From the introduction to the CRS Legal Sidebar, The Federal Anti-Nepotism Statute: Limits on Appointing, Hiring, and Promoting Relatives (12/1/2016):
The process of presidential transition has raised questions about who may be appointed to certain executive posts in the White House, an issue addressed under a federal law commonly known as the anti-nepotism statute. Nepotism is defined generally as the exercise of favoritism by a person in a position of authority towards that person’s relatives, particularly giving them jobs. The federal anti-nepotism statute applies to all public officials (including the President and Members of Congress) in all three branches of the federal government. Such officials are barred from appointing, hiring, or promoting – or advocating for the appointment, hiring, or promotion of – a specific class of relatives to a civilian position in the agency in which that official serves or over which the official exercises authority.
More generally, see Aneil Kovvali’s Constitutional Avoidance and Presidential Power, 35 Yale J. on Reg. Bull. (2017 Forthcoming). Here’s the abstract:
Recent developments have brought renewed attention to statutes designed to constrain and discipline the President. The federal anti-nepotism statute, the federal conflict of interest statute, the Federal Advisory Committee Act, and the Freedom of Information Act all appear set to endure unusual stress in the coming years. Troublingly, these statutes have already been given limited constructions that weaken their power to restrain the President. Under the constitutional avoidance canon, courts construe statutes so as to avoid constitutional questions. Citing the avoidance canon and the President’s actual (or merely arguable) constitutional prerogatives, courts have limited the scope of statutes meant to discipline the presidency. Constitutional avoidance is a time-honored principle, but its application in this context is uniquely troubling. The President is an active participant in the legislative process, and can use his veto power to protect his prerogatives for himself. As a result, this type of judicial involvement can distort results in a way that is difficult, if not impossible, for Congress to reverse. The President’s unique powers also make the application of constitutional avoidance particularly problematic in this context.