5 CFR § 2635.503 - Covered payments from former employers.
(a) Recusal requirement. Except as provided in paragraph (c) of this section, an employee must recuse for two years from participating in any particular matter involving specific parties in which the employee's former employer is a party or represents a party if the employee received a covered payment from that person. The two-year period of recusal begins to run on the date that the covered payment is received.
Example 1 to paragraph (a): Following confirmation hearings and one month before their scheduled swearing in, a nominee to the position of Assistant Secretary of a department received a covered payment from their employer. For one year and 11 months after their swearing in, the Assistant Secretary may not participate in any particular matter to which the former employer is a party.
Example 2 paragraph (a): An employee received a covered payment from their former employer, a coal mine operator, prior to entering on duty with the Department of the Interior. For two years thereafter, the employee may not participate in a determination regarding the former employer's obligation to reclaim a particular mining site, because the former employer is a party to the matter. However, the employee may help to draft reclamation legislation affecting all coal mining operations because this legislation does not involve any parties.
Example 3 to paragraph (a): An architect accepts a position with the Army Corps of Engineers and resigns from a private architecture partnership. One month after beginning this new position, the architect receives a covered payment from the partnership. The architect may not participate in any particular matter involving specific parties in which the former partnership is a party until two years after receipt of the covered payment, which will be 25 months after beginning service with the Corps. Because the payment was not received before the architect became an executive branch employee, agency ethics officials must also review the payment to determine whether it constituted a supplementation of salary under 18 U.S.C. 209.
(b) Definitions. For purposes of this section, the following definitions apply:
(1) Covered payment means any item, including cash or an investment interest, with a value in excess of $10,000, which is paid:
(i) On the basis of a determination made after it became known to the former employer that the individual was being considered for or had accepted a Government position; and
(ii) Other than pursuant to a qualifying program.
(2)
(i) A qualifying program is:
(A) A compensation, partnership, or benefits program that is contained in bylaws, a contract, or other written form, and does not treat individuals entering Government service more favorably than other individuals; or
(B) A program that is not contained in written form, but is demonstrated by a history of similar payments made to others not entering Government service.
(ii) When a program is established in written form, any history of making similar payments to others not entering Government service that is contrary to an express provision of the written plan is not relevant to the evaluation of whether it is a qualifying program.
Example 1 to paragraph (b)(2): The vice president of a small corporation is nominated to be an ambassador. In recognition of service to the corporation, the board of directors votes to pay the departing vice president $50,000 upon confirmation in addition to the regular severance payment provided for by the corporate bylaws. The regular severance payment is not a covered payment because it was made pursuant to a qualifying program. The gratuitous payment of $50,000 is a covered payment, because the corporation had not made similar payments to other departing officers.
(3) Former employer includes any person which the employee served as an officer, director, trustee, general partner, agent, attorney, consultant, contractor, or employee. Payments from an officer, employee, or agent of a former employer will be considered to be payments from the former employer.
The definition of former employer includes former clients for whom an employee may have served as an agent, attorney, consultant, or contractor.
(c) Waiver of recusal. The recusal requirement of this section may be waived based on a finding that the amount of the payment was not so substantial as to cause a reasonable person to question the employee's ability to act impartially in a matter in which the former employer is or represents a party. The waiver must be in writing and may be given only by the head of the agency or, when the recipient of the payment is the head of the agency, by the President or the President's designee. Waiver authority may be delegated by the head of an agency to any person who has been delegated authority to issue individual waivers under 18 U.S.C. 208(b) for the employee who is the recipient of the covered payment.