Follow Four Rules to Guard Against Race Discrimination Claims

Last October, the Fair Housing Justice Center (FHJC), a New York City-based nonprofit civil rights organization, filed a lawsuit against an apartment building owner for allegedly defying housing discrimination laws. The owner, through its employees, allegedly lied to African Americans about the availability and rental rates in at least one Brooklyn apartment, turned back applicants with public rent assistance elsewhere, and made children undergo unnecessary lead tests.

The FHJC said it built its case against the owner using testers posing as prospective tenants. According to the FHJC’s website, the organization initiates fair housing testing investigations to identify, document, and eliminate systemic housing discrimination. The organization oversees a testing program, Acting for Justice, which hires professional actors and entertainers as “testers.” Testers pose as ordinary home seekers to observe the business practices of housing providers and others in order to determine if housing providers are complying with fair housing laws.

The FHJC sent black and white testers to the building throughout 2016, and in multiple instances, black testers were told nothing was available and dismissed, while white testers were welcomed inside to see apartments. The complaint outlined multiple examples of this alleged behavior, describing how the building superintendent was very helpful to white testers who came looking for apartments. The super told white testers about tenants who were planning to break their leases and even described another building the owner had as “super, super Jewish,” the suit alleged.

However, when black testers showed up, the superintendent was reticent about saying whether apartments were available, cutting off one tester who was asking about an apartment by repeatedly saying “nope” and then telling him about a building across the street being available on Zillow, the suit stated.

At the city level, the NYC Human Rights Law prohibits discrimination in housing in New York City. This means that any person leasing an apartment including owners, superintendents, and building managers cannot discriminate because of a person’s actual or perceived protected status under the law. The protected classes covered under the New York City Human Rights Law are:

• Age
• Alienage or Citizenship Status
• Color
• Disability
• Gender
• Gender Identity
• Lawful Occupation
• Lawful Source of Income (including housing subsidies): The term lawful source of income includes without limitation income derived from Social Security, or any form of federal, state, or local public assistance or housing assistance including Section 8 vouchers.
• Marital or Partnership Status
• Race
• Religion/Creed
• National Origin
• Pregnancy
• The Presence of Children
• Sexual Orientation
• Status as a Victim of Domestic Violence, Stalking, and Sex Offenses
• Status as a Veteran or Active Military Service Member

Anti-discrimination laws from the federal to city level have protected against racial discrimination in housing for as long as they’ve been enacted. For much of the law’s history, the majority of formal fair housing complaints have been based on race. And fair housing enforcement officials and fair housing advocates remain vigilant for racial discrimination in housing. We’ll suggest four rules to ensure compliance with fair housing law.

Rule #1: Keep Race Out of the Leasing Process

It’s illegal to allow race to play any part in decisions about who may live in your building. The law bans refusing to rent or making housing unavailable to anyone based on his race—or that of his household members or anyone associated with him. It’s unlawful to represent to anyone, because of his race, that a dwelling is not available for rental when such dwelling is in fact available. Furthermore, the law bars unequal treatment in the application process, for example, by using different rental procedures or screening criteria—such as income standards, application requirements, application fees, credit analysis, rental approval procedures, or other requirements—because of race or other protected characteristic.

To ward off discrimination claims, adopt racially neutral policies, procedures, and qualification standards for leasing apartment in your building. Include a fair housing policy that makes it clear that your building is an equal housing provider.

Rule #2: Focus on Employee Training

Putting solid nondiscriminatory policies down on paper is a good first step, but effective employee training will put them into action. In every workplace, employers create rules, but they can be forgotten or worse—ignored—unless employers take the time to emphasize why the rules are so important. In the multifamily housing environment, the rules are there to shield not only the building, but also the employees themselves, from potential liability for a violation of fair housing law. Employees, managers, and other individuals could face personal liability for discrimination under the federal Fair Housing Act and New York State and City Human Rights Laws, so they have a vested interest in following the rules.

Among other things, your building’s policies should stress that employees could trigger a fair housing claim based on their comments, offhand or otherwise, that express a preference for or against someone based on race. Explain that employees could be accused of unlawful steering if, through their comments or conduct, they discourage a prospect, based on race or other protected characteristic, from living in the building or in certain parts of the building. Make sure that employees understand that even well-intended actions could amount to unlawful steering—for example, by showing prospects only units where neighboring units are occupied by people of the same race. The law bans any conduct that limits a prospect’s housing choices based on race, so employees must understand—and consistently follow—rules requiring leasing agents to tell prospects about all available units that meet their requirements.

Provide periodic fair housing training not only to your leasing staff, but also to all employees who may have contact with the public, residents, or their guests. And make sure to include fair housing basics in the training provided to new hires. Keep records of the dates and names of employees who attended training to document your efforts to ensure fair housing compliance.

Rule #3: Prevent Personal Biases from Derailing Fair Housing Efforts

Even the best policies and training won’t protect your building from fair housing problems if an employee’s personal biases are allowed to spill into the leasing office or elsewhere in the building.

Keep personal biases out, starting with the first contact from a prospective resident. Whether it’s in person, by telephone, by email, or other online contact, inquiries from prospective residents about the availability of housing at your building must be treated the same, regardless of their actual or perceived race. A common form of fair housing testing is to check for “linguistic” profiling—that is, phone calls from paired testers, one of whom sounds like a member of a racial minority—to determine if they are treated differently.

Increasingly, fair housing testing has turned to online communications—that is, comparing the responses to emails from paired testers, one of whom has a name that suggests she’s a member of a racial minority. Often, the tests reveal significant differences in response rates based on the perceived race from the name in the email. Researchers have studied the content of the responses and reported finding signs of subtle discrimination: Replies sent to prospects perceived to be white were longer and sent more quickly, and the language used was more polite, contained more information, and invited further correspondence more often than those sent to the prospects perceived to be African American.

Rule #4: Make Sure Rules Are Fair—and Enforced Fairly

Fair housing claims often stem from adverse actions taken against residents for violating lease provisions or building policies or rules. In some cases, it’s a claim of “disparate treatment”—that is, that the rules are being selectively enforced because of a resident’s race or other protected characteristic. Less commonly, it’s a claim of “disparate impact,” where seemingly neutral rules have a disproportionate effect on racial minorities or other protected groups. You can successfully defend against such claims with proof of a legitimate, nondiscriminatory reason for the policy or rule—and proof that it’s applied consistently without regard to race or other protected characteristic.

One example of potentially triggering a disparate impact claim involves owners who have blanket bans on renting to people with criminal records. Although criminal convictions may be grounds for housing providers to deny applicants after appropriate inquiry, fair housing laws prohibit owners from applying overly broad bans on those convicted of crimes, because such bans are likely to discriminate against minorities.

Fair housing law requires owners to consider individual facts such as the type and severity of the offense and how long ago the offense occurred. Because certain groups of people, such as African Americans, have higher statistical rates of arrests and convictions, blanket bans have the effect of making it harder for African Americans than for other groups to find housing. This disparate impact renders blanket policies illegal.

If a tester applies posing as a prospect with a felony conviction, the appropriate response would be to follow up with questions as to the nature, circumstances, and timing of the felony. The incorrect response that would raise a red fair housing flag would be to flatly deny the applicant based on the mention of a criminal history, without asking for any further information.

Editor’s Note: For more information on complying with fair housing law while running criminal background checks, you can download the one-hour on-demand webinar, “Applicant Screening and Criminal Histories: Addressing Disparate Impact Liability Under the Fair Housing Act,” here or at www.VendomeRealEstateMedia.com.