New HUD guidance on criminal records puts landlords in a bind
Therefore, if landlords refuse to rent to people who have been arrested or convicted, and this policy unintentionally ends up discriminating against a protected class of people, the policy is unlawful “if it is not necessary to serve a substantial, legitimate, nondiscriminatory interest of the housing provider, or if such interest could be served by another practice that has a less discriminatory effect,” HUD said.
What’s not clear is how landlords should treat potential renters with criminal convictions. The guidance does not prohibit them from asking about conviction records but says that “arbitrary and overbroad criminal history-related bans” will probably run afoul of HUD’s interpretation of the act.
It describes a three-step process for how disparate-impact cases would proceed under the act. First, the plaintiff must prove that a housing provider’s criminal history policy has a discriminatory effect on a group of people because of race or national origin.
Under step two, the burden shifts to the housing provider to prove that its policy “is necessary to achieve a substantial, legitimate, nondiscriminatory interest of the provider.” A policy of rejecting all applicants with convictions “will be unable to meet this burden,” it says.
A housing provider with a more tailored policy that excludes individuals with certain types of convictions “must show that its policy accurately distinguishes between criminal conduct that indicates a demonstrable risk to resident safety and/or property and criminal conduct that does not.” HUD gives no examples as to what types of criminal conduct, such as murder or grand theft, could be excluded under this policy.
However, the act does not prohibit discrimination (intentional or not) against a person who has been convicted of making or distributing illegal drugs defined in the Controlled Substances Act.