hours of absence from work that will be required;

(7) Method or basis of compensation (e.g. whether fee basis, per diem, per annum, or other).

(d) Office-holding in professional societies. The request should be submitted in memorandum form and should show all information pertinent to the activity and the reasons why the employee considers that such activity would not constitute a conflict of interest.

§ 73.735-903 Acting on employee requests. (a) Requests must be thoroughly reviewed to insure that the outside activity for which approval is being sought is permissible under applicable statutes and regulations. The review should be conducted by an individual conversant with the statutes and regulations. As required, advice and guidance should be obtained from the Department Counsellor or Deputy Counsellors on employee conduct (§ 73.735104).

(b) The review should appraise the request in terms of:

(1) Compliance with statutes, regulations;

(2) Conflicts or apparent conflicts of interest; and

(3) Potential problems arising from the employee's participation in the outside activity which could result in embarrassment to the Department or the employee.

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(c) The approving official must satisfy himself on all these points before granting approval. Any conflict or apparent conflict of interest questions must be resolved before action taken. The Department Counsellor or Deputy Counsellors on employee conduct will furnish advice and assistance as needed by the approving official.

(d) The approving official should indicate his action in writing in response to the employee's written request. The record on each request should be complete and contain the written request and written notification of action taken on the request.

(e) Requests for approval to perform professional or consultative services involving institutions or government units which have recently negotiated, or may in the near future seek con

tracts or grants from the Federal government will be granted only after any conflict or apparent conflict of interest matters have been identified and resolved.

§ 73.735-904 Annual reporting.

On September 5 each year, the approving officer shall require a report from each person for whom outside work has been approved during the past year. The report shall follow the format prescribed in Appendix G to this part and shall show:

(a) For the 12 months just past (ending August 31). (1) Whether the anticipated work was actually performed for the person or organization named in the request for approval;

(2) Actual amount of time spent on the activity.

(b) For the forthcoming 12 months (ending August 31). (1) Whether it is anticipated that the outside work will continue;

(2) Whether any change is anticipated with respect to information supplied in accordance with the original request on which approval was based.

§ 73.735-905 Maintenance of records.

All requests for approval of outside work or of participation in a matter in which an employee has a financial interest (or copies of such requests), a copy of the notification of approval or disapproval, and the annual report shall be filed at a level where they are readily available to the Secretary. This level shall be that of the approving official or higher. These records I will be treated as Personnel-Confidential and made available only to persons specifically authorized by the Secretary.

Subpart J-Statements of Employment and Financial Interest

§ 73.735-1001 General.

(a) The requirements of this subpart are in addition to and not in substitution for, the requirements of Subpart I of this part concerning administrative approval for certain activities. Also, the requirements of this subpart are in addition to and not in substitution

for, or in derogation of, any similar requirement otherwise imposed by law, order, or regulation. The submission of a statement or supplementary statement by an employee does not permit him or any other person to participate in a matter in which his or the other person's participation is prohibited by law, order, or regulation.

§ 73.735-1002 Applicability.

(a) The following employees shall submit statements of employment and financial interest in accordance with the provisions of this subpart:

(1) Employees paid at a level of the Executive Schedule in subchapter II of Chapter 53 of title 5, United States Code.

(2) Employees in positions classified at GS-13 or above (or comparable pay level) specifically identified by the Secretary which have basic duties and responsibilities which require the incumbent to exercise judgment in making a Government decision or in taking Government action in regard to contracting or procurement, administering or monitoring grants or subsidies, regulating or auditing private or other non-Federal enterprise, or other activities where the decision or action has an economic impact on the interest of any non-Federal enterprise;

(3) Any other positions classified at GS-13 or above (or comparable pay level) specifically identified as positions determined by the Secretary as requiring the incumbent thereof to report employment and financial interests in order to avoid involvement in a possible conflicts-of-interest situation and to carry out the requirements and intent of standards of ethical conduct.

(4) Any other positions classified below GS-13 (or comparable pay level) specifically identified by the Secretary (and justified to and approved by the Civil Service) as requiring the incumbent thereof to report employment and financial interests in order to protect the integrity of the Government and avoid employee involvement in a possible conflicts-of-interest situation.

(b) As new positions are established or duties of other positions change to bring them within the criteria stated in paragraph (a) (2), (3), or (4) of this

section they shall be identified and reported to the appropriate office for inclusion. Exclusion of such positions from this requirement may be made when the Secretary determines that the duties of a position are at such a level of responsibility that the submission of a statement of employment and financial interests by the incumbent is not necessary because of the degree of supervision and review over the incumbent and the remote and inconsequential effect on the integrity of the Government. Exclusions under this provision must be documented in writing and retained at the level of the determining official.

