a view toward reaching an agreement” and in which there is “active interest on both sides.”47 Thus, merely sending a copy of one’s résumé to a private entity is not considered “negotiating” for future employment.
The general guidance applicable to all Members and House employees – regardless of salary level – who wish to engage in negotiations for future employment is as follows. First and foremost, a Member or House employee may not permit the prospect of future employment to influence the official actions of the Member or employee, or the employing office of the employee. Some Members and employees may determine to use an agent (a “headhunter”) to solicit job offers on their behalf in order to avoid any appearance of improper activity. Regardless of whether job negotiations are undertaken personally or through an agent, the following generally applicable principles must be observed.
Other, more general, ethical rules also bear on the subject of employment negotiations. The House Code of Official Conduct prohibits House Members, officers, and employees from receiving compensation “by virtue of influence improperly exerted” from a congressional position.48 Paragraph 5 of the Code of Ethics for Government Service forbids anyone in government service from accepting “favors or benefits under circumstances which might be construed by reasonable persons as influencing the performance” of governmental duties. Federal criminal law prohibits a federal official from soliciting or accepting a “bribe” – i.e., something of value given in exchange for being influenced in an official act.49 Although bribery necessarily entails a quid pro quo arrangement, the same statute also bans seeking or accepting “illegal gratuities” – i.e., anything given because of, or in reward for, a future or past official act, whether or not the official action would be, or would have been, taken absent the reward.50
In light of these restrictions, Members and employees should be particularly careful in negotiating for future employment, especially when negotiating with any individual or entity that could be substantially affected by the performance of official duties. It may be prudent for the Member or employee to have an exchange of correspondence with any serious negotiating partner, stipulating that the prospective employer will receive no official favors in connection with the job negotiations. Members and those employees who will be subject to the post-employment restrictions51 may also wish to establish in correspondence with any prospective employer that the future employer understands that (1) it will receive no official favors as a result of the job negotiations, and (2) the Member or employee is subject to post-employment restrictions, which should be briefly outlined.52 Former Members and employees who are lawyers should consult their local bar association concerning the application of rules governing their involvement in matters in which they participated personally and substantially during their time with the House.53 In addition, as addressed more fully below, Members, officers, and very senior staff must disclose the employment negotiations to the Standards Committee.
Provided that Members and employees conduct themselves in accordance with the considerations discussed above, they may engage in negotiations for employment in the same manner as any other job applicant. Discussions may specifically address salary, duties, benefits, and other terms.
Notification Requirements. Pursuant to House Rule 27, Members, officers, and very senior staff must notify the Committee on Standards of Official Conduct within three (3) business days after the commencement of any negotiation or agreement for future employment or compensation with a private entity. The notification requirement applies to all job negotiations commenced, and employment or compensation agreements entered into, on or after the effective date of the rule (September 14, 2007).54 For 2008, very senior staff are those House employees who are paid at an annual rate of $126,975 for at least 60 days during their last twelve months of House employment.55
In addition, officers, very senior staff, and those Members subject to the notification requirement must recuse themselves from “any matter in which there is a conflict of interest or an appearance of a conflict” with the private entity with which they are negotiating or have an agreement for future employment or compensation, and they must notify the Standards Committee in writing of such recusal.56 Members who make such a recusal also must file their negotiation notification with the Clerk for public disclosure. The subject of Member recusal from voting is addressed in more detail later in this chapter. Forms to be used for these notification requirements are available on the Committee website (www.house.gov/ethics).
Other provisions of the rules relevant to future employment of Members and staff include the following. For Members and for staff persons required to file a termination Financial Disclosure Statement, any agreement they reach on future employment, whether oral or written, before termination of their service with the House must be disclosed on Schedule IX of that form. The gift rule provides that a Member, officer or employee may accept “[f]ood, refreshments, lodging, transportation, and other benefits . . . customarily provided by a prospective employer in connection with bona fide employment discussions” (House Rule 25, cl. 5(a)(3)(G)(ii). More information on this provision is provided in Chapter 2 of this volume. If an individual accepts travel exceeding $335 in value from a prospective employer in connection with employment negotiations, that travel must be disclosed on Schedule VII of the individual’s Financial Disclosure Statement.
1 114 Cong. Rec. 8807 (Apr. 3, 1968) (statement of Rep. Price).
