This describes government-wide rules. Every agency layers its own supplemental ethics regulation on top, and those supplements are where most of the actual prohibitions live. Nothing here substitutes for a written answer from your agency ethics official about your proposed activity. Where criminal statutes are in play, see retaining counsel.
I What is actually allowed
Start with the thing people get wrong in both directions. There is no blanket prohibition on federal employees holding outside jobs. Teachers teach, nurses take shifts, engineers consult, people run small businesses on weekends. That is normal and lawful.
The governing rule at 5 CFR part 2635 subpart H is narrower than a ban and stricter than a formality: you may not engage in outside employment or any other outside activity that conflicts with your official duties.
Everything else in this guide is the machinery for determining what “conflicts” means and who decides.
II What counts as outside employment
The definition is deliberately wide. Outside employment means any non-federal business relationship or activity involving personal services, whether paid or unpaid.
| Activity | Counts? | Why it matters |
|---|---|---|
| Part-time paid job | Yes | The obvious case |
| Self-employment or a side business | Yes | You are the entity |
| Unpaid board seat at a nonprofit | Yes | Officer roles impute the organisation's interests to you |
| Volunteer work involving personal services | Yes | Payment is not the test |
| Consulting, even one engagement | Yes | A relationship is a relationship |
| Passive investment with no services | Generally no | But may still trigger recusal under § 208 |
People disclose the paid consulting engagement and forget the volunteer board seat. That is backwards. Under § 2635.402 the financial interests of an organisation you serve as officer, director, trustee, general partner, or employee are imputed to you as if they were your own. An unpaid directorship creates exactly that imputation. The paid weekend job stocking shelves usually does not.
III The conflict test
Under subpart H, an outside activity conflicts with your official duties if either of two things is true:
- The activity is prohibited by statute or by your agency's supplemental regulation; or
- The activity would require your disqualification from government work that is central or critical to the performance of your official duties.
Limb two is the one that catches careful people. The question is not whether the outside work is respectable, or whether you would ever actually be biased. It is whether holding it would force you to recuse from work that is central to your job. If your position exists to regulate an industry and you take a role with a company in that industry, the recusal swallows the job — and the activity conflicts even if you would have been scrupulously fair.
Two engineers, same side job, different answers
Both work for the same agency. Both want to consult evenings for a firm that manufactures industrial valves.
IV Prior approval and agency supplements
Whether you must obtain approval before starting depends on your agency. Agencies may, by supplemental regulation, require employees or categories of employees to obtain prior approval before engaging in specific types of outside activity, and many have done so.
Those supplements are where the concrete prohibitions live. The Justice Department's supplemental regulation at 5 CFR part 3801, for instance, prohibits the outside practice of law unless approved. Other agencies restrict outside work in regulated industries, paid speaking, or expert-witness testimony.
The regulation is explicit that whether or not prior approval is required, you have a continuing responsibility to ensure your outside activities do not conflict with your official duties. An approval obtained in 2024 does not immunise an activity that became a conflict when your portfolio changed in 2026. Re-check when your duties change, not just when the activity does.
Ask your ethics official three things in writing: does my agency require prior approval for this category of activity, what form does that take, and does the activity as I have described it create a conflict. Keep every answer. The documentation practice matters here as much as anywhere.
V The five criminal statutes
Behind the administrative rules sit five sections of Title 18. These are criminal statutes, not policy, and they are the reason ethics officials answer cautiously.
| Section | What it prohibits | Typical outside-work trigger |
|---|---|---|
| § 203 | Compensation for representational services before the government | Being paid to help someone with an agency matter |
| § 205 | Representing others before the government | Acting as agent or attorney for an outside party, even unpaid |
| § 207 | Post-employment restrictions | What you may do after you leave — see private sector transition |
| § 208 | Acting officially on a matter affecting your own financial interests | The most common trap — see below |
| § 209 | Supplementation of your federal salary | An outside source paying you for your government work |
Penalties run under 18 U.S.C. § 216. A non-willful violation carries up to one year in prison; a willful violation up to five years. The Attorney General may also pursue civil penalties, calculated as a per-violation amount that is adjusted for inflation, or the amount of compensation received for the prohibited conduct, whichever is greater.
Section 205 does not require that you be paid. Representing another person before a federal agency — a friend's claim, a relative's application, a nonprofit's grant dispute — can violate it even as a favour. This is one of the most common unintentional violations among people who are simply trying to help someone.
VI Imputed interests — the trap
Section 208 prohibits you from participating personally and substantially, in an official capacity, in any particular matter that would have a direct and predictable effect on your own financial interests. Part 2640 is the implementing regulation; § 2635.402 summarises it.
