Bankruptcy and Employment

Will Bankruptcy Effect My Employment?

A common question asked by our clients who are contemplating filing bankruptcy is whether or not doing so will affect their employment.

The Answer

According to 11 U.S. Code § 525, neither a government or private employer “may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt, solely because such debtor or bankrupt.”

So, it is clear that your employer may not fire you or discriminate against you in any way just because you filed bankruptcy. When asked this question, we assure our clients that federal law protects them from being let go from and otherwise penalized on their job solely because they filed bankruptcy.

Employment & Bankruptcy?

Most of our clients are satisfied that they are protected from discrimination by their employer, but some question whether or not their employer even has to know about them filing bankruptcy. There is no law that says you directly have to inform your employer that you have filed bankruptcy. However, it is possible that your employer may find out in some other way. The most likely way your employer could find out is if you file Chapter 13 bankruptcy and have your bankruptcy payments deducted from your check. Another way your employer may learn is if they receive notification to stop a current garnishment of your wages because you have filed bankruptcy.

For Help With This or Any Other Matter

The attorneys at the Bond & Botes Law Offices have devoted decades to helping people resolve debt and move forward into a more stable financial futures. We offer free consultations to people facing overwhelming and unpayable medical expenses. You can schedule yours right now by calling 1-877-581-3396 or by filling out the contact form on this page.