3 Robert S. Getz, Congressional Ethics 3 (1967); see also Bayless Manning, Federal Conflict of Interest Laws 2-5 (1964); Black’s Law Dictionary 319 (8th ed. 2004).
4 Association of the Bar of the City of New York Special Comm. on Congressional Ethics, Congress and the Public Trust 39 (1970).
5 The statutory prohibition against representing others before federal agencies is discussed later in this chapter.
6 House Rule 23, cl. 5; House Rule 25, cl. 1(a)(2).
15 See 5 U.S.C. app. 4 § 505(3), as amended by the Legislative Branch Appropriations Act, 1992, § 314(b), 105 Stat. 447, 469 (1991).
16 House Rule 25, cl. 4(e). Section 170(c) defines contributions that are tax deductible. It includes contributions to the United States; the District of Columbia; any state or possession, or a political subdivision thereof if made for exclusively public purposes; religious, charitable, scientific, literary, or educational organizations; and organizations to foster amateur sports competition or for the prevention of cruelty to children or animals. These organizations may not be operated for profit, nor may they attempt to influence legislation or participate in political campaigns for public office. 26 U.S.C. § 170(c). Since an organization’s tax status is determined by the Internal Revenue Service, a Member or staff person who wishes to designate a particular organization to receive payments in lieu of honoraria should verify with the organization that the IRS has granted it tax deductible status under § 170(c).
18 See House Rule 25, cl. 5(a)(2)(A); see also Chapter 2 on gifts.
20 United States v. Sweig, 316 F. Supp. 1148, 1157 (S.D.N.Y. 1970).
21 May v. United States, 175 F.2d 994, 1005 (D.C. Cir.), cert. denied, 338 U.S. 830 (1949).
22 See U.S. Office of Government Ethics (“OGE”) Advisory Opinion 99 x 24 (Dec. 14, 1999); see also OGE Advisory Opinion 88 x 3 (Mar. 2, 1988) (same).
23 OGE Advisory Opinion 99 x 24, supra note 22; see also OGE Advisory Opinion 99 x 25 (Dec. 22, 1999) (permitting federal employee to accept compensation from firm that represented clients before federal entities where employee’s compensation was not derived from or contingent on those services).
24 United States v. Podell, 436 F. Supp. 1039, 1042 (S.D.N.Y. 1977), aff’d, 572 F.2d 31 (2d Cir. 1978); see also United States v. Eilberg, 507 F. Supp. 267, 271 (E.D. Pa. 1980) (stating that the “purpose of the remedy is . . . to provide a means of enforcing the loyalty of [government] agents”).
25 The criminal statute specifically exempts contracts entered into under the Agricultural Adjustment Act, the Federal Farm Loan Act, the Farm Credit Act of 1933, the Home Owners Loan Act of 1933, the Bankhead-Jones Farm Tenant Act, crop insurance agreements, and contracts that the Secretary of Agriculture enters into with farmers (18 U.S.C. § 433). In addition, contracts under the Federal Farm Mortgage Corporation Act are exempt from 41 U.S.C. § 22, as are contracts that the State Department makes in foreign countries (22 U.S.C. § 1472(a)(2)). The public contracting clause must appear, however, in contracts for the acquisition of land pursuant to flood control laws (33 U.S.C. § 702m).
26 See 22 Op. Off. Legal Counsel 33 (1988). But see 4 Op. Att’y Gen. 47 (1842) (permitting company in which Member was a partner to enter sales contract with U.S. Navy, where Member disclaimed any benefit from the contract).
27 See 39 Op. Att’y Gen. 165 (1938) (Member held 30% of corporation’s stock and was president of company); see also 33 Op. Att’y Gen. 44 (1921) (allowing corporations to accept loan from War Finance Corporation, secured by promissory note of company in which Member was a stockholder).
28 22 Op. Off. Legal Counsel 33, supra note 26.
29 Revised Statutes §§ 3739-3741, 2 Stat. 484, ch. 48 (Apr. 21, 1808).
30 48 C.F.R. §§ 3.601-3.603.
31 See, e.g., John V. Sullivan, Parliamentarian, Constitution, Jefferson’s Manual, and Rules of the House of Representatives, One Hundred Tenth Congress, H. Doc. 109-157, 109th Cong., 2d Sess. (2007), §§ 97-101 (hereinafter “House Rules and Manual”).