The part that surprises people is imputation. Interests treated as your own include those of an organisation you serve as officer, director, trustee, general partner, or employee.
The illustrator problem
A government attorney works part-time as an illustrator for ABC Company. The side job has nothing to do with law, involves no government work, and was properly disclosed.
A second, softer layer sits at § 2635.502: even where § 208 is not triggered, an outside affiliation or business relationship may warrant disqualification from a government matter if a reasonable person would question your impartiality. That includes a “covered relationship” with a former employer, which persists for one year after separation from that employer.
VII Outside Activity Risk Screener
Describe the proposed activity. The screener names the provisions most likely to be implicated and what to ask your ethics official.
How Risky Is This Outside Activity?
Screening only. This is not an ethics opinion and cannot substitute for one — your agency's supplemental regulation may prohibit outright what this screener rates as low risk.
VIII Outside earned income limits
Most career employees face no cap on outside earnings. The limits in 5 CFR part 2636 apply to a defined group of covered noncareer employees.
| Who | Limit | Authority |
|---|---|---|
| Career employees | No outside earned income cap | — |
| Covered noncareer employees, including noncareer SES and certain others paid above a threshold rate | 15% of the Executive Schedule Level II rate as of January 1, prorated for partial years | 5 CFR 2636.304 |
| Senate-confirmed Presidential appointees | No earned income at all for outside employment during the appointment | E.O. 12674 § 102; 5 CFR 2635.804 |
The cap is calculated annually as a percentage of an Executive Schedule rate, so the dollar amount changes every January and any figure you find in an old memo is wrong. Ask your ethics office for the current year's number rather than relying on a published example.
Covered noncareer employees also face two restrictions that have nothing to do with dollars: they may not receive compensation for certain specified activities, and they may not allow their name to be used by a firm or entity providing professional services involving a fiduciary relationship. Those sit at §§ 2636.305 through 2636.307.
IX Where the other rules touch this
Outside employment rarely sits alone. Four adjacent regimes reach it.
Standards of conduct generally. Misuse of position, use of government property, and use of official time all constrain how you run an outside activity even when the activity itself is approved. Photocopying your side business's flyers on the office machine is a § 2635.704 problem regardless of how clean the employment approval was. See standards of conduct.
The Hatch Act. If the outside activity is political — a campaign role, paid work for a partisan organisation — the analysis shifts entirely to Hatch Act restrictions, and further-restricted employees face tighter rules than everyone else.
Financial disclosure. Outside positions and income are reportable on OGE Form 278 or 450 depending on your filing status. A disclosure that does not match what you told your ethics official is a problem in itself — see financial disclosure.
Seeking other employment. Negotiating for a future job is governed separately by subpart F, with its own recusal duties. Public filers must submit a written statement identifying the entity within three business days of commencing negotiations, and a notification of recusal where a conflict or the appearance of one arises.
X What happens when it goes wrong
Two tracks, and they can run at once.
Administratively, failing to obtain required approval or engaging in a conflicting activity is a conduct violation supporting discipline up to removal under the Chapter 75 adverse action process. It typically surfaces one of three ways: a financial disclosure review, an Inspector General investigation, or a complaint from someone who noticed. Where the agency proposes removal, an alternative may be available — see last chance agreements.
Criminally, the conflict statutes are prosecutable under § 216. Most matters resolve administratively, but the exposure is real, and it explains why an ethics official who seems overcautious is doing their job.
In practice, what turns a technical violation into a removal is rarely the outside work. It is having started without asking, or having described the activity in terms that omitted the part that mattered. An employee who disclosed fully and got it wrong has a mitigation case. An employee who never asked does not.
XI The playbook
| Situation | What to do |
|---|---|
| Considering a side job | Ask the ethics official in writing before you start. Describe it accurately, including hours and who the entity is. |
| Offered an unpaid board seat | Treat it as higher risk than a paid job. Officer and director roles impute the organisation's interests to you. |
| Entity is in your agency's regulated space | Expect limb two of the conflict test to bite. Ask what recusal would cover before accepting. |
| Helping a friend with an agency matter | Section 205 reaches unpaid representation. Ask first even when no money changes hands. |
| Already started without approval | Disclose now. The sequence is the aggravating fact, and it gets worse with time. |
| Your duties changed | Re-check. Approval does not travel with you to a new portfolio. |
| Noncareer SES or covered noncareer | Confirm this year's income cap with your ethics office. The figure changes each January. |
| Activity is political | Different rulebook. Go to the Hatch Act analysis first. |
| Negotiating a future private job | Subpart F applies, with a three-business-day statement for public filers. |
| Under investigation | Get counsel before the interview, not after. |
Before you take the outside role
- Request your agency's supplemental ethics regulation and its prior-approval form.
