January 18, 1994 DO-94-003 MEMORANDUM TO: Designated Agency Ethics Officials FROM: Stephen D. Potts Director SUBJECT: Ethics Training Regulation Update The Office of Government Ethics (OGE) will soon be publishing in the Federal Register interim rule amendments to the ethics training regulation, with request for comments. The interim rule, which will be published after OGE has consulted with the Office of Personnel Management, will amend subpart G of 5 C.F.R. part 2638, entitled "Executive Agency Ethics Training Programs" (training regulation). After seeking and receiving feedback from the ethics practitioner community, OGE has elected to make various amendments to subpart G in order to provide agencies with greater flexibility in administering their ethics training programs. These amendments will be published as an interim rule, with a retroactive effective date of January 1, 1994, to allow agencies to take advantage of the greater flexibility provided by the interim rule in conducting their 1994 ethics training programs. The interim rule will amend the training regulation as follows: (1) the materials required for the initial ethics orientation will be modified; (2) the categories of employees who must receive annual ethics training from their agencies will be clarified; (3) the nature and extent of the minimum course content requirements for annual ethics training, and their effect upon the diversity of the annual ethics training from year to year, will be clarified; and (4) the requirement that a qualified individual be physically present during and immediately following the annual ethics training will be deleted. Each of these amendments is described in more detail below. The interim regulation also will make certain minor corrections and deletions to the training regulation to remove outdated language. Materials Required for the Initial Ethics Orientation (5 C.F.R.2638.703) As an initial matter, the interim regulation will amend 2638.703(a) by deleting part I of Executive Order 12674 from the materials that must be provided as part of the initial ethics orientation. Requiring both part I of Executive Order 12674 and the Standards of Ethical Conduct to be included in the initial ethics orientation is redundant, as the fourteen principles of ethical conduct contained in part I of the Executive order are restated in subpart A of the Standards of Ethical Conduct. Since the publication of the training regulation, a variety of factors has led OGE to reevaluate the training regulation's requirement that agencies provide their employees with a copy of the actual text of the Standards as part of the initial ethics orientation. OGE has concluded that the current requirement does not provide agencies with the flexibility that they need to ensure that their employees achieve the best understanding of the rules that govern their conduct in an efficient and cost-effective manner. The interim regulation will therefore further amend
2638.703 to allow agencies to substitute materials that summarize part I of Executive Order 12674, as modified, and the Standards of Ethical Conduct for the actual text of the Standards. Under the interim regulation, agencies will be able to use OGE publications, such as the pamphlets "Do It Right" and "Take the High Road," or may develop their own materials designed to the specific needs of their employees and ethics training program. In order to ensure that employees continue to have access to the actual text of these materials, an agency using substitute materials will be required to ensure that copies of the complete text of part 2635 are retained and readily accessible in the employees' immediate office. Employees Who Must be Provided Annual Agency Ethics Training (5 C.F.R. 2638.704(b)) The training regulation, at 5 C.F.R. 2638.704(b), sets forth the categories of employees to whom agencies must provide annual ethics training. This section is taken virtually word for word from section 301(c) of Executive Order 12674, as modified. Some agencies have been interpreting part of this provision in an overly broad fashion, and thus have increased the number of employees to whom they are providing annual ethics training beyond the number strictly required by the training regulation. The category that has been subject to misinterpretation is that of procurement offi- cials, found at § 2638.704(b)(6). This confusion seems to arise, in part, from the distinction between acting as a procurement official and an employee's certification that he or she is aware of the procurement integrity restrictions. Section 2638.704(b)(6) of the training regulation states that procurement officials "within the meaning of 41 U.S.C. 423(p)(3)" are covered by the annual training requirement. Both the procurement integrity statute and the implementing regulations, at 48 C.F.R. 3.104-4(h), make it clear that a civilian or military official or employee does not become a "procurement official" until that individual participates personally and substantially in one or more of the activities set forth in the definition. Before an official or employee may serve as a procurement official, the procurement integrity statute requires him or her to certify that he or she is familiar with various procurement integrity restric- tions, and that he or she will report a violation of these restric- tions to the contracting officer. 41 U.S.C. 423(l)(2); 48 C.F.R. 3.104-12(a)(2). Because of some uncertainty over the breadth of the term "procurement official," and also for administrative rea- sons, the policy of some agencies has been to have all employees who have even a remote chance of becoming involved in a procurement complete the procurement integrity certification for procurement officials. While the reasons for having officials and employees complete the certifications are generally sound, it has caused some confusion for agencies as they plan their annual ethics training. Some agencies have incorrectly assumed that they are required to provide annual ethics training for all officials and employees who have completed the procurement integrity certification. As stated above, both section 301 of Executive Order 12674 and the training regulation cross reference the definition of "procurement official" contained in the procurement integrity statute. It is important to note that mere completion of the procurement integrity certification for procurement officials, without more, does not constitute personal and substantial involvement in a procurement and therefore is not sufficient to make an official or employee a "procurement official" within the meaning of the statute. An agency is thus not required to provide annual ethics training to an employee just because he or she has completed the procurement integrity certification for procurement officials. While an agency may for policy or administrative reasons choose