Although some Realtors feared an avalanche of ethics complaints after the National Association of Realtors approved a new policy against hate speech in November, those fears appear to not have materialized thus far.
The changes, which became effective immediately on Nov. 13 and are not retroactive, apply NAR’s Code of Ethics and Standards of Practice to all of a Realtor’s activities, not just those related to real estate; prohibit hate and harassing speech against protected classes; prohibit all discrimination, not just willful discrimination, against protected classes; and recommend that ethics violations be considered under membership qualification criteria.
One of the policies that was approved, Standard of Practice 10-5, reads as follows: “Realtors must not use harassing speech, hate speech, epithets, or slurs based on race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.”
Ethics complaints are generally handled by local or state Realtor associations and therefore NAR does not have a national picture of how many 10-5 complaints have been filed, NAR staff told attendees at the fifth of six monthly training webinars the 1.4 million-member trade group is hosting in the wake of the ethics changes.
“We’re aware across the country … there have been cases filed,” NAR staffer Diane Mosley told attendees. “We haven’t seen a deluge of those and I’ll leave it at that.”
In an emailed statement, NAR spokesperson Wes Shaw told Inman NAR does not formally track the number of ethics complaints filed at Realtor associations. NAR declined to comment on how many complaints it is aware have been filed under the November changes, their outcomes so far, whether the complaints involve posts on social media and which protected classes have been at issue.
“We have been made aware of a few situations anecdotally, but those processes remain confidential,” Shaw said.
During the webinar, NAR staff and Professional Standards Committee members stressed that Realtor ethics complaints and their outcomes are required to remain confidential under NAR rules.
More to come in May
It’s possible that more complaints haven’t been filed because Realtors are not quite sure how to apply the ethics changes yet. During the webinar, for instance, one attendee asked who hate speech should be reported to: the agent’s local association or NAR? The local association, NAR staffer Kate Lawton said.
NAR is currently in the process of adding November’s ethics changes to its online ethics training and that will be finalized within the next 4-6 weeks, according to Shaw.
Many members are eager to see the case interpretations NAR has promised to help ethics hearing panels apply 10-5 and evaluate complaints. Thus far, NAR has been hesitant to respond to member questions about specific circumstances that may or may not violate the new policies, such as whether using the term “white privilege” or displaying a bumper sticker with the Confederate flag could be considered hate speech.
“NAR cannot definitively state what would or would not be violations of Article 10 as interpreted by Standard of Practice 10-5, as that is the privilege and responsibility of hearing panels at local associations sitting in review of an ethics complaint,” NAR spokesperson Mantill Williams told Inman in November.
“The only exception would be that from time to time, the NAR Professional Standards Committee approves Case Interpretations that offer specific factual circumstances and then a determination of whether the conduct was or was not a violation of the Code of Ethics.”
The trade group anticipates that its Professional Standards Committee will consider case interpretations in May, which, if approved by the committee, will take effect immediately and do not need approval from the NAR board of directors.
The association does not yet know how many case interpretations will be voted on initially because the committee’s Interpretations and Procedures Advisory Board has not finalized the cases that will be presented to the full committee, Shaw said.
NAR does not yet know whether other ethics changes will come up for a vote by the NAR board of directors at the trade group’s midyear conference in May, the Realtors Legislative Meetings, according to Shaw.
“[T]he Committee’s agenda is undetermined at this time and the Interpretations and Procedures Advisory Board has not yet finalized their recommendations to the full Committee,” he said.
A complaint filed in New York
One webinar attendee, Lance Evans, executive officer of both the Jefferson-Lewis Board of Realtors and the St. Lawrence County Board of Realtors in New York, said he had recently received his first 10-5 complaint.
Reached via email afterwards, Evans declined to provide specifics on the complaint itself, such as whether it involved a social media post or which protected class was at issue, due to confidentiality.
“The complaint was filed last week and does allege a violation of Standard of Practice 10-5,” Evans told Inman. “The grievance committee has not met yet on the complaint.”
During the webinar Evans asked whether the local association should provide its grievance committee with Appendix XII of the Code of Ethics and Arbitration Manual when it is deliberating on a 10-5 case — an idea NAR staff supported. The appendix was added in November to provide guidance on the interpretation of the new policies.
“While it is written more toward hearing panels, because the Standard is only a few months old, I feel it will assist the Grievance Committee also,” Evans said. “It provides good guidance, especially since this is a new SOP and there has not been a body of experience built up for this.”
Overall, Evans said he felt NAR had provided associations with a lot of resources for working through such complaints, including Tuesday’s webinar.
“All of the webinars are archived online and the NAR staff is very responsive when we reach out,” he said.
Violating the public trust
NAR declined to comment on whether any of the complaints so far have involved violation of the public trust, the subject of Tuesday’s webinar.
One of the changes in November requires member associations “to share with the state real estate licensing authority final ethics decisions holding Realtors in violation of the Code of Ethics in instances involving real estate-related activities and transactions where there is reason to believe the public trust may have been violated.”
While a change in November stipulated that NAR’s Code of Ethics applies to all of a Realtor’s activities, not just those related to real estate, the requirement to report to a state licensing authority is limited to violations of the public trust.
Also in November, the definition of “public trust” was expanded to include all discrimination, not just willful discrimination, against the protected classes under Article 10 of the Code of Ethics, and all fraud, not just fraud resulting in substantial economic harm.
The removal of “willful” made the definition of public trust consistent with Article 10 of the code, which prohibits denying equal professional services to anyone in the above-mentioned protected classes and does not say that discrimination must be willful, according to Leigh York, 2020 chair of the NAR Professional Standards Committee’s Interpretation and Procedures Advisory Board.
“But also if you think about that a little further, you know, if I’m out in the parking lot and you run over me with your pickup and it was an accident, I’m not any less hurt by that just because it was an accident, right?” she said.
“So ‘willful’ just didn’t really seem appropriate.”
An association’s board of directors decides whether there’s an obligation to forward a particular ethics violation to the state licensing authority, according to Mosley. Associations may, but are not required to, refer violations of the public trust to other government agencies such as the U.S. Department of Housing and Urban Development, York said.