NOT A NATIVE TEACHER
Sample context:
It's you, me and Tom.
1)
While I am walking in the park, I see Tom. I have small talk with Tom and ask him about his life and job.
Me: Hey Tom. How's it going man?
Tom: Fine, finally I'm retired. But, as you know, I do some undercover work for the communications.
After some days, you see me and ask me about Tom (probably a mutual friend).
You: What does Tom do?
Me: I saw him the other day. Now he's retired, but he said that he does some undercover work for the communications.
This is reported speech. Since it's still true, no back-shift is required.
2)
While I am walking in the park, I see Tom. I have small talk with Tom and ask him about his life and job.
Me: Hey Tom. How's it going man?
Tom: Fine, finally I'm retired. But, as you know, I do some undercover work for the communications.
After some months, you see me and ask me about Tom (probably a mutual friend).
You: What does Tom do?
Me: I saw him some months ago. Now he's retired, but he said that he did some undercover work for the communications.
Back-shift is required and there is this sense that he doesn't do it anymore.
3)
While I am walking in the park, I see Tom. I have small talk with Tom and ask him about his life and job.
Me: Hey Tom. How's it going man?
Tom: Fine, finally I'm retired. But, as you know, I did some undercover work for the communications.
Some days later, you see me and ask me about Tom (probably a mutual friend).
You: What does Tom do?
Me: I saw him the other day. Now he's retired, but he said that he had done some undercover work for the communications.