New HUD Final Rule Updates Fair Housing Act
10/17/2016 3:00:41 PM

By Lisa Vercauteren, Vice President of Housing Programs

Title VIII of the Civil Rights Act of 1968, as amended in 1988, is better known as the Fair Housing Act. This law guaranteed that all Americans, regardless of race, color, religion, sex, handicap, familial status, or national origin, have the right to equal opportunity in the purchase or rental of housing. The Act is pretty clear on what type of practices are allowed and which are prohibited. However, as with any rule, regulation, or law, there is always room for interpretation.

HUD has been charged with the authority to interpret and enforce the Act. But over the years, several challenges have come before the Federal Court of Appeals and, more recently, before the Supreme Court. These higher-court decisions help to further define the standards used by HUD and our judicial system.

For example, it has been widely accepted by the courts that discrimination does not have to be intentional to violate the Fair Housing Act. A seemingly benign business practice that has an unjustified discriminatory effect is no less a violation of the Act than a blatant act of discrimination. But how do you show whether a business practice is justified or not?

In 2013, HUD issued a final rule that updated the Fair Housing Act to include a three-part burden-shifting test to provide uniformity in how these decisions were made. Last year, the Supreme Court chose to hear a disparate impact case and, through its ruling, upheld the lower court's opinion that discrimination does not have to be intentional. It further defined the burden a defendant must meet to defend a justifiable business practice.

HUD's latest clarification of unacceptable behavior under the Fair Housing Act was published last month and became effective last Friday, Oct. 14, 2016. HUD's Final Rule, entitled Quid Pro Quo and Hostile Environment Harassment and Liability for Discriminatory Practices Under the Fair Housing Act, adds a new subpart to the Fair Housing Act that provides standard definitions and examples of two specific types of harassment that were more commonly acknowledged in civil rights protections for employees. In this final rule, HUD acknowledges that "one's home is a place of privacy, security, and refuge (or should be), and harassment that occurs in or around one's home can be far more intrusive, violative, and threatening than harassment in the more public environment of one's workplace."

This final rule can be found at https://www.gpo.gov/fdsys/pkg/FR-2016-09-14/pdf/2016-21868.pdf

Quid Pro Quo Harassment is defined as subjecting a person to an unwelcome request or demand and making submission to the request or demand a condition related to the person's housing. Quid Pro Quo literally means "this for that."

HUD defines Hostile Environment Harassment as subjecting a person to unwelcome conduct that is sufficiently severe or pervasive such that it interferes with or deprives the person of the right to use and enjoy the housing.

When determining whether a hostile environment exists, HUD looks at the totality of the circumstances, including but not limited to the nature of the conduct; the context in which the incident(s) occurred; the severity, scope, frequency, duration, and location of the conduct; and the relationships of the persons involved. Harassment does not have to include physical conduct; it could also include written or verbal conduct. In addition, HUD clarifies that a single incident can meet the definition of harassment if it is sufficiently severe. Like HUD's burden-shifting test, this clarification provides a standard on which to judge the validity of Fair Housing harassment complaints.

This final rule also establishes direct and vicarious liability for all types of discriminatory housing practices. HUD confirms that a housing provider is not only responsible for his/her own discriminatory conduct, but also for the conduct of an employee or agent regardless of whether the provider was aware of the conduct.

In addition, the provider can also be liable for the conduct of a third party, such as a resident, if the housing provider does not take action to correct the behavior when the behavior is known and the provider has the power to correct it.

As a practical matter, this means that now more than ever, it is vital that housing providers ensure that all employees and vendors are aware of the protections provided by the Fair Housing Act and our duty to take prompt action to correct and end a discriminatory housing practice regardless of whether it is committed by a person under our control or not.

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