If I got this right, then an "invalid date range" is a range that is not
covered by the dates in the code table, correct?

That does look quite fine to me.  I'd probably do it that way:
(1) check for each interval/range in the main table if it overlaps with a
range in the code table, and
(2) if it overlaps, then check that the date right before and after the
overlaps are covered by another range from the code table

SELECT ...
FROM   main AS m JOIN code_table AS ct ON
         m.code = ct.code
WHERE  m.start_date < ct.end_date AND
      m.end_date > ct.eff_date AND
      -- check if another range in CT lies before the current one
      -- (only if the range in main exceeds the range in CT)
      CASE
         WHEN m.start_date < ct.eff_date
         THEN ( SELECT MAX(1)
                FROM   code_table AS b
                WHERE  b.code = m.code AND
                       b.end_date >= m.start_date AND
                       b.eff_date <= m.start_date )
         ELSE 0
      END = 1 AND
      -- check if another range in CT lies after the current one
      -- (only if the range in main exceeds the range in CT)
      CASE
         WHEN m.end_date > ct.end_date
         THEN ( SELECT MAX(1)
                FROM   code_table AS a
                WHERE  b.code = m.code AND
                       b.eff_date <= m.end_date AND
                       b.end_date >= m.end_date )
         ELSE 0
      END = 1

The subselects in the case expressions could also be rewritten, I'd say,
Maybe that would make things more clearer.

You also need to check if anyone is before the earliest date.

B.

This was a good exercise. It took me a while to come up with a
solution, and that's how i learn things. Here's my solution, which is
just what i came up with, not that it is better than anybody else's.

The CASE expressions are because the DATE given is the final valid DATE
in db2, and adding a DAY results in SQL0183N. I add a DAY (or subtract)
because the end date of one range can be one day before the begin date
of the next range, and there will be no missed days. Since your example
provide the final valid DATE, i assumed there could be the earliest one
too.

The GROUP BY at the end is simply so only one row shows up per row in
the Main TABLE, otherwise more than one may appear. In this example,
two rows would appear instead.

I like my solution because it is straightforward. The WITH provides the
bad days being check for, and then a simple BETWEEN is used.

DECLARE GLOBAL TEMPORARY TABLE Main
(
Row        INTEGER,
Emp_Id        INTEGER,
Code        CHAR(0002),
Start_Date    DATE,
Stop_Date    DATE
) WITH REPLACE

DECLARE GLOBAL TEMPORARY TABLE Code_CT
(
Code        CHAR(2),
Desc        VARCHAR(0040),
Eff_Date    DATE,
End_Date    DATE
) WITH REPLACE

INSERT INTO SESSION.Main
VALUES
(1, 98233, 'AA', '05/05/2000', '12/28/2000'),
(2, 98235, 'AA', '05/05/2000', '04/21/2001')

INSERT INTO SESSION.Code_CT
VALUES
    ('AA', 'Hospitals',        '01/01/2000', '12/29/2000'),
    ('AA', 'Hospitals, Schools',     '01/01/2001', '12/31/9999'),
    ('XX', 'N/A',            '01/01/2009', '12/31/9999')

WITH Bad_Day (Code, The_Day) AS
(
SELECT
    Code,
    End_Date + 1 DAY
FROM
    SESSION.Code_CT Outer
WHERE
    End_Date < DATE('12/31/9999')
  AND    NOT EXISTS
    (
    SELECT
        *
    FROM
        SESSION.Code_CT Inner
    WHERE
        Inner.Code    = Outer.Code
      AND    Outer.End_Date    BETWEEN
                    CASE Inner.Eff_Date
                    WHEN DATE('01/01/0001') THEN Inner.Eff_Date
                    ELSE Inner.Eff_Date - 1 DAY
                    END
                   AND    CASE Inner.End_Date
                    WHEN DATE('01/01/0001') THEN Inner.End_Date
                    ELSE Inner.End_Date - 1 DAY
                    END
    )
UNION ALL
SELECT
    Code,
    Eff_Date - 1 DAY
FROM
    SESSION.Code_CT Outer
WHERE
    Eff_Date > DATE('01/01/0001')
  AND    NOT EXISTS
    (
    SELECT
        *
    FROM
        SESSION.Code_CT Inner
    WHERE
        Inner.Code    = Outer.Code
      AND    Outer.Eff_Date    BETWEEN
                    CASE Inner.Eff_Date
                    WHEN DATE('12/31/9999') THEN Inner.Eff_Date
                    ELSE Inner.Eff_Date + 1 DAY
                    END
                   AND    CASE Inner.End_Date
                    WHEN DATE('12/31/9999') THEN Inner.End_Date
                    ELSE Inner.End_Date + 1 DAY
                    END
    )
)
SELECT
    Main.Row,
    Main.Emp_Id,
    Main.Code,
    Main.Start_Date,
    Main.Stop_Date,
    MIN(Bad_Day.The_Day)
FROM
    SESSION.Main    Main,
    Bad_Day
WHERE
    Main.Code    = Bad_Day.Code
 AND    Bad_Day.The_Day    BETWEEN Main.Start_Date AND Main.Stop_Date
GROUP BY
    Main.Row,
    Main.Emp_Id,
    Main.Code,
    Main.Start_Date,
    Main.Stop_Date

DROP TABLE SESSION.Main
DROP TABLE SESSION.Code_CT

B.