Will Bankruptcy Impact Your Job?
Can you be fired if you file for bankruptcy? If you are seeking work, can a potential employer refuse to hire you because you’ve filed for bankruptcy? Relax. In most situations, filing for bankruptcy will have no effect on your current job. No employer in either the public or private sector may fire you – or discriminate in any other way – because you’ve filed for bankruptcy. Before you file in Illinois, be sure to discuss any concerns with an experienced Chicago bankruptcy lawyer.
Employers rarely know about Chapter 7 bankruptcies. However, if a creditor has garnished your wages, the bankruptcy will end the wage garnishment, and your employer will be notified. Frankly, many employers are happy to see their employees deal responsibly with personal financial issues. If you file for Chapter 13 bankruptcy, your employer will probably find out. A bankruptcy judge may order your bankruptcy payments automatically deducted from your wages, so in effect, your employer will be your collection agent.
If your job requires a security clearance, bankruptcy may actually help you, since people in financial trouble are sometimes subject to blackmail, and bankruptcy is a step aimed at ending financial trouble. If you are seeking employment, no federal, state, or local government agency may take your bankruptcy into account when making a hiring decision. However, you may have trouble obtaining a job in the private sector where you deal directly with money as a bank teller, bookkeeper, or accountant. Employers who conduct credit checks prior to hiring will discover your bankruptcy, so the best thing to do is to be candid and honest. Take responsibility. Explain precisely why you filed for bankruptcy and what you’ve done to meet your financial responsibilities. Most employers will appreciate that.
Still, if you are denied benefits or a promotion by your current employer, if you are wrongfully terminated, or if you have other questions or about how a bankruptcy may affect your work in the Chicago area, speak at once with an experienced Chicago bankruptcy lawyer.
