Advisory Opinion No. 2011-19 Advisory Opinion No. 2011-19 Re: Charles J. Fogarty, Director QUESTION PRESENTED The Petitioner, the Director of the Department of Labor and Training, a state appointed position, requests an advisory opinion regarding what appropriate measures he must take in order to avoid conflicts of interest arising from the fact that his first-cousin's husband is a long-time employee of the department currently serving as its Assistant Director of the Division of Workers' Compensation. RESPONSE It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics requires the Petitioner's recusal from decisions that impact his family member's personal finances or continued employment at the Department of Labor and Training, such as performance evaluation, classification, promotion, transfer or discipline. Upon such recusal, the Petitioner's proposed alternative chain of command as to his family member is reasonable and sufficient to insulate the Petitioner from apparent conflicts of interest. The Petitioner was recently appointed by the Governor as Director of the Rhode Island Department of Labor and Training ("DLT").[1] He seeks guidance from the Ethics Commission regarding what appropriate measures he must take in order to avoid conflicts of interest arising from the fact that his first-cousin's husband is a long-time employee of the DLT currently serving as its Assistant Director of the Division of Workers' Compensation. The Petitioner represents that his first-cousin is married to Matthew Carey ("Mr. Carey"), a DLT employee. Mr. Carey has worked for the DLT since 1986, when he was hired as an Employee Assistant within the Workers' Compensation Division. For the past thirteen years, since 1998, Mr. Carey has served as the Assistant Director for the Division of Workers' Compensation. According to the Petitioner, this division includes approximately fifty (50) employees across the following units: Data Collection and Claims Analysis; Workers' Compensation Administrative Fund; Fraud and Compliance; Self-Insurance; and the Donley Rehabilitation Center. The Petitioner states that, pursuant to the organizational structure of the DLT, Assistant Directors of the various divisions are under the authority of a Deputy Director who, in turn, reports to the Director. Notwithstanding this formal chain of command, the Assistant Directors have access to the Director and interact with him concerning issues relative to the function of each division. Given the Petitioner's appointment and his familial relationship to one of the DLT's longstanding Assistant Directors, the Petitioner seeks guidance from the Ethics Commission as to how to appropriately avoid or minimize any conflicts of interest in the performance of his public duties as Director. The Ethics Commission enacted Regulation 36-14-5004, entitled "Nepotism," to address conflicts of interest arising from family relationships. Among the several sections in this regulation is one concerning the supervision of a family member. Subsection (b)(2), entitled "Advocacy/Supervision regarding Family/Household Members," reads: (A) No person subject to the Code of Ethics shall participate in the supervision, evaluation, appointment, classification, promotion, transfer or discipline of any person within his or her family or a household member, in the state or municipal agency in which the official or employee is serving or over which he or she exercises fiscal or jurisdictional control, except in accordance with particular instructions and advice received from the Ethics Commission in a written advisory opinion. (B) No person subject to the Code of Ethics shall delegate to a subordinate any tasks relating to the supervision, evaluation, appointment, classification, promotion, transfer or discipline of any person within his or her family or household members, except in accordance with particular instructions and advice received from the Ethics Commission in a written advisory opinion. Regulation 36-14-5004(b)(2)(A) and (B). This regulation also clarifies that the Petitioner's first-cousin's husband, his "first-cousin-in-law," is a "person within [the Petitioner's] family" for purposes of applying Regulation 36-14-5004. Regulation 36-14-5004(a)(2). In order to minimize or avoid potential conflicts of interest under Regulation 5004, the Petitioner has proposed recusing himself from any decision-making relating to the employment of Mr. Carey. Thereafter, issues regarding the supervision, evaluation, appointment, classification, promotion, transfer or discipline of Mr. Carey would be carried out by the DLT's Deputy Director, who would neither consult with nor accept input from the Petitioner as to such issues. The Petitioner further proposes that the Deputy Director's