Can Filing For Bankruptcy Impact My Employment?

March 4th, 2020
Posted By
Michael Ryan Jones
man with hands on back of neck and head down on desk
Filing for bankruptcy can be incredibly stressful. You may worry people will find out and think of you differently. And then there is the added stress of your employer finding out. But can filing for bankruptcy impact your employment in Ohio?

Will Filing For Bankruptcy impact my current job?

In most cases, bankruptcy will not impact your current job. That being said, though an employer cannot fire you because you filed for bankruptcy, if they have other reasons to fire you from your position, bankruptcy cannot be a legal defense to stop that from happening. Typically your employer will not even find out about your filing if it is Chapter 7 unless you have been sued by a creditor, that was causing wage garnishments. Chapter 7 bankruptcy will stop wage garnishments, which is when your employer will learn of your bankruptcy. If you have filed for Chapter 13 bankruptcy, your employer is more likely to know about the case as your bankruptcy payments will be deducted from your wages. In order for that to happen, your employer will receive an order from the bankruptcy judge to withhold those payments.

I’m looking for a new job. Can Filing for Bankruptcy limit my options?

Yes and no. While no local, state or federal government agency can use your bankruptcy against you, a private employer can. Under the Bankruptcy Act, a private employer can’t discriminate against your employment because of bankruptcy. But case law tends to go in the opposite ruling, specifically after the case, Rea v. Federated Investors, 627 F.3d 937 (3d Cir. 2010). This is especially the case in the private sector when it comes to finance-based jobs. Private employers will often conduct background checks and upon finding out about your bankruptcy, decide they may or may not want to hire you. Typically, it should not impact future employment, but you’ll want to disclose your bankruptcy before a background check is run.

The bottom line: Do what is best for you.

You may be fearful of filing for bankruptcy but you have to do what is best for you and your family. Ultimately, there should not be employment backlash when it comes to your bankruptcy filing, but it’s important to know all of your options.

Don’t Let Fear Stop You From a Fresh Financial Future.

If you have concerns about your employment or future employment potential because of a bankruptcy filing, you need to contact a trusted bankruptcy attorney. Don’t delay and contact The Jones Law Firm for a free consultation. With offices in Reynoldsburg, Ohio, The Jones Law Firm works with clients in and around Columbus and throughout central Ohio. Don’t delay. Your financial future begins now.
Categories: Chapter 13 Bankruptcy, Chapter 7 Bankruptcy