Landlords Use Of Criminal Records for Housing Decisions
The Application of Fair Housing Act Standards to the Use of Criminal Records by Landlords for Housing Decisions
The Fair Housing Act prohibits discrimination in the sale, rental, or financing of dwellings and in other housing-related activities on the basis of race, color, religion, sex, disability, familial status or national origin.
The U.S. Department of Housing and Urban Development (HUD) recently issued guidance concerning how the Fair Housing Act applies to the use of criminal history by providers or operators of housing and real-estate related transactions. Specifically, the guidance addresses how the discriminatory effects and disparate treatment methods of proof apply in Fair Housing Act cases in which a housing provider justifies an adverse housing action – such as a refusal to rent or renew a lease – based on an individual’s criminal history.
As background, Department of Justice statistics show nearly one-third of the U. S. population has a criminal record of some type. While individuals with criminal records are not currently a protected class under the federal Fair Housing Act, the use of criminal history-based barriers to housing have a statistically disproportionate impact on minorities, which are a protected class under the Act. Specifically, racial and ethnic minorities, particularly African-Americans and Hispanics, are arrested, convicted and incarcerated at rates disproportionate to their share of the general population.
Discriminatory Effects Liability
Discriminatory effects liability holds that a policy or practice may be considered discriminatory if it has a disproportionate adverse impact against any group based on protected classes when there is no legitimate, nondiscriminatory business need for the policy or practice.
A landlord’s policy or practice that restricts access to housing on the basis of criminal history, if it does not serve a substantial, legitimate, nondiscriminatory interest of the landlord, or if such interest could be served by another practice with less discriminatory effect, has a disparate impact on individuals of particular race, national origin, or other protected class and is unlawful under the Fair Housing Act.
When a landlord’s policy or practice has an unjustified discriminatory effect, the landlord has violated the Fair Housing Act even when there was no intent on the landlord’s part to discriminate. A facially neutral policy or practice that has discriminatory effect is unlawful if the policy or practice is not supported by sufficient legal justification.
A three-step burden-shifting standard requiring fact-specific analysis is required to assess discriminatory effects liability.
Step 1. Evaluating whether the criminal history policy or practice has a discriminatory effect
A landlord may offer evidence to refute a claim that the landlord’s policy or practice causes a disparate impact on one or more protected classes. Evidence such as applicant data, tenant files, demographic data and local criminal justice data may be relevant to determine whether there is reasonable cause to believe the challenged policy or practice causes disparate impact.
Step 2. Evaluating Whether the Challenged Policy or Practice is Necessary to Achieve a Substantial, Legitimate, Nondiscriminatory Interest
The landlord has the burden to prove that the challenged policy or practice is necessary to achieve a substantial, legitimate, nondiscriminatory interest of the landlord. Such interest may not be hypothetical or speculative, meaning that the landlord must provide evidence proving both that the landlord has such an interest supporting the challenged policy and the challenged policy actually achieves that interest.
Protecting property and the safety of residents are usually considered substantial and legitimate landlord interests provided they are the actual reasons for the policy or practice. The landlord must however prove through reliable evidence that his policy or practice regarding housing decisions based on criminal history actually does assist in protecting resident safety and/or the property. In order to prove his interest a landlord cannot use generalizations or stereotypes that an individual with an arrest or conviction record is a greater risk than an individual without a record.
Exclusions Because of Prior Arrest
Arrest records do not provide a reliable basis for assessment of the individual’s potential risk to resident safety or property. Records may be incomplete and fail to indicate whether the individual was prosecuted, convicted, or acquitted. A landlord who denies access to housing to individuals on the basis of arrests not resulting in conviction cannot prove that the exclusion actually assists in protecting property or resident safety.
Exclusions Because of Prior Conviction
Generally a record of conviction is sufficient evidence to prove criminal conduct of an individual. However, landlords whose policy or practice excludes individuals with prior convictions must still be able to prove that the policy or practice is necessary for a substantial, legitimate, nondiscriminatory interest. A blanket prohibition on any individual with a conviction record, regardless of when the conviction occurred, the details of the individual’s conduct, and what the individual has done since then, will not meet the burden of proof.
A landlord whose policy or practice excludes individuals with only certain types of convictions must still prove that the policy or practice is necessary to serve the legitimate nondiscriminatory interest. The landlord’s policy or practice must accurately distinguish between criminal conduct that indicates a demonstrable risk to resident safety and/or property and criminal conduct that does not. A policy or practice that fails to take into account the nature, severity, and timeframe of an individual’s criminal conduct is unlikely to be proven necessary to serve a substantial, legitimate, and nondiscriminatory interest of the landlord.
Statutory Exemption Exclusion Because of Illegal Manufacture or Distribution of a Controlled Substance
A landlord is not held liable under the Fair Housing Act for excluding individuals who have been convicted of specified drug crimes of illegal manufacture or distribution of a controlled substance regardless of any discriminatory effect resulting from such a policy.
Step 3. Evaluating Whether There Is a Less Discriminatory Alternative
If a landlord successfully proves his policy or practice is necessary to achieve substantial, legitimate, nondiscriminatory interest, the plaintiff then bears the burden that such an interest could be served by another practice that has a less discriminatory effect. Proving a less discriminatory effect might include an individualized assessment of the facts and circumstances surrounding the criminal conduct, taking into account the age of the individual at the time of the conduct, evidence of satisfactory rental history before and/or after the criminal conduct, and the individual’s rehabilitation efforts.
Conclusion
Landlord policies or practices used to make housing decisions that exclude individuals based on criminal history must be tailored to serve the landlord’s substantial, legitimate, nondiscriminatory interest. Consideration must be given to such factors as the type of the crime and the length of the time since conviction. Where a policy or practice excludes individuals with only certain types of convictions, a landlord will still bear the burden of proving that any discriminatory effect caused by such policy or practice is legally justified.
The Fair Housing Act prohibits both intentional housing discrimination and housing practices that have an unjustified discriminatory effect because of race, national origin or other protected characteristics. While the Act does not prohibit housing providers from appropriately considering criminal history information when making housing decisions, arbitrary and overbroad criminal history-related bans are likely to lack a legally sufficient justification. Thus,” a discriminatory effect resulting from a policy or practice that denies housing to anyone with a prior arrest or any kind of criminal conviction cannot be justified, and therefore such a practice would violate the Fair Housing Act.”