How to Fulfill Your Duty to Prevent Race Discrimination (Article 4) - Review Your Criminal Background Policy

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Manufactured Housing Communities of Oregon

Criminal background checks are the latest battleground for potential race discrimination claims. If it’s been a while since you last reviewed your policy, it’s important to check to make sure your policy doesn’t run afoul HUD guidelines addressing the discriminatory effect that criminal background policies may have on racial and ethnic minorities.

The vast majority of fair housing cases are for intentional discrimination (or what’s known as “disparate treatment”—that is, purposely treating people differently because of their race, color, or other protected characteristics. But you could face a fair housing claim even when there’s no intent to discriminate: In what’s known as “disparate impact” claims, communities may be held liable for policies or practices that appear to be neutral, but have an unjustified discriminatory effect on minorities or others protected under fair housing law.

Example: In November 2019, the owners and operators of a 900-unit New York apartment complex agreed to pay $1.1 million to settle a race discrimination case alleging that the community enforced a policy prohibiting anyone with a criminal record from living there. The complaint alleged that the policy unlawfully discriminated because it disproportionately barred African Americans and Latinos from housing without considering each potential resident’s individual history and circumstances. The community denied the allegations but agreed to settle the case.

Example: In August 2019, a Virginia community agreed to settle allegations that its criminal background screening policy discriminated against people on the basis of race. The complaint was based on the results of a fair housing testing conducted by advocacy groups to assess the barriers individuals with criminal histories face when seeking housing. Allegedly, the testing showed that testers posing as prospects were told that their applications would be automatically rejected because of their felony convictions. The community denied the allegations but agreed to the settlementrequiring payment of damages and attorney’s fees.


HUD Guidance on Criminal Background Checks

In 2016, HUD issued guidance on how federal fair housing law applies to the use of criminal records in both conventional and government-assisted housing communities. HUD cited statistics showing that African Americans and Hispanics are arrested, convicted, and incarcerated at disproportionately higher rates than whites with respect to their share of the general population. The guidelines don’t prevent communities from screening applicants based on their criminal history, but you could face a fair housing complaint if your criminal screening policy, without justification, has a disparate impact—or discriminatory effect—on minority applicants.

If you haven’t updated your policy for a while, there are some steps you should take ASAP to reduce the risk of fair housing trouble. If, for example, your policy still considers arrest records in criminal background screenings, you should make some changes immediately. HUD’s new guidelines flatly say that excluding someone based on arrest records is likely to have a discriminatory effect based on race and national origin.

Check whether your policy still lists “all felonies” or long-ago felonies as reasons not to rent to someone. If so, you may be headed for trouble because the guidelines call into question the lawfulness of excluding people based on criminal convictions without considering what the conviction was for or how long ago it occurred.

Taking it a step further, check whether your policy allows applicants to explain the background of a felony conviction. The HUD guidelines say that communities should offer applicants with criminal records an opportunity to explain the circumstances and what’s happened since then—something akin to the “interactive” process for disability-related reasonable accommodation requests.

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