(c) Employees shall have the opportunity for review through the Department's grievance procedure of a complaint that his position has been improperly included under this subpart as one requiring the submission of a statement of employment and financial interests.

§ 73.735-1003 Content of statements.

(a) The statements of employment and financial interests shall follow the format prescribed in Appendix D to this part.

(b) The interest of a spouse, minor child, or other blood relative who is a resident of the employee's household is considered to be an interest of the employee, and shall be reported on the statement.

(c) If any information required to be included on the statement of employment and financial interests or supplementary statement, including holdings placed in trust, is not known to the employee but is known to another person, the employee shall request that other person to submit information in his behalf.

(d) An employee is not required to submit on the statement any information relative to his connection with, or interest in, a professional society or a charitable, religious, social, fraternal, recreational, public service, civic, or political organization or a similar organization not conducted as a business enterprise. Educational and other institutions doing research and development or related work involving grants of money from or contracts with the

Government are deemed "business enterprises" and are required to be included.

§ 73.735-1004 Submission and review of statements.

(a) Officials responsible for reviewing employment and financial interests shall be the same as by those who are designated to consider requests for administrative approval as discussed in Subpart I of this part.

(b) Reviewing officials shall request that statements of employment and financial interests be submitted by employees covered by § 73.735-1002, in accordance with the following schedule:

(1) September 30, 1967, if employed before September 1, 1967; or

(2) Thirty days after he becomes subject to the reporting requirements by occupying a position covered by § 73.735-1102, if he occupies the position after August 1, 1967.

(3) Changes in, or additions to, the information contained in the statement shall be reported in a supplementary statement as of June 30, of each year. If no changes or additions occur, a negative report is required. Notwithstanding the filing of the annual report required by this section, each employee shall at all times avoid acquiring a financial interest that could result, or taking an action that would result, in a violation of the conflicts-of-interest, provisions of section 208 of title 18, United States Code, or Subpart E of this part.

(c) Statements shall be submitted in one copy only.

(d) The reviewing officer shall review statements to determine whether conflicts of interest or apparent conflicts might arise from the activities reported thereon.

(e) When no conflict of interest or apparent conflict is disclosed by the review of the statements, no further action is necessary by the reviewing officer and the statements shall be filed in accordance with § 73.735-1005.

(f) When a question on conflict of interest or apparent conflict arises, the reviewing officer shall work with the employee to resolve the matter.

He shall offer the employee or special Government employee an opportunity to explain the conflict or apparent

conflict. If the question cannot be resolved the matter shall be reported to the Secretary through the appropriate counselor or deputy counselor for further consideration and action.

§ 73.735-1005 Maintenance of records.

Statements on which questions of conflict of interest or apparent conflict have arisen shall be annotated to show the action taken. All statements and supplementary statements of employment and financial interests shall be filed at a level where they are readily available to the Secretary. This level shall be that of the approving official or higher. These records shall be treated as Personnel-Confidential and made available only as specifically authorized by the Secretary or the Office of Personnel Management for good cause shown. Each employee who is responsible for reviewing or retaining statements of employment and financial interests shall maintain each such statement in confidence and shall not allow access to, or information to be disclosed from a statement except to carry out the purpose of this part.

Subpart K-Disciplinary and Remedial Action

§ 73.735-1101 Disciplinary action.

(a) Violation of the regulations contained in this part may be cause for disciplinary action which may be in addition to any penalty prescribed by law.

(b) The type of disciplinary action to be taken shall be determined in relation to the specific violation. No standard table of penalties has been established for application in the Department. Those responsible for recommending and for taking disciplinary action must apply judgment to each case, taking into account the general objectives of meeting any requirements of law, deterring similar offenses by the employee and other employees and maintaining high standards of employee conduct and public confidence. Some types of disciplinary actions to be considered are: (1) Oral admonishment. (2) Written reprimand. (3) Reassignment.

(4) Demotion. (5) Suspension. (6) Separation.

(c) Demotion, suspension, and separation are adverse actions and when taken must follow law, Civil Service Regulations and Department procedures.

873.735-1102 Remedial action.

(a) Where the statements of employment and financial interest of employees or special Government employees, filed under the provisions of Subparts J and L of this part, show a conflict of interest with their official responsibilities, consideration should be given by the agency head or his designee and the employee's supervisor to reconciling the conflict through remedial actions. The following are examples of such actions which may be appropriate:

(1) Divestment by the employee or special Government employee of his conflicting interest.

(2) Disqualification for a particular assignment.

(3) Changes in assigned duties.

(b) Remedial action shall be effected in accordance with any applicable laws, Executive orders, and regulations.

Subpart L-Special Provisions Relating to Special Government Employees and Consultants

873.735-1201 Applicability.

