How Often Can I Declare Bankruptcy?
If you have filed for bankruptcy before and received a discharge of debt, you need to wait before you can file for bankruptcy again. The federal bankruptcy code specifies when…
Bankruptcy is a difficult decision, made even more difficult by the social stigma associated with filing. You worry that others will find out and judge you for filing. With bankruptcy rates on the rise, this issue is on the minds of more and more people as mounting debts lead them to consider bankruptcy. Whether you are considering Chapter 7 filing, discharging all debts, or Chapter 13 bankruptcy, paying back the majority of your debts over time, you will undoubtedly have questions and concerns, including how the bankruptcy might impact your job.
What Your Employer May Know
Your first question upon deciding to file for bankruptcy may be, “Will my employer know I’ve filed for bankruptcy?” This question comes from simple embarrassment and fear that you might lose your job. The answer, however, is a bit complicated. The bad news is that your employer can learn about your bankruptcy, particularly if:
- You owe your employer money
- You have wage garnishments in effect
- You file a Chapter 13 bankruptcy
No matter which form of bankruptcy you file, if you have wage garnishments, those will be automatically stopped. Therefore, it is common for employers to learn of bankruptcy when it stops a wage garnishment, in which case your employer will receive a notification.
If you file for Chapter 13 bankruptcy, it is possible that you will be required to have the payments to your creditors automatically deducted from your paycheck, alerting your employer to your bankruptcy. However, this will depend on your individual circumstances and where you file.
Bankruptcy Protections
The good news is that you will not lose your job as a direct result of bankruptcy. Even if your employer does learn of your bankruptcy, the law prevents your employer from firing you or making other changes to your employment as a result of bankruptcy. This protection makes it illegal to fire you, lower your pay, reduce your hours, or take any other negative action as a result of the bankruptcy. However, filing for bankruptcy will not protect you from being fired for poor performance, even if it occurs around the same time.
Your bankruptcy filing also cannot be considered when you apply for a government job, though private companies can choose to consider your credit history as a condition of employment. This means that, if you are applying for any level of government employment, your bankruptcy will not be an issue that prevents you from being hired. If you are applying for a non-government job which requires a credit check, you should know that the potential employer will be aware of your bankruptcy. This knowledge could lead them to choose a different candidate, particularly if the job requires any handling of money.
Contact an Attorney
As you begin considering bankruptcy, contact the attorneys at Bankruptcy Law Center right away. Our experienced bankruptcy attorneys can help you to explore all of your options and minimize the potential negative effects. If you have already filed and been wrongfully terminated as a result, an experienced bankruptcy attorney can help.
