Before an owner or operator decides whether to request a criminal background check on an applicant, s/he must determine the purpose served by the background check, whose background is to be investigated, and the standard to be applied when a criminal background is obtained. If the owner or operator adopts a policy of requesting a criminal background check, s/he uniformly must apply such policy and its standards to all applicants. Failure to do so will expose an owner or operator to claims of unlawful discrimination.

But even uniform application of such a policy does not guarantee owners and operators that their use of criminal background histories does not discriminate. Owners and operators violate the Fair Housing Act (FHA) when their policy or practice has an unjustified discriminatory effect, even when they had no intent to discriminate. The Department of Housing and Urban Development (HUD) explains that “[u]nder this standard, a facially neutral policy or practice that has a discriminatory effect violates the [Fair Housing] Act if it is not supported by a legally sufficient justification. Thus, where a policy or practice that restricts access to housing because of criminal history has a disparate impact on individuals of a particular race, national origin, or other protected class, such policy or practice is unlawful under the Fair Housing Act 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.”

In 2022, HUD’s Secretary for Fair Housing and Equal Opportunity released a memo titled “Implementation of the Office of General Counsel’s Guidance on the Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions. This memo reviews the principles of the Department’s Office of General Counsel’s 2016 Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions.

In the 2022 memo that has since been taken down,  HUD highlights the need for Fair Housing Enforcement Organization (FHEO’s) investigators, Fair Housing Initiative Program Grantees (FHIPs), and Fair Housing Assistance Program (FHAPs) to be aware of the ways in which criminal background screening policies and practices can violate the Fair Housing Act and provides tips for conducting investigations relating to criminal background screening and provides best practices for housing providers who may be concerned about potential liability relating to the use of criminal background screening information on applicants or tenants.

To refute a claim of discrimination based on a policy the relies on criminal histories in resident selection, an owner or operator must prove that the challenged policy or practice is justified – that is, that it is necessary to achieve a substantial, legitimate, nondiscriminatory interest. The owner or operator must understand that the interest s/he offers in his/her defense “may not be hypothetical or speculative, meaning the [owner or operator] must be able to provide evidence proving both that s/he has a substantial, legitimate, nondiscriminatory interest supporting the challenged policy and that the challenged policy actually achieves that interest.

“Although the specific interest(s) that underlie a criminal history policy or practice will no doubt vary from case to case,” HUD explains, “some landlords and property managers have asserted the protection of other residents and their property as the reason for such policies or practices. Resident safety and protecting property are often considered to be among the fundamental responsibilities of a[n] owner or operator, and courts may consider such interests to be both substantial and legitimate, assuming they are the actual reasons for the policy or practice. A[n] owner or operator must, however, be able to prove through reliable evidence that [his/her] policy or practice of making housing decisions based on criminal history actually assists in protecting resident safety and/or property. Bald assertions based on generalizations or stereotypes that an individual with an arrest or conviction record poses a greater risk than any individual without such a record are not sufficient to satisfy this burden.” (See Office of General Counsel Guidance on Application of Fair Housing Act Standards to the Use of Criminal Records by Providers of Housing and Real Estate-Related Transactions.)

Indiana law generally does not impose a duty on owners or operators to provide for their residents’ security and protection. Nevertheless, if owners or operators are basing a criminal history policy on the security and protection of their residents, it would seem likely that, at least to some extent, they voluntarily have assumed such a duty.

If owners or operators do not use criminal histories as a resident selection tool or they base their use of them on something other than resident security and protection, then in requesting criminal background checks, they should not give the impression that they are undertaken for the safety and security of residents. Rather, owners and operators should make clear that they undertake criminal background checks solely for their own benefit and protection.

If the purpose of the criminal background check is to keep those with criminal histories out of a community, then a check should be run on all adults living within an apartment and not merely those on the lease. If the purpose is to investigate the reliability of those obligated under the lease, the request may be limited to the person(s) signing the lease.

An owner or operator may establish any criteria for screening based upon criminal conduct, except that offenses related solely to the possession or use of alcohol or drugs, without more, may be better left off the list of crimes that result in exclusion. This is because if the applicant is in recovery, addiction to alcohol or drugs may constitute a disability under fair housing laws. An owner or operator otherwise may draw any line — from excluding only convicted traitors and murderers to excluding anyone who has ever been pulled over for a traffic offense. Again, owners and operators must apply these exclusions uniformly to all applicants.

Owners and operators must bear in mind that although criminal history is not a protected classification under the Fair Housing Act, a criminal history policy, when put into practice, may hit one or more protected classes (e.g., race or national origin) more heavily than it does others. If it does, owners and operators could be found liable for discrimination. Owners and operators should remain vigilant about the effects of their criminal history policies and whether those policies have a discriminatory effect on protected classes.

For HUD’s full discussion on this topic, see https://www.hud.gov/sites/documents/HUD_OGCGUIDAPPFHASTANDCR.PDF

Keywords: screening, felony, felonies, Sex Offender