You might be hesitant to file for bankruptcy because you’re afraid you might lose your job. Maybe you’re concerned that a potential employer will deny your employment if you filed for Chapter 7 or Chapter 13 bankruptcy. If you can’t meet your financial demands with a job, how would you meet them without one?
Will Bankruptcy Affect My Current Job?
It’s safe to say you won’t lose your job solely due to filing for bankruptcy. No employer — government or private — can use your filing for bankruptcy as a reason to change the terms or conditions of your employment. This means they can’t use it to demote you, reduce your salary, take away responsibilities, or fire you.
Keep in mind that other valid reasons exist for firing you, such as incompetence, dishonesty, tardiness, etc. Your filing for bankruptcy won’t hide or protect you from those reasons. But if none of those exist and you are fired shortly after filing for bankruptcy, you might have a case against the employer for illegal bankruptcy discrimination.
In most cases, especially with Chapter 7 bankruptcy, your employer will not find out about your filing. But if a creditor has sued you, obtained a judgment, and began garnishing your wages, then your employer will be made aware. This is because, to stop the garnishment, your employer must know about your bankruptcy.
In some cases, under Chapter 13 bankruptcy your employer will know of your filing. If you have a regular job with a regular income, the judge may order your payments to be automatically deducted from your wages. In this instance, your employer serves as almost a collection agency, making sure you honor your Chapter 13 plan.
Will Bankruptcy Affect My Future Employment?
When it comes to applying for jobs and potential employment, no federal, state, or local government agency can consider your bankruptcy when deciding to hire you. Only private employers retain the power to do so.
Jobs that require you to deal with money (accounting, payroll, etc.) tend to be warier about hiring those who have filed for bankruptcy. It’s also important to note that those private employers tend to do credit checks on job applicants and filing for bankruptcy would appear on your credit report.
Schedule Your Free Consultation with an Experienced Bankruptcy Attorney
If you’re thinking about filing for bankruptcy and you’re worried about what it could mean for your future, then you should contact an experienced lawyer. Joel R. Spivack is an experienced bankruptcy lawyer in New Jersey that is ready to get you back on the right financial path.
Call 856-488-1200 or Contact Us Online to Get Started
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney/client relationship. If you are seeking legal advice, please contact our law firm directly.