Follow Five Rules to Prepare for Fair Housing Testers

The recent appointment of Carmelyn Malalis as the new chair of the NYC Commission on Human Rights (CHR) has coincided with renewed legislative interest in the Commission’s fair housing testing program. Commissioner Malalis recently testified in front of the City Council regarding Intro. 689, which would establish a testing program to root out housing discrimination in New York City.

According to the Commissioner’s testimony, in 2014, the Commission initiated 124 investigations into employment and housing discrimination, resulting in the filing of 125 Commission-initiated complaints (some of the cases filed in 2014 were investigated in 2013). The Commission’s testers were involved in all 125 situations leading up to a Commission-initiated complaint, indicating the effectiveness of the testing program in identifying violations of the law. Commission testers referred incidents of actual or perceived discrimination to the Law Enforcement Bureau, which then initiated investigations and filed complaints.

Currently, the Commission’s testing program is staffed by two full-time staff and six part-time staff who identify possible violations of the NYC Human Rights Law and then may go out into the field as testers to determine if owners and agents are in fact violating the law. A January 2015 grant of funds from the Department of Housing Preservation and Development will support the Commission’s testing work until June 2015, and has enabled the Commission to deploy testers in even more situations.

Exploration of ways to expand the Commission’s testing program in target and scope is already underway, said Malalis. She mentioned the possibility of reaching out to community partners of the Commission and a diversity of legal tenant advocates to help the CHR strategically pinpoint appropriate targets and collaborating with such groups to further diversify the CHR’s pool of testers addressing the Human Rights Law’s different protections.

In the last decade, the Commission’s testing program has focused primarily on discrimination based on lawful source of income or family status in housing. And, according to Malalis, matters involving discrimination based on race, sexual orientation, gender identity and gender expression, religion, arrest or conviction record, and other bases covered by the Human Rights Law would also benefit from the Commission’s testing program.

Now more than ever, it’s important to do everything you can to ensure your building complies with fair housing law—that way, you’ll be likely to pass any fair housing test. Fair housing testing has moved beyond site visits by paired testers—individuals with similar credentials but different races—to compare how they were treated. Fair housing testing has also expanded to include newer, cheaper tools—namely, the telephone, and more recently, the Internet—to check for discriminatory advertisements, statements, or treatment of individuals or groups based on their names, the way they speak, or whether they have children.

Since it’s unlikely that you’ll know when an email, phone call, or a visit from a prospect is really from a fair housing tester, your best bet is to treat everyone contacting your building as if he was a fair housing tester.

We’ll explain how fair housing testing works—and suggest five rules to avoid problems if your site is ever subjected to fair housing testing.

Fair Housing Testing and Antidiscrimination Laws

The Fair Housing Act (FHA) prohibits discrimination in housing because of race, color, religion, sex, national origin, familial status, or disability. In addition, the CHR is charged with the enforcement of the Human Rights Law, Title 8 of the Administrative Code of the City of New York, one of the most comprehensive civil rights laws in the nation. The law prohibits discrimination in housing based on race, color, creed, age, national origin, alienage or citizenship status, gender (including gender identity and sexual harassment), sexual orientation, disability, marital status, and partnership status. In addition, the law affords additional protections based on lawful occupation, family status, and any lawful source of income. The City Human Rights Law also prohibits retaliation and bias-related harassment.

Not only are there fair housing testers at the city level, federally the Justice Department has its own fair housing testing program to identify and challenge cases involving a pattern or practice of housing discrimination. According to the department, the vast majority of lawsuits filed based on testing evidence involve allegations that individuals misrepresented the availability of rental units or offered different terms and conditions based on race, national origin, disability, or family status.

For example, in April 2012, the owner of a New York building agreed to pay $175,000 to settle a race discrimination case based on testing conducted by a private fair housing organization at the request of the Justice Department. As part of the settlement, the owner admitted that its former on-site manager told African-American prospects that certain apartments were not available while telling non-African Americans that such apartments were in fact available, and quoting higher rent prices to African-American prospects. The settlement requires the owner to pay a $25,000 civil penalty and $150,000 into a victim fund to compensate persons who were harmed by its discriminatory practices [U.S. v. Burgundy Gardens, LLC, April 2012].