32 The cited amount is the $7,724 limit provided by the statute, as adjusted by the House Chief Administrative Officer in accordance with authority contained in 2 U.S.C. § 60a-2. As of the printing of this Manual, the 2008 maximum has not been set.
33 The maximum annual rates of pay for various House positions are set each year in the Speaker’s Pay Order.
34 See 18 U.S.C. § 602 and House Office Building Comm’n, Rules and Regulations Governing the House Office Buildings, House Garages and the Capitol Power Plant (Feb. 1999), at ¶ 4 (available from the Speaker’s Office).
35 See 18 U.S.C. § 602.
36 2 Deschler’s Precedents of the U.S. House of Representatives, ch. 7, § 13, at 125.
37 49 Comp. Gen. 819, 821 (1970).
38 As used here, the term “local government office” includes not only offices in a county, municipal, or town government, but also membership in a state legislative body.
39 5 U.S.C. § 7342. But see 37 U.S.C. § 908 (consenting to the civilian employment of retired military and military reserve members by foreign governments, when approved by the relevant Cabinet Secretaries).
40 Opinion of the Comptroller General B-180472 (May 9, 1974) (copy on file with the Standards Committee).
41 See, e.g., Memorandum of Walter Dellinger, Ass’t Att’y Gen., Office of Legal Counsel, Dep’t of Justice, to Gary J. Edles, General Counsel, Administrative Conference of the U.S. (Oct. 28, 1993) (Emoluments Clause prohibits government employees from accepting a law firm partnership distribution that may include some income received from foreign government clients) (available on the Office of Legal Counsel website, www.usdoj.gov/olc).
42 Comp. Gen. Op. B-180472, supra note 40.
43 See Foreign Agents Registration Act, 22 U.S.C. §§ 611-621.
44 Bipartisan Task Force Report, supra note 8, at 34, 135 Cong. Rec. H9262.
45 House Rule 27 was created by the Honest Leadership and Open Government Act of 2007 (“HLOGA”), Pub. L. 110-81, § 105, 121 Stat. 735, 741 (Sept. 14, 2007).
46 See, e.g., United States v. Schaltenbrand, 930 F.2d 1554, 1559 (11th Cir. 1991), cert. denied, 502 U.S. 1005 (1991) and United States v. Conlon, 628 F.2d 150, 155 (D.C. Cir. 1980), cert. denied, 454 U.S. 1149 (1982).
47 United States v. Hedges, 912 F.2d 1397, 1403 n.2 (11th Cir. 1990) (quoting jury instruction); see also Schaltenbrand, supra note 46, at 1559 n.2.
48 House Rule 23, cl. 3.
49 18 U.S.C. § 201(b)(2)(A).
50 Id. § 201(c)(1)(B).
51 The post-employment restrictions are discussed in detail in a pair of advisory memoranda – one for Members and officers and another for employees – issued annually by the Committee. Copies of the memoranda are available on the Standards Committee website.
52 Briefly, House Members may not contact any Member, officer, or employee of the House or Senate on official business for one year after leaving office, nor may they assist any foreign government in securing official action from any federal official during that year. House officers and employees may neither contact the individual’s former congressional office or committee members on official business for one year after leaving House employment, nor assist any foreign government in securing official action from any federal official during that year. Detailed guidance on the restrictions is contained in the memoranda referenced in note 51 above.
53 A former employee who joins a law firm should also be aware that a separate statutory provision, 18 U.S.C. § 203, has been interpreted to prohibit a former federal official who joins a firm from sharing in fees attributable to representational services in federally related matters where those services were provided by the firm while the individual was still employed by the government. OGE Advisory Opinion 99 x 24, supra n. 22.
54 A Member, Delegate, or Resident Commissioner is not subject to this requirement if his or her successor has been elected.
55 For employees of “other legislative offices,” the salary triggering the post-employment restrictions is level IV of the Executive Schedule. See 18 U.S.C. § 207(e)(7)(B). For 2008, that amount is $149,000. “[O]ther legislative offices” include the Architect of the Capitol, United States Botanic Garden, Government Accountability Office, Government Printing Office, Library of Congress, Office of Technology Assessment, Congressional Budget Office, and Capitol Police. It also includes any other House legislative branch office not covered by the other provisions, such as the Clerk, Parliamentarian, Office of Legal Counsel, and Chief Administrative Officer. See 18 U.S.C. § 207(e)(9)(G).
56 House Rule 27, cl. 4.