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Can I Lose My Job If I File for Bankruptcy?

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Can I Lose My Job If I File for Bankruptcy?

man declares bankruptcy and loses job

Being in debt can feel like you are living in a black hole. Everything gets sucked in or is affected by it. One of the things you do not want to have disrupted is your job. It is one of the lifelines that is getting you out of this current situation. If you worry filing for bankruptcy will cost you your employment, speak with a bankruptcy professional to understand your rights.

Can I Lose My Current Job if I File for Bankruptcy?

Whether government or private, an employer cannot fire you for filing for bankruptcy. They also cannot change the terms of your employment by demoting you, reducing your salary or revising your job duties. If an employer releases you after learning you are going through bankruptcy (and for no other legitimate reason), they are committing bankruptcy discrimination.

Does My Current Employer Have to Find Out About My Bankruptcy Filing?

Employers rarely learn of Chapter 7 filings. All bankrutptcies, however, are a matter of public record. Sometimes we have to notify your employer of a bankruptcy filing such as when a creditor obtains a court ruling to have your wages garnished. Your attorney must notify the HR Department to stop this action.

Will Filing for Bankruptcy Affect My Current Job Security Clearance?

For jobs with security clearance issues, I generally advise my clients to speak to their superiors before filing a bankrutpcy. However, filing for bankruptcy can work in your favor. These organizations should prefer an employee or contractor take steps to deal with their financial issues. They see an individual struggling to cope with high debt as a risk for blackmail.

How Will Bankruptcy Affect My Future Job Searches?

Some laws restrict federal, state and local governments from using your bankruptcy filing as a reason for not hiring you. Unfortunately, private companies are not subject to these restrictions. If you are applying for jobs like bookkeeper, accountant or payroll manager, an employer may be concerned by your bankruptcy filing. Private companies sometimes do credit checks as part of their hiring procedures. These reports require your consent and will reveal your discharge. Refusal to allow the review can prompt a company to pass you over. The best course of action is to be upfront and honest about your bankruptcy filing. Discuss it with your potential employer. Let them see the positive steps you are taking to deal with your debt. You are proactively putting your life back on the right track. It shows you are a problem solver, which is generally something that can benefit their company.

Sawin & Shea – Indianapolis Bankruptcy Attorneys

If you are worried about how bankruptcy will affect your job, let the Indiana bankruptcy attorneys at Sawin & Shea outline your employment rights. With years of experience representing good people in bad financial situations, we can answer all your questions. Please do not hesitate to call us today at 317-759-1483 or send an email for a free consultation. We are ready to help.

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No upfront attorney fees in qualifying cases. Pay only court filing fee, credit reporting fee, and pre-bankruptcy credit counseling session fee to get a case on file to stop garnishments, repossessions, and certain court actions. Restrictions may apply. Please call to discuss your situation and learn how we can help.