Fair housing testing may be triggered by a variety of circumstances. In complaint-based testing, it’s used to verify whether an individual who claims a particular building discriminated against him based on his race, national origin, or other characteristic, has a legitimate complaint. If the fair housing organization conducts site visits, it will send individuals whose backgrounds—credit, rental, or employment history—are similar, but differ based on the protected characteristic at issue. If the results of testing support the individual’s claim, then the evidence gathered may be used in court or enforcement proceedings.

Sometimes, the trigger isn’t a complaint, but suspicions about discriminatory policies or practices at a particular building. In its broadest form, “systemic” testing is used to gauge whether discrimination based on a particular characteristic is a problem in buildings within a geographical area. It could involve site visits to check for various forms of discrimination or telephone tests aimed at linguistic profiling—treating prospects differently because of assumptions about their race or national origin based on the way they speak.  

Rule #1: Treat All Prospects as if They’re Fair Housing Testers

On any given day, you’re likely to have many interactions with prospective residents, including phone calls, email inquiries, Internet communications, or visits to your building. They may be inquiries about advertised vacancies or the availability of certain types of apartments.

You may never know when one of these encounters is part of a fair housing test because enforcement agencies and fair housing organizations generally exercise caution in selecting and training fair housing testers.

In any given geographical area, local fair housing organizations may maintain a pool of trained fair housing testers who are called upon infrequently to preserve their anonymity.

So even if you have an inkling that a particular prospect is a tester—because of the type of questions being asked, the way he carries himself, or the timing of similar contacts—you really can’t be sure if a given encounter is part of a fair housing test. Testers posing as prospects may call your office or visit the building to check for differences in treatment based on race, national origin, disability, familial status—or other characteristics protected under the city’s Human Rights Law.

Don’t forget about fair housing concerns when responding to emails or online inquiries on your website. Your best bet is to treat everyone contacting or visiting your building as if he were part of a fair housing test. Keep personal biases out of the leasing office and treat all prospects with professionalism and courtesy, starting with the initial contact—whether online, on the phone, or visits to your property.

Rule #2: Incorporate Fair Housing into Your Building’s SOP

Make compliance with fair housing an integral part of your building’s standard operating procedures (SOP). No doubt, you have numerous policies, practices, and procedures governing the marketing, leasing, maintenance, and other critical operations within your building. Many are based on business decisions, while others reflect legal requirements, such as landlord-tenant laws, health and safety codes, and other regulatory obligations.

Incorporating fair housing requirements serves both—it’s not only a legal requirement, but it’s a good business decision. Making your building available to any prospect who meets objective criteria to rent meets your legal obligations under fair housing laws. And, by distinguishing your reputation as an equal housing provider, you’ll lower the risk of being targeted for fair housing testing based on suspicions about discriminatory policies or practices.

Maintain a formal written fair housing policy, affirmatively stating that your building does not discriminate on the basis of race, color, creed, age, national origin, alienage or citizenship status, gender (including gender identity and sexual harassment), sexual orientation, disability, marital status, and partnership status. Include it in your rental applications and leasing agreements, and post it in your office, alongside the fair housing poster required under HUD regulations.  

Pay particular attention to your advertising and marketing policies. Make sure your website, ads, brochures, and other media—whether in print or online—reflect your fair housing policy. Use of questionable phrases or buzzwords that suggest a preference against people with children or disabilities, for example, is likely to draw the attention of fair housing enforcement or advocacy agencies, which could lead them to target your building for fair housing testing.

Rule #3: Ensure Consistency in the Leasing Office

Put in place standard, nondiscriminatory rental policies to ensure that prospects are treated fairly and consistently from the moment they contact your leasing office.