to provide annual ethics training for a broader category of officials or employees, it is not obliged by 2638.704(b)(6) to provide annual ethics training to a person who has completed a procurement integrity certification unless the individual actually serves as a procurement official. The interim regulation will also add language to section 2638.704(b)(4) to clarify that any employees who are exempted from confidential financial disclosure reporting pursuant to OGE- approved alternative procedures in accordance with 5 C.F.R. 2634.905(c) must also receive annual ethics training from their agencies. Course Content Requirements for Annual Agency Ethics Training (5 C.F.R. 2638.704(c)) Another change made by the interim regulation concerns the course content requirements for annual agency ethics training, contained in the training regulation at section 2638.704(c). Some agencies have read the training regulation as requiring all executive branch agencies to provide repetitive training year after year on the same material. As OGE indicated in the preamble to the training regulation when it was published, this view misunderstands the nature of the requirement. Section 2638.704(c) states that ". . . the emphasis and course content of annual agency ethics training courses may change from year to year . . . ." The section then goes on to state the minimum requirements, that of a review of employees' responsibilities under part I of Executive Order 12674, as amended, and the Standards of Ethical Conduct (and any agency supplemental regulation) as well as a review of employees' responsibility under the conflict of interest statutes contained in 18 U.S.C. chapter 11. The preamble to the April 1992 final rule stated that, after the first session of annual training, this requirement could be met with a brief overview of the basic principles. Such an overview, given to employees who are familiar with their responsibilities under the statute and the regulations, need serve only as a reminder of the basic principles, and could be accomplished in a very short period of time. The content of the rest of the training is entirely at agency discretion. The structure of the annual ethics training is intended to allow agencies to vary their approach from year to year to keep the program interesting and also to best meet the needs of their employees. OGE encourages innovation by agencies in providing training to their employees. Some agencies have been very active in following up on the flexibility provided to them for annual training. The Department of Justice, for example, is developing an interactive ethics computer game for use in training their employees. Several agencies, such as the Department of Defense and the U.S. Forest Service, are developing videotapes to supplement the OGE ethics training videotapes or to target the information provided to their employees. OGE has consistently maintained that the minimum course content requirement contained in the regulation is intended to be a starting point from which agencies design and conduct their training, not a rigid requirement. However, because of continued misunderstanding regarding the nature of this requirement, the interim regulation will amend the language contained in § 2638.704(c) to state that a reminder of employees' responsibilities under the statute and the regulations will suffice to meet this requirement. Availability of a Qualified Individual (5 C.F.R. 2638.704(d)(1)) The interim rule amendment will also delete the general requirement, contained in 2638.704(d)(1), that annual training be presented with a qualified individual physically present during and immediately following the presentation. While 2638.704(d)(1) uses the term "available," both the text of the regulation and the preamble at the time of publication made it clear that OGE expected the qualified individual to be present at the training. 57 Fed. Reg. 11886, 11889 (April 7, 1992). The reason for this requirement, as explained in the preamble to the final rule, was to provide the best means for addressing employee questions and concerns raised by the training. Some agencies, particularly those whose duty sites are widely scattered, have voiced concern over their ability to meet this requirement. The training regulation provides an exception, at 2638.704(d)(2)(i), that does allow agencies to train covered employees without a qualified individual present under limited circumstances. This exception, however, is narrow in scope. Other limited exceptions are made for training provided to special Government employees and reserve officers. Agency concern with this requirement, spurred on by legitimate concerns over the best use of limited agency resources, has caused OGE to move away from a strict presence requirement for the annual ethics training over the past year, so long as the employee retains some form of access to a qualified individual during and immediate- ly following the training. OGE has come to conclude that, while in person training is often the most effective means of providing training, providing the "best" means of training may not be a realistic standard for all agencies in these times of fiscal restraints. The question therefore becomes one of setting a standard that agencies are able to meet while simultaneously meeting the goals of the ethics training program. The interim regulation will meet this standard by deleting the requirement that a qualified individual be physically present dur- ing and following annual ethics training. The interim regulation will continue the requirement that the annual training generally be provided verbally, either in person or by recorded means. Written materials, standing alone, generally will not meet this require- ment. This is necessary to comply with section 301(c) of Executive Order 12674, as modified by Executive Order 12731, which requires agencies to provide covered employees with an annual ethics "brief- ing." For the purposes of the interim regulation, "briefing" will not require actual physical presence. Agencies will thus be able to take advantage of technology in meeting this standard. This could include, but is not limited to, use of videoconferencing, telephone conferencing, audio or videocassettes, or computer-based training. Agencies will be required to have "qualified individu- als" as defined in subpart G develop any materials or lessons used in the training. Agencies will also be required to remind employees receiving annual ethics training of the names and phone numbers of ethics officials at their agency. This will provide employees with a point of contact should they need to seek clarification of issues raised in the course of the training or in their day-to-day work. Agencies should note that they will not be required to submit modified training plans for calendar year 1994 to OGE to accommo- date these amendments.