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Will Filing for Bankruptcy Affect My Job?

Filing for bankruptcy is a very personal choice. It is not an easy decision to make as it can affect almost every facet of your life. It can be considered bittersweet; you get the chance to start over debt-free, but it comes at the cost of losing some of your personal possessions. Of the personal things you lose, could one of them be your job? This blog will break down if and how filing for bankruptcy can affect your job.

Current Job

You are not legally obligated to disclose filing for Chapter 7 or Chapter 13 bankruptcy to your current employer. Like most personal matters, it is allowed to stay private and out of the workplace. It is illegal for any employer to fire you for filing for bankruptcy, even if the government employs you. Your employer also has no jurisdiction to change the terms or conditions of your employment due to filing for bankruptcy.

There are some situations where your employer may become aware of your bankruptcy status, but you are still protected from your employment being terminated. One situation in which your employer may become privy to your bankruptcy status is if your wages were previously being garnished, and now they no longer need to be. Having your wages garnished means your employer is legally obligated to hold your wages so they can be used to help pay off a debt such as child support.

Future Employability

Employer discrimination law protects debt status, meaning you cannot lose your current job for your bankruptcy status. Yet, suppose you apply for a job in the private sector. In that case, your employer can ask for your credit history when applying for a new position if you deny your credit history in the background check or have a history of bad credit and bankruptcy that can work against you in acquiring a new job. It is a very rare occasion that this will stand in your way unless it directly affects the work you are being hired for.

If you have questions about your rights and bankruptcy contact RHM LAW LLP at (213) 344-0043!