G.L. c. 268A, sections 4 (state employees), 11 (county employees) and 17 (municipal employees) impose limitations on public employees' private activities, including their private business activities. The rationale behind these prohibitions is that public employees should be loyal to the level of government in which they serve and when their loyalty to the government conflicts with their loyalty to another person or entity, the government's interest must prevail.
A public employee is generally prohibited from receiving compensation from anyone other than his government employer in connection with a particular matter that is of direct and substantial interest to the level of government in which he serves (i.e. a state employee may not receive private compensation in connection with a matter that is of direct and substantial interest to the Commonwealth; a county employee may not receive private compensation in connection with a matter that is of direct and substantial interest to the county in which they serve; and a municipal employee may not receive private compensation in connection with a matter that is of direct and substantial interest to the municipality in which they serve).
Additionally, public employees are prohibited from acting as agents (i.e. acting on behalf of another individual or entity) or acting as attorneys in connection with particular matters that are of direct and substantial interest to the level of government in which they serve, even if they do not receive any compensation for their services/actions.
Under sections 4, 11 and 17, it is not relevant whether the public employee will abstain from the matter in his official capacity, or whether the private entity or individual's interests and the Commonwealth's/county's/municipality's interests are the same. What matters is that the public employee is receiving private compensation or representing someone other than his government employer in connection with a matter in which the employing government has a direct and substantial interest.
Acting as Agent
The Commission has concluded that "the distinguishing factor of acting as agent within the meaning of the conflict law is 'acting on behalf of' some person or entity, a factor present in acting as spokesperson, negotiating, signing documents and submitting applications." See In Re Sullivan, 1987 SEC 312, 314-15. See also Commonwealth v. Newman, 32 Mass. App. Ct. 148, 150 (1992); Commission Advisory No. 88-01: Agency, Part A: Municipal Employees Acting as Agent; Commission Advisory No. 94-01, Agency, Part B: State Employees Acting as Agent; and Commission Advisory No. 94-02, Agency, Part C: County Employees Acting as Agent.
Direct and Substantial Interest
The Commission has indicated that to be direct and substantial the interests of the public entity in the outcome of proceedings must be significant and direct to the public entity as an institution, affecting substantial legal, pecuniary, or property rights or liabilities of the entity. See EC-COI-97-2.
State or County Employees Who Also Serve As Municipal Employees - The "Municipal Exemption"
Under both section 4 (state employees) and section 11 (county employees), state and county employees may also hold a municipal position. Under the "municipal exemption," a state/county employee may hold an elected or appointed office in a city, town or district, and may perform the duties of, and receive the compensation provided for, such office. If he earns compensation while holding the elected or appointed municipal office, however, he may not vote or act on any matter which is within the purview of the state/county agency by which he is employed or over which he has official responsibility.
Accordingly, a state/county employee who also serves as a paid municipal employee may not vote or act in his municipal position on any matter that falls within the authority or responsibility of the state/county agency by which he is employed, or is regulated, reviewed, or supervised by the state/county agency in which he is employed. However, he may vote or act on matters that fall under the authority of state/county agencies other than the agency by which he is employed.
On the other hand, if a state/county employee also serves as an uncompensated municipal employee, he may vote or act in his municipal position on matters of direct and substantial interest to the state/county, including matters within the purview of the state/county agency by which he is employed or over which he has official responsibility. For example, in his municipal position, he may discuss planning and strategy and participate in decision-making about matters in which his state/county agency has an interest. He may not act as agent for the municipality, however, in connection with any matter within the purview of the state/county agency by which he is employed or over which he has official responsibility.
For more information on the "municipal exemption" in sections 4 and 11, see EC-COI-92-22; EC-COI-82-89; and EC-COI-86-2.
Note that section 17 (municipal employees) does not have an exemption analogous to the "municipal exemption" in sections 4 and 11. Therefore, a municipal employee who is also a state/county employee may not participate as a state/county employee in particular matters in which the municipality by which they are employed has a direct and substantial interest.
Fewer Restrictions Apply to Special Public Employees
Sections 4, 11 and 17 apply less restrictively to public employees who are special state/county/municipal employees. A special state/county/municipal employee may receive compensation from, or act as agent or attorney for, someone other than the state/county/municipality in connection with a particular matter in which the state/county/municipality has a direct and substantial interest so long as: (1) he has not participated in the matter at any time as a public employee; (2) the matter is not, and in the last year has not been, a subject of his official responsibility, and (3) the matter is not pending in the state agency in which he is serving, if he is serving on more than 60 days in a year. If a special state/county/municipal employee serves for fewer than 60 days in a year, then the matter may be pending in his own state/county/municipal agency so long as the other two requirements are met.
For more information regarding special state/county/municipal employee status, see G.L. c. 268A, sections 1(m)-(o); Summary of the Law No. 16: Special Municipal Employees; and Advisory No. 06-01: Consultants and Attorneys Who Provide Services to Government Agencies May be Public Employees Subject to the Conflict of Interest Law.
Partners of Public Employees - Sections 5(d), 12(d), 18(d)
Partners of state/county/municipal employees may not knowingly act as an agent or attorney for anyone other than the state/county/municipality in connection with any particular matter in which the state/county/municipality or a state/county/municipal agency is a party or has a direct and substantial interest, and in which matter the state/county/municipal employee participates or has participated or which is the subject of his official responsibilities.