[Code of Federal Regulations]
[Title 5, Volume 3]
[Revised as of January 1, 2008]
From the U.S. Government Printing Office via GPO Access
[CITE: 5CFR2636.304]

[Page 610-611]
 
                    TITLE 5--ADMINISTRATIVE PERSONNEL
 
                CHAPTER XVI--OFFICE OF GOVERNMENT ETHICS
 
PART 2636_LIMITATIONS ON OUTSIDE EARNED INCOME, EMPLOYMENT AND AFFILIATIONS 
 
     Subpart C_Outside Earned Income Limitation and Employment and 
   Affiliation Restrictions Applicable to Certain Noncareer Employees
 
Sec. 2636.304  The 15 percent limitation on outside earned income.

    (a) Limitation applicable to individuals who are covered noncareer 
employees on January 1 of any calendar year. A covered noncareer 
employee may not, in any calendar year, receive outside earned income 
attributable to that calendar year which exceeds 15 percent of the 
annual rate of basic pay for level II of the Executive Schedule under 5 
U.S.C. 5313, as in effect on January 1 of such calendar year. The 
effective date of a change in the rate for level II of the Executive 
Schedule shall be the date on which a new rate of basic pay for level II 
first becomes applicable to any level II position.

    Note: Notwithstanding the 15 percent limitation described in this 
section, a covered noncareer employee who is a Presidential appointee to 
a full-time noncareer position is prohibited by section 102 of Executive 
Order 12674, as amended, from receiving any outside earned income for 
outside employment or any other activity performed during that 
Presidential appointment.
    Example 1. Notwithstanding that the compensation he will receive 
would not exceed 15 percent of the rate for level II of the Executive 
Schedule, a covered noncareer employee of the Department of Energy may 
not receive any compensation for teaching a university course unless he 
first receives the authorization required by Sec. 2636.307 of this 
subpart.

    (b) Limitation applicable to individuals who become covered 
noncareer employees after January 1 of any calendar year. The outside 
earned income limitation that applies to an individual who becomes a 
covered noncareer employee during a calendar year shall be determined on 
a pro rata basis. His outside earned income while so employed in that 
calendar year shall not exceed 15 percent of the annual rate of basic 
pay for level II of the Executive Schedule in effect on January 1 of the 
calendar year divided by 365 and multiplied by the

[[Page 611]]

number of days during that calendar year that he holds the covered 
noncareer position.

    Example 1. A former college professor received an appointment to a 
noncareer Senior Executive Service position on November 1, 1991. The 
rate of basic pay in effect for Executive Level II on January 1, 1991 
was $125,100. For the 61 day period from November 1, 1991 through 
December 31, 1991, the amount of outside income he may earn is limited 
to $3,129. That amount is determined as follows:
    Step 1. The rate of basic pay for Executive Level II as in effect on 
January 1 of that year ($125,100) is divided by 365. That quotient is 
$342;
    Step 2. The dollar amount determined by Step 1 ($342) is then 
multiplied by the 61 days the employee held the covered noncareer 
position. That product is $20,862;
    Step 3. The dollar amount determined by Step 2 ($20,862) is 
multiplied by .15 or 15 percent. The product ($3,129) is the maximum 
outside earned income the employee may have in the particular year 
attributable to the period of his service in a covered noncareer 
position.

    (c) Computation principle. For purposes of any computation required 
by this section, any amount of $.50 or more shall be rounded up to the 
next full dollar and any amount less than $.50 shall be rounded down to 
the next full dollar.
    (d) Year to which outside earned income is attributable. Regardless 
of when it is paid, outside earned income is attributable to the 
calendar year in which the services for which it is paid were provided.