decisions relative to Mr. Carey's employment would be subject to the support and review of the Department of Administration's ("DOA") Deputy Personnel Administrator for the Division of Human Resources and, if necessary, by the Director of the DOA. The Petitioner notes that the DOA's Deputy Personnel Administrator, who is not under the Petitioner's authority or supervision, is already responsible for the personnel administration function of the DLT. The Ethics Commission has acknowledged that in circumstances in which a public official sits atop a chain of command, a complete and effective recusal can be difficult or impossible to achieve, given that upon the official's recusal the matter must still be carried out by one of the official's subordinates. In such cases, so that the necessary work of a public agency can continue, the Commission has approved alternative chain of command structures. For example, in Advisory Opinion 2005-14, the Director of the Rhode Island Department of Health ("DOH") sought guidance as to how to comply with the Code of Ethics given that the DOH had regulatory authority over his spouse, a physician, and also considering that his spouse was a key employee of a private company that had pre-existing contracts with the DOH. In light of the Director's position at the top of the DOH chain of command, it was not feasible to prohibit all of the Director's subordinates from participating in matters that involved the Director's spouse. Instead, the Commission approved a plan offered by the Director, whereby he would agree to personally recuse from any participation in such matters and any final decision-making would instead be performed by the Managing Director of Health and Human Services, another cabinet-level Director who was not subordinate to the petitioner. See also A.O. 2010-1 (recognizing that it was not feasible to require that all of the General Treasurer's subordinates recuse from decisions impacting the Treasurer's family members, the Ethics Commission approved a procedure in which the Treasurer recused from the decision-making in favor of an alternative chain of command within the department); A.O. 2005-19 (noting that as all employees of a police department are subordinate to the Chief of Police, and since it is not feasible to require the entire department to recuse on matters impacting the Chief's brother, a lieutenant in the department, the Commission found that a proposed, alternative chain-of-command, in which ultimate decision-making as to the Chief's brother would be performed by the Mayor, was reasonable and sufficient to insulate the Chief from apparent conflicts of interest); A.O. 2000-16 (opining that the Director of Rhode Island Housing ("RIH") must recuse on decisions impacting his spouse, who is the Executive Director of a not-for-profit agency that receives funding from RIH, but it is not feasible or required that all other RIH employees also recuse, as long as final decision-making is made by a member of the RIH Board of Directors). The unique circumstances presented by this Petitioner, involving a gubernatorial appointment as Director of a department that has employed his cousin's spouse as an Assistant Director for thirteen years prior to the appointment, similarly justify our approval of a reasonable and achievable alternative chain of command. Regulation 5004 requires the Petitioner's recusal from decisions that impact Mr. Carey's personal finances and continued terms of employment at DLT, such as evaluation of performance, classification, promotion, transfer or discipline. Notice of recusal must be filed with the Ethics Commission pursuant to section 36-14-6. Upon recusal, these matters must be handled by the Deputy Director, without input from the Petitioner. Such decisions may be supported and reviewed by appropriate personnel administrators in the DOA. Notwithstanding this recusal and alternative chain of command requirement, the Ethics Commission recognizes that, as Director of the DLT, the Petitioner must necessarily interact with and to some extent direct the day-to-day efforts of all of his employees, including Mr. Carey. Such interactions, provided they do not impact Mr. Carey's personal finances or continued terms of employment, are not prohibited. Code Citations & Other Authority: R.I. Const. art. IX, sec. 5 R.I. Gen. Laws § 36-14-6 Commission Regulation 36-14-5004 Related Advisory Opinions: 2010-1 2009-34 2009-26 2008-54 2007-29 2005-19 2005-14 2002-42 2000-16 95-71 95-13 Keywords: Family: Public Employment Nepotism Issued March 8, 2011 [1] The Governor's power to appoint executive branch officers, subject to the advice and consent of the Senate, is expressly set forth in the Rhode Island Constitution. R.I. Const. art. IX, sec. 5.