Testing is often focused on differences in the information provided to prospects about the availability of units, so it’s important to ensure that leasing agents have accurate, up-to-date information about vacancies. If, for example, you tell a couple without children about a vacant unit a short time after telling a single mother of a young child that nothing is available, it may appear that your building is discriminating against families with children. If these prospects are testers, they may get the wrong impression about why you told the first prospect that an advertised unit wasn’t available, since it’s impossible for them to know whether it’s because of blatant discrimination, sloppy record keeping, or simply that a vacancy just opened up.

Similarly, make sure prospects receive the same information about the terms and conditions of tenancy, such as screening criteria, rental terms, security deposits and fees, and any other relevant information. Quoting more stringent lease terms or higher rental payments to prospects based on a violation is a violation of fair housing law.

Testers also may be looking for signs of unlawful steering—that is, guiding, directing, or encouraging prospects from living in your building or certain parts of the building based on a protected characteristic. For example, it’s a violation of fair housing law to tell Hispanic prospects that they wouldn’t be happy living in your building—or showing them only units in undesirable locations. Even if based on well-intentioned concerns about convenience or safety, failure to disclose vacancies in upper-level floors to a prospect who has a disability or families with young children could be considered unlawful steering. Whatever your personal opinions about which units are best suited to a particular prospect, tell him about all available units that meet his needs and offer to show him as many as he wishes to see.

Rule #4: Provide Fair Housing Training to All Employees

All your employees, from your leasing staff to service workers in your maintenance, housekeeping, and landscaping operations, should receive periodic fair housing training. Although most testing efforts are addressed to your leasing office, interactions with any employee who interacts with the public could lead to a discrimination complaint, which in turn could trigger a fair housing test.

The training should cover the fundamentals of fair housing, including who is protected under federal law as well as any applicable state and local laws. It should also explain your building’s policies and what employees can and can’t do under fair housing law. Reinforce the importance of keeping personal biases out of the workplace and to treat everyone with courtesy and professionalism. Make sure employees understand the chain of command so they know where to go for help or to report any fair housing concerns or observations.

Don’t allow new employees to interact with the public without at least a basic understanding of fair housing law. Otherwise, they may inadvertently make well-intentioned, but inappropriate comments when answering the phone or meeting prospects. For example, an inexperienced employee could be overly curious about the nature of a prospect’s disability or cultural differences reflected in the prospect’s accent or appearance—just the type of conduct that could draw the attention of fair housing testers.

Managers should monitor how the leasing staff, particularly new employees, interact with prospects on the phone, in site visits, and in Internet communications. Consider an open-door policy for management staff, so managers can hear what’s going on in the office—and encourage them to periodically sit in on phone calls or meetings with prospects and to tag along on tours.

Managers must be trainers to reinforce good habits in employees, so good management means checking up from time to time on sales presentations, tours, applications, and so on, to see what staff members are doing. And it’s a good idea to have all employees sign an acknowledgement saying that they agree to abide by fair housing laws and that they understand that they may be monitored and recorded for training and compliance purposes.

Rule #5: Shop Your Property

Shopping yourself—either by internal means or by hiring an outside shopping service—is one of the best ways to ensure that you won’t be caught off-guard from the results of a fair housing test. It’s an effective tool to monitor whether your employees are complying with fair housing laws and to identify any weaknesses—either in an employee’s performance or in the effectiveness of your training program.

You can do it informally, by asking people you know to pose as rental prospects, but many owners hire outside shopping services to call or visit the leasing office to monitor sales and marketing as well as fair housing issues.

Whatever means you use, it’s important to follow up to determine the root cause of any deficiencies detected during the “shop.” There could be a number of reasons why a shopping service might report that a leasing consultant responded inappropriately to a shopper’s question. If it’s because the employee truly acted improperly, you should respond with disciplinary action. If the employee simply misunderstood fair housing requirements, you’ll know that the employee needs additional training.

Alternatively, the results of a shopping test may reveal a larger problem—for example, that your policy or training on a particular issue is unclear or incorrect. If that’s the case, you’ll have an opportunity to rectify the problem on your own, rather than having to address it after the fact if it surfaces for the first time during a fair housing test.