The requirements of this subpart apply to the group of employees designated by law (18 U.S.C. 202) as "special Government employees." The term includes employees who are retained, designated, appointed or employed to serve, with or without compensation, for not more than 130 days during any period of 365 consecutive days, either on a full-time or intermittent basis. This subpart applies to all consultants (defined in § 73.735-1205) even though the consultant who works more than 130 days in 365 is subject also to the regulations in this Part 73 as a regular employee. Sections 73.7351205 and 73.735-1206 apply only to those special Government employees indicated. Intermittent employees are subject to the political activity restric

tions of subchapter III of Chapter 73 of title 5, U.S.C. (the former Hatch Act) and Rule IV when in active duty status only and for the entire 24 hours of any day of actual employment. 873.735-1202 Ethical standards of conduct.

(a) A special Government employee must conduct himself according to ethical behavior of the highest order. In particular,

(1) He must refrain from any use of his office which is, or appears to be, motivated by a private gain for himself or other persons, particularly those with whom he has family, business, or financial ties. The fact that the desired gain, if it materializes, will not take place at the expense of the Government makes his actions no less improper.

(2) He must conduct himself in a manner devoid of any suggestion that he is exploiting his Government employment for private advantage. He must not, on the basis of any inside information, enter into any speculation or recommend speculation to members of his family or business associates, in commodities, land, or the securities of any private company. He must obey this injunction even though his duties have no connection whatever with the Government programs or activities which may affect the value of such commodities, land, or securities. He should be careful in his personal financial activities to avoid any appearance of acting on the basis of information obtained in the course of his Government work.

(3) He must not use information not generally available to those outside the Government for the special benefit of a business or other entity by which he is employed or retained or in which he has a financial interest. Information not available to private industry should remain confidential in his hands and not divulged to his private employer or client. In cases of doubt whether information is generally available to the public, the special Government employee should confer with the person who assigns work to him, with the office having functional responsibility for a specific type of in

formation, or, as appropriate, with the officials designated in § 73.735-104 to give interpretive and advisory service.

(4) He must, where requested by a private enterprise to act for it in a consultant or advisory capacity and the request appears motivated by the desire for inside information, make a choice between acceptance of the tendered private employment and continuation of his Government consultancy. He may not engage in both.

(5) He must not use his position in any way to coerce, or give the appearance of coercing, anyone to provide a financial benefit to him or another person, particularly one with whom he has family, business, or financial ties.

(6) He must not receive or solicit anything of value as a gift, gratuity, loan, entertainment, or favor for himself or another person, particularly one with whom he has family, business, or financial ties if the acceptance would result in loss of complete independence or impartiality in serving the Government.

(7) He may teach, lecture, publish, or write in a manner not inconsistent with the regulations in §§ 73.735-403 to 73.735-405 for such activities for regular employees.

(b) A special Government employee who has questions about conflicts of interest or the application of the regulations in this part to him or his assigned work should make inquiry of the person who assigns his work. That person will direct him to the counselor or a deputy counselor for interpretative and advisory services as provided in § 73.735-104.

§ 73.735-1203 Statement of financial interests required.

(a) Each special Government employee described in §§ 73.735-1205 and 73.735-1206 must submit a statement which reports:

(1) All other employment; and

(2) The financial interests which relate either directly or indirectly to his duties and responsibilities.

(b) He shall submit such statement not later than the time of employment, and shall keep it current throughout the period of employment by the submission of supplementary statements.

(c) The format prescribed in Appendix E to this part shall be used for recording the information required by paragraph (a) of this section.

(d) Officials responsible for reviewing statements of employment and financial interests shall be the same as those designated to give administrative approval to outside work or regular employees unless the Secretary designates another official to be responsible for such review. When no conflict of interest is disclosed by the review of the statements, no further action is necessary by the reviewing officer and the statement shall be filed in accordance with paragraph (e) of this section. When a question of conflict of interest arises, the reviewing officer shall work with the consultant or special Government employee to resolve the matter or shall refer the question to the appropriate counselor or a deputy counselor for further consideration and advisement.

(e) A confidential file of completed statements of employment and financial interests shall be maintained in the personnel office that maintains the official personnel folder (but not in the personnel folder), together with correspondence, memorandum, etc., relating specifically thereto. These forms and related materials are not forwarded to the Federal Records Center upon separation of the employee but are disposed of in accordance with the appropriate disposal schedule.

§ 73.735-1204 Special Government employees who must submit statement of financial interests.

(a) The statements of financial interests described in § 73.735-1203 must be submitted by the following special Government employees:

(1) Consultants, experts, or advisers (hereafter referred to in this subpart as consultants) described in § 73.7351205;

(2) Such special Government employees (other than consultants) as the heads of operating agencies so determine (in accordance with § 73.7351206).

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