Legalities of Refusing to Rent to Coworker

[Carrie Gulledge]

My husband and I manage the rental houses for my father-in-laws rental company.  We recently had a rental house become vacant and a coworker of my husband's overheard him discussing it.  This is a coworker that my husband does not have a good relationship with; he is also my husband's superior in the National Guard.  We do not want to rent to him and have always had a pretty firm"don't rent to coworkers" stand.  However, the coworker approached my husband today about renting the house from him and when my husband reiterated that we don't rent to coworkers, he went and complained to their boss.  Their boss pretty much told him he didn't want to hear about it.  The last time this happened with the same coworker but a different rental property, he threatened to file against us for discrimination.  We know that this coworker has not paid his current rent regularly, and they had their home foreclosed on last year.  Do we have to go through the rental application process with him or can we be safe legally in saying that we don't rent to coworkers?