GOVERNMENT ETHICS AND DOING POSTAL BUSINESS IN THE 21st CENTURY

1. GOVERNMENT ETHICSANDDOING POSTAL BUSINESSIN THE 21st CENTURY 2000 National Executive Conference October 13, 2000 Wendy A. Hocking Chief Counsel, Ethics and Federal Requirements USPS Law Department

2. 21st CENTURY POSTAL SERVICE WHAT HAS CHANGED ABOUT THE BUSINESS OF THE POSTAL SERVICE IN THE LATE 20th AND BEGINNING OF THE 21st CENTURIES? It might be easier to list the ways in which we’ve stayed the same...

3. 21st CENTURY ETHICS WHAT’S CHANGED ABOUT GOVERNMENT ETHICS LAWS IN THE 21st CENTURY? Almost nothing, so far.

4. DOING BUSINESS So what do you really need to know about the ethics laws to participate in new and exciting postal business -- without personal risk -- in the 21st century?

5. DOING BUSINESS: TODAY’S “TAKE-AWAYS” • Appearances count • “Loose lips sink ships” -- and careers • Use a bright line to separate “personal” and “postal” • Beware of those seeking “favors” • Ask for help when you need it!

6. DOING BUSINESS TWO FRAMEWORKS: • Internal Compass (personal ethics) • Specific Rules (government ethics) Use your internal compass, supported by the rules.

7. DOING BUSINESS A) Conflicting financial interests, and Insider trading B) Seeking and Post-employment C) Impartiality, Misuse of position, and Endorsements D) Gifts from outside sources, and Gifts between employees

8. CONFLICTING FINANCIAL INTERESTS ALICE has stock in ABC Corp. She is the manager of a postal unit exploring possible alliances. ABC is a strong contender for an alliance. Conflict?

9. CONFLICTING FINANCIAL INTERESTS Questions: 1. How much stock? (<5K, no conflict) 2. What is Alice’s decision-making authority in this matter? 3. What if it was her husband’s stock? Or if ABC was her son’s employer? 4. Appearance issues? 5. Consider recusal, waiver, divestiture.

10. INSIDER TRADING ALEX is a PCES employee working on a huge postal contract with a publicly-traded company. The contract will be announced the first week in December. At Thanksgiving dinner, Alex mentions the deal. His in-laws buy stock in the company before the announcement. Conflict?

11. INSIDER TRADING Questions: 1. Was the information proprietary? 2. Did the in-laws have a need to know? 3. Did the in-laws make the purchase on the basis of the information Alex shared? 4. What if the purchase was made after the public announcement? 5. Does Alex know a good attorney?

12. SEEKING EMPLOYMENT BART is a PCES manager nearing retirement. A firm he’s worked with often over the years asks him to consider a job with the firm after he retires. He says he isn’t interested at the moment, but will keep it in mind. Any problems?

13. SEEKING EMPLOYMENT PROBABLY NO -- if neither Bart nor anyone who reports to him are currently conducting postal business with the firm. POSSIBLY YES -- if either Bart or those who report to him are working on matters involving the firm. Better to say “No,” unequivocally, until you are ready to start the discussion. Then, recusal may be necessary.

14. POST-EMPLOYMENT BARBARA, a former national program manager, left USPS to work for NEWBIZ .com. Two months into her new job (and three months after leaving USPS), Barb arranges a meeting with postal employees where she asks them to consider a partnership with NEWBIZ.com. Is this a problem?

15. POST-EMPLOYMENT Possibly. • What was Barb’s USPS salary when she left? • Was she working on anything involving NEWBIZ.com before she left? • How was the meeting arranged? Which USPS employees attended? Would the meeting have occurred if NEWBIZ.com’s representative was not a former postal employee?

16. IMPARTIALITY CARLOS, a District Manager, frequently socializes with high level employees of a large mailer in his District. He often attends sporting events, goes to dinner, and even vacations with some of them. Is this a problem?

17. IMPARTIALITY • What if the mailer has a problem with getting its mail accepted, and wants Carlos to get involved? • Could there be an appearance of impropriety? If a reasonable person who knows the facts could legitimately question his fairness, Carlos should not act on the matter.

18. MISUSE OF POSITION CELIA, a Law Department manager, is contacted by a friend whose wife has vast expertise in E-commerce matters. She’s interested in working for the USPS, and Celia knows there will soon be an opening. Celia recalls that this woman is brilliant and hard-working. May Celia call the E-folks toget this woman an interview right away?

19. MISUSE OF POSITION Celia MAY NOT share or act on information that is not publicly available. She MAY NOT give anyone special treatment; must honor the procedures in place for handling employment inquiries. She MAY provide information about where to send an unsolicited job inquiry, or where to find USPS job listings.

20. MISUSE OF POSITION Other potential “misuse” situations: Acquaintance asks for assistance obtaining postal contract Hometown businessperson just wants “a little help” with a postal problem Relative requests “inside scoop” about rumor of new post office

21. ENDORSEMENTS CRAIG, a Purchasing Manager, writes a letter to a postal vendor to express thanks for resolving a difficult situation. In the vendor’s next newspaper ad, Craig is quoted: “This vendor is ‘the all-time greatest’ -- USPS Purchasing Manager Craig Gracious.” Problem?

22. ENDORSEMENTS An endorsement of a product or service can only be provided if it is based on: 1) documentation that the product or service complied with postal requirements or standards, OR 2) official USPS recognition given to the product/service under a postal program that recognizes accomplishments in support of USPS mission

23. GIFTS FROM OUTSIDE SOURCES DENNIS, a technology manager, visits the HQ location of a large computer supplier. During Dennis’ visit, employees of the computer company: • pick him up at the airport and drive him to HQ; • take him out to lunch, and • at the end of the day, give him a t-shirt, hat, coffee mug, and lap-top, all emblazoned with the company logo.

24. GIFTS FROM OUTSIDE SOURCES Is there a problem with any of that? • Transportation • Meal • Merchandise Consider: “Intent to influence” Prohibited source $20 rule/$50 annual limit Appearances

25. GIFTS FROM OUTSIDE SOURCES Variation 1: DENNIS is invited by the computer company to attend -- free -- a conference it’s sponsoring. May he accept? Variation 2: DENNIS is invited by the company to a holiday party. May he attend?

26. WIDELY ATTENDED GATHERINGS This is an exception to the gifts rule. Need to know: • More than 75 people expected to attend? • Diversity of views represented? • Cost per person less than $1,000 ($250 if the invitation came from non-sponsor)? • Does Postal Service interest in employee’s attendance outweigh appearance of undue influence? You are encouraged to send invitations to ethics officials for written advice

27. GIFTS BETWEEN EMPLOYEES DARCY, an Area Finance Manager, receives a Montblanc pen from a member of her staff as a congratulatory gift for getting a VP award at the NEC. May she keep it? What if the pen was from her entire staff? What if the staff just threw her a party instead of getting her the pen?

28. GIFTS BETWEEN EMPLOYEES Generally -- don’t accept: • gifts from subordinates • gifts from anyone who makes less than you do • gifts worth more than $10

29. GIFTS BETWEEN EMPLOYEES OK: • Food/refreshments shared in the office • Hospitality at residence • Leave-sharing under the regulations For “Regularly occurring occasions,” $10 limit, including group gift For “Special infrequent occasions,” Items appropriate to the occasion

30. CONCLUSION • 20th Century rules still apply to 21st Century employees • Compliance with the ethics laws and regulations is your personal responsibility When in doubt, contact an ethics official!