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February 4, 2013

NOTES -- DEC/EC Meeting
Monday, February 4, 2013

Introductions:

  • NEO Staff
  • IC Staff

Items for Discussion/Presentations:

1. Effect of Salary on 278 Filer Status and 207(c) Senior Employee Status

278 Filing Status

  • 278 filing status is determined by the position the employee holds, not by the amount of his/her salary. 
  • An employee is a 278 filer if he or she serves in one of the following positions: 
    • Administrative Law Judge (not applicable to the NIH);
    • Corps Officer ranked 0-7 or above; or
    • SES.
  • Also an employee is a 278 filer if he or she receives his pay through a system which has a basic rate of pay equal to 120% of the rate of basic pay for a GS-15.  At the NIH, SL and ST are such pay systems.  Note:  T42 does not have a basic rate of pay equal to 120% of the rate of basic pay for a GS 15, so unless a T42 employee’s position has been equally classified as a 278 filing position (see below), a T42 employee does not file a 278 report regardless of his or her salary.
  • Last, an employee is a 278 filer if he or she is in a position determined to be of equal classification to an SES position.  Note:  a position is not equally classified for purposes of 278 filing status until we get such a determination from OGE.  So, even if an employee is assigned to a newly established position that fits within a category of positions previously established as 278 filing positions, e.g., an IC Director or a Lab Chief, the employee does not become a 278 filer until his or her position has been equally classified by OGE.  Similarly, if the IC wants to a de-classify a position, the employee must continue to file the 278 report (and comply with the STOCK Act) until OGE agrees to de-classify the position.

207(c) Senior Employee Status

  • An employee is subject to the restrictions in 207(c) if his or her salary is at or above $155,441, excluding locality pay or Physician Comparability Allowance (PCA) or Physician Specialty Pay (T38).  Note:  T42 employees do not get locality pay, or PCA or T38.  (PCA and T38 are paid under a T5 appointment.)  So, there is nothing to subtract from a T42 employee’s pay in order to determine the applicability of the 207(c) restrictions.  GS employees do get locality pay.  Thus, no GS employee would be subject to 207(c). 

2. Accepting 348 Travel From An Outside Activity Employer

A request to amend the below policy statement (highlighted in yellow) was received.  The statement is found in the NIH Policy Manual, 2400-04 Managing Conflicts of Interests and the Introduction of Bias (https://policymanual.nih.gov/2400-04).

F. NIH Policy

In addition to the policies stated in the descriptions of the mechanisms to resolve conflicts of interest above, the following specific policies will prevent conflicts for the employee and for the NIH.
. . . .

2. Sponsored Travel: ICs should not accept sponsored travel for employees where they have certain official relationships, e.g., the offering organization is in the grant portfolio of an extramural Health Scientist Administrator (HSA), supplies a drug for a clinical trial the employee conducts, or is a Cooperative Research and Development Agreement (CRADA) or Materials Transfer Agreement (MTA)-CRADA partner with the employee (unless the travel was explicitly negotiated as part of the CRADA contract).  In addition, sponsored travel may not be accepted by the NIH if the employee is traveling to explore potential collaborative activities with the organization, or if the employee has conducted an approved outside activity with the organization less than 12 months ago.  Although official travel is governed by the regulations from the General Services Administration and sponsored travel is a gift to the NIH not to the individual, it is important to consider the potential conflicts of interest for the employee and the NIH associated with accepting sponsored travel from an outside organization.

As we discussed, the situation that most commonly triggers this prohibition involves an employee who serves as an officer of a professional society and is also invited to present her NIH research at the society’s annual scientific meeting, typically a week-long meeting, involving many presenters.  As you know, generally, the rules prohibit an employee who has an outside relationship with an organization from also having an official duty activity with the same organization.  However, that employee could be authorized, pursuant to 5 CFR 2635.502(d), to engage in both of these activities, and IC ethics officials typically do.  The factors that are considered and support the granting of such an authorization may be:  1) the nature of the relationship involved (officer of a professional society as an outside activity which is typically encouraged by NIH and not controversial); 2) effect the resolution of the matter (scientific talk) would have on the financial interest(s) of the person (scientific society) involved (should be no effect because one talk amongst a week-long agenda of presentation is not determinative of the success of the meeting); 3) sensitivity of the matter (the scientific talk) (not sensitive and routine); and 4) the difficulty of reassigning the matter to another employee (difficult because of the employee’s unique expertise to discuss her current research).

