FAA Order 3750.7, outside employment in general is permitted so long as it neither conflicts with official Government duties and responsibilities nor appears to do so. Employees are permitted to engage in outside aviation employment so long as the outside employer does not conduct activities for which the employee's facility or office has official responsibility.
As a controller the employee must submit an approval request to hold outside employment within aviation employment. The agency has 30 days to respond to your approval request.
FAA Order 3750.7 (Appendix 5) is the policy for employment. I have flown for a couple organizations and asked FAA Legal about them. They were "based outside my area of jurisdiction" and were therefore OK.
The basic rule quoted earlier is correct, you
MAY NOT BE AN EMPLOYEE of an airline/air taxi/flight school/FBO/whatever as long as it is based in your "area of responsibility." This includes any airlines/companies flying into the airport which you work, and also any airlines that are related to airlines that operate out of the airport at which you work. For example, if ASA flies out of your airport, you may also not
be an employee of SkyWest, since they own ASA.
Using buddy passes or other flight benefits falls into the same category. If the airline operates out of your airport, its verboten (see
http://www.faa.gov/about/office_org/headquarters_offices/agc/pol_adjudication/agc400/ethics/media/flight%20policy.pdf ). Now, if you work at DeKalb-Peachtree and Delta doesn't fly out of there, it's fine. On the other hand, I don't think TSA is comparing our names to the F'nAA watch list either.
I HAVE gotten double-secret permission to flight instruct at airports in our airspace provided it was in the owners airplane (we weren't renting from one flight school or another) and I didn't advertise it.... Oops... Looks like I just did... But speaking of that, PLEASE if you know someone who is doing this please help us out and keep it under your hat. We will thank you later.
Sorry, very long explanation, but here's the summary: You may not
BE AN EMPLOYEE of those companies that operate out of your area of responsibility. They don't say you can't work for them...
Happy Flying.