The proposal is included in a new OGE report commissioned by Congress, which also includes a series of other recommendations for modifying conflict of interest laws related to federal employment.
The 1978 Ethics in Government Act imposed the cooling-off period, which prohibits senior federal employees from communicating with their former agencies on behalf of another company or organization about matters under their general area of official responsibility while in government. (Federal employees at all levels permanently are barred from seeking to influence their former agencies about matters on which they personally worked.) The problem with the law is that the definition of what constitutes a senior employee has changed several times over the years. First, OGE itself had the authority to designate which executives were covered. Then, in 1990, Congress created a new definition: any executive at or above Level I of the Executive Schedule, which covers high-ranking political appointees. Under that standard, executives at what were then the top two levels of the SES, levels 5 and 6, were included. Then, starting in the mid-1990s, salary compression at the highest levels of the federal pay scale threatened to include SES level 4 employees under the restrictions. So Congress again changed the definition, this time to executives at SES level 5 and above. As a result, the OGE report notes, agencies began reporting that some executives at level 4 were turning down promotions to avoid moving up to a salary category that would cause them to be subject to the restrictions.
In 2003, when SES members were shifted to a pay-for-performance system that eliminated existing pay levels, Congress imposed a new standard: any employee whose pay was equal to 86.5 percent of Executive Level II pay.
According to OGE, under this standard, most SES members now are covered by the cooling-off restrictions. The OGE report says extending the provisions to all of them "has obvious merits." Such an approach "would provide considerable clarity and uniformity in the treatment of SES employees, and it would eliminate the potential for gamesmanship within the pay system. Moreover, [this] approach would eliminate pay as a surrogate marker for level of influence, which is increasingly hard to justify in light of the new pay-for-performance principles governing the SES."
Carol Bonosaro, president of the Senior Executives Association, called OGE's proposal "stunning."
"Instead of correcting what was really a legislative error, they now propose to compound it," Bonosaro said. She said the proposed new restrictions, if implemented, would serve to lessen the opportunities federal executives would have in the private sector after they leave government. "It gives them one more ethical restriction to worry about," she said. OGE rejected three other proposed suggestions for modifying the cooling-off period:
- Returning to a system in which OGE itself would define which positions would be covered, or agencies would be allowed to decide which jobs to include.
- Simply raising the existing salary threshold. (The problem with this, OGE said, "would be the potential that employees would engage in some degree of 'gamesmanship' by declining pay increases in order to avoid triggering the threshold, while still enjoying a relatively high salary.")
- Limiting the restrictions to noncareer members of the SES. This runs the risk of impugning the motives of politically appointed executives, OGE said, and fails to recognize that "high-level career employees can and do acquire significant influence in their agencies."
National Journal correspondent Brian Friel contributed to this report.