Furthermore, OFM confirmed that sponsored travel could be accepted by the IC under the applicable travel regulations.  The travel rules are not the reason for this policy statement.  I presented the following information and analysis to OFM, and OFM concurred:

As you may know, these annual meetings may be very large.  30-40 (often more) experts are asked to present information.  Typically, all the presenters are offered travel, lodging and waived registration (so they can attend the entire scientific meeting) and the IC would almost always accept such a gift, but for the employee’s outside activity with the organization.  In doing so, factors that would likely be considered by the IC are:  1) the offered gift to the agency is identical to the gift offered to all the other speakers; 2) it’s the same gift that was offered in previous years by the society (before the employee became an officer of the organization); and 3) it’s an appropriate situation for 348 travel – not an event “required to carry out [the NIH’s] statutory . . . functions,” but rather “an event where the employee will participate as a speaker . . . focusing on his/her official duties . . . .” 

The other issue that may arise under this situation is that, pursuant to HHS travel policy, domestic sponsored travel cannot be accepted in connection with annual leave.  It has been pointed out that the society will often hold a board meeting during the annual scientific meeting.  So, while the NIH employee will attend all the scientific sessions in her NIH intramural capacity (as part of her official duties), she may need to put on her board member hat and attend the board meeting at some time during the same week.  This usually does not pose a problem as such board meetings are typically held before or after the scientific meeting.  Since the outside activity (attending the board meeting) is performed during non-duty hours, there are no problems. 

Occasionally, these board meetings do create a problem if the board meeting is held during the scientific meeting, for example, from 2-4pm, or the day before the start of the scientific meeting.  In those rare cases, we inform the employee that she must take annual leave when engaging in an outside activity.  So, assuming that is done, attending both the scientific meeting and the board meeting during the same trip is permissible under the ethics rules and the government travel rules.  However, HHS travel policy says that 348 travel cannot be accepted if on the same trip the employee uses annual leave.  OFM has contacted HHS to see if such an exception to the travel policy may be granted.   

3. Using a 450 report To Pre-Clear a Current Employee To Act in a 278 Filing Position

  • Ask the employee to confirm that the 450 is current; if not, ask the employee to update the report. 
  • Confirm whether the employee is expected to be in the position for more than 60 days. 

If yes, a new entrant 278 report is due within 30 days of the appointment date to the Acting position.  Insert this paragraph into the EA/EU:

You provided an update to your Incumbent Confidential Financial Disclosure Report (OGE-450).  Within 30 days of the date you assume the Acting [add name of the position] position, you will be required to file a New Entrant Public Financial Disclosure Report (Form OGE-278).  As a Form OGE-278 filer, provisions of the Stop Trading On Congressional Knowledge (STOCK) Act will be applicable to you.  Among other things, the Act requires 278 filers to notify the NIH if:  1) they enter into post-government employment negotiations or an agreement for future employment or compensation; and/or 2) they or their spouse or dependent child(ren) make certain transactions.  Once you become a 278 filer, you will be required to comply with these requirements.  Furthermore, the STOCK Act requires the NIH to submit for posting on a central federal government website its employees’ OGE-278 reports.  This requirement is currently under review.  If the posting provision is upheld, your report will be posted.  Please see the NIH Ethics Office website for more information on the STOCK Act:  StockAct

If no, contact the employee 45 days after his/her appointment date to confirm that he/she will not serve more than 60 days in the Acting position.  If the employee does serve for more than 60 days, a new entrant 278 report is due within 15 days of the 60th day following the appointment date to the Acting position.  Insert this paragraph into the EA/EU:

You provided an update to your Incumbent Confidential Financial Disclosure Report (OGE-450); therefore, no further action is needed with respect to your financial disclosure report.  However, if you perform the duties of Acting [add name of position] for more than 60 days, you will be required to file a New Entrant Public Financial Disclosure Report (Form OGE-278), within 15 days of the 60th day following the appointment date to the Acting position.  As a Form OGE-278 filer, provisions of the Stop Trading On Congressional Knowledge (STOCK) Act will be applicable to you.  Among other things, the Act requires 278 filers to notify the NIH if:  1) they enter into post-government employment negotiations or an agreement for future employment or compensation; and/or 2) they or their spouse or dependent child(ren) make certain transactions.  If you become a 278 filer, you will be required to comply with these requirements.  Furthermore, the STOCK Act requires the NIH to submit for posting on a central federal government website its employees’ OGE-278 reports.  This requirement is currently under review.  If the posting provision is upheld, your report will be posted.  Please see the NIH Ethics Office website for more information on the STOCK Act:  StockAct

4. Recusals Obligation and Seeking Employment:  tabled to next meeting

5. Topics for Guest Speakers

  • Please send me suggestions for guest speakers to address our meeting.  For example:
    • Grants Management
    • Tech Transfer
    • Intramural Investigator.

    Posted 3/1/13