- Ask in writing whether approval is required for this category of activity.
- Describe the entity, your role, the hours, and the compensation accurately.
- State whether the entity is regulated by, contracts with, or litigates against your agency.
- Say plainly whether you would ever represent the entity before any federal agency.
- Identify whether your role is officer, director, trustee, or general partner — that changes the analysis.
- Ask what recusal the activity would require and whether that work is central to your duties.
- Confirm the current outside earned income cap if you are a covered noncareer employee.
- Keep the written response permanently, outside agency systems.
- Re-check the approval whenever your duties or the outside role changes.
Frequently asked questions
Generally yes. There is no government-wide ban on outside employment. What the rules prohibit is outside employment that conflicts with your official duties. Under 5 CFR part 2635 subpart H an outside activity conflicts if it is prohibited by statute or by your agency's supplemental regulation, or if it would require your disqualification from government work that is central or critical to the performance of your duties. Note how broad the definition is: outside employment means any non-federal business relationship or activity involving personal services, whether paid or unpaid, so volunteer roles and unpaid board seats count.
It depends on your agency, and you have to check rather than assume. Agencies may require prior approval by supplemental regulation for specific types of outside activity, and many do. The Justice Department, for example, prohibits the outside practice of law unless approved. Whether or not prior approval is required, you carry a continuing responsibility to ensure your outside activities do not conflict with your official duties, so approval is a floor rather than a safe harbour. Ask your agency ethics official in writing and keep the answer.
Five sections of Title 18. Section 203 covers compensation for representational services before the government. Section 205 covers representing others before the government. Section 207 covers post-employment restrictions after you leave. Section 208 prohibits participating personally and substantially in an official capacity in any particular matter that would have a direct and predictable effect on your own financial interests. Section 209 prohibits supplementation of your federal salary by an outside source. Penalties run under section 216: up to one year in prison for a non-willful violation and up to five years for a willful one, plus civil penalties.
It prohibits you from working, in your official capacity, on any particular matter that would have a direct and predictable effect on your own financial interests. The trap is that certain interests are imputed to you as if they were your own. Under 5 CFR 2635.402 those include the financial interests of an organization you serve as officer, director, trustee, general partner, or employee. So a government attorney who works part-time as an illustrator for a company cannot work on a government claim against that company, even though the side job has nothing to do with law. Part 2640 is the implementing regulation.
Not for most career employees. The outside earned income limits in 5 CFR part 2636 apply to covered noncareer employees, including noncareer SES appointees and certain other noncareer employees paid above a threshold rate. The cap is calculated as 15 percent of the rate of basic pay for Executive Schedule Level II as of January 1, and it is prorated for a partial year, so the dollar figure changes annually and you should confirm the current one with your ethics office. Senate-confirmed Presidential appointees are subject to a stricter rule and may not receive any outside earned income during the appointment.
Yes. Outside employment under these rules covers any non-federal business relationship or activity involving personal services, whether paid or unpaid. A volunteer board seat, an officer role in a nonprofit, or an unpaid advisory position all count, and they can carry more risk than a paid job because the financial interests of an organization you serve as officer, director, or trustee are imputed to you under 5 CFR 2635.402. People routinely disclose the paid consulting gig and forget the unpaid board seat that actually creates the conflict.
The consequences run on two tracks. Administratively, failing to obtain required approval or engaging in a conflicting activity is a conduct violation that can support discipline up to removal under the Chapter 75 adverse action process, and it commonly surfaces through an Inspector General investigation or a financial disclosure review. Criminally, violations of the conflict statutes are prosecutable under 18 U.S.C. 216 with up to one year for a non-willful violation and up to five years for a willful one, and the Attorney General may pursue civil penalties. Most cases resolve administratively, but the criminal exposure is real and it is why ethics officials are cautious.
Ask before you start, in writing, and describe the activity accurately rather than minimising it. Identify who the outside entity is, what you will do, how many hours, whether it involves anyone your agency regulates or contracts with, and whether you would ever represent that entity before the government. Request your agency's supplemental ethics regulation and its prior-approval form. Keep the written response permanently, because the question of what you disclosed and when is exactly what an investigator asks years later. If the answer is that the activity requires recusal from work central to your duties, that is the answer, and doing it anyway is the path that ends careers.