15 Tips: Will Bankruptcy Affect My Job
15 Tips: Will Bankruptcy Affect My Job
If you are planning to file for bankruptcy, you may find yourself being worried about the effect it could have on your employment. As is covered in detail over at runrex.com, many people in such a situation begin wondering if their current or future employer will discover a bankrupt filing and whether that could impact their ability to keep their job or obtain work. This article will look to answer such questions and worries through the following 15 tips.
- Will you lose your job due to filing for bankruptcy?
This is usually the first question people ask when considering filing for bankruptcy. According to discussions on the same over at guttulus.com, no employer, private or government, can fire you solely because you filed for bankruptcy. This means that your bankruptcy shouldn’t affect your current employment.
- Can your employer change the terms of your employment?
No, your employer can’t use a bankruptcy filing as a reason to change other terms or conditions of your employment. As per the gurus over at runrex.com, some of the terms and conditions that your employer can’t change include your salary where your employee can’t reduce your salary, nor can they demote you or take away some of your responsibilities.
How your employer can find out about your bankruptcy
While employers very rarely find out about a Chapter 7 bankruptcy filing, it can still happen, and the next few tips will look to highlight how.
- Stopping a wage garnishment
From discussions on the same over at guttulus.com, if you have a wage garnishment and you file for bankruptcy, your employer will find out. This is because they must receive notice of the bankruptcy to stop the garnishment.
- You owe your employer money
Remember, as outlined over at runrex.com, when you fill out your bankruptcy paperwork, you must list all of your debts. This means that if you owe your employer money, like say, you are paying back a payroll overpayment, you will have to include it, which means that your employer will get notified about your bankruptcy case.
- Making Chapter 13 payments
Although not in all jurisdictions, in some, if you file for Chapter 13 bankruptcy, your employer is likely to learn of your bankruptcy case. This is because the bankruptcy judge may order your Chapter 13 payments to be automatically deducted from your wages and sent to the bankruptcy court, which will mean that your employer will become like a collection agency to make sure that you honor your Chapter 13 plan.
These are some of the ways through which your employer may find out about your bankruptcy case.
- Will you risk losing your security clearance if you file for bankruptcy?
As discussed over at guttulus.com, many jobs require a security clearance, including if you are a member of the armed forces, an employee of the CIA, FBI, or any other government agency, or work in a private company that contracts with the government. If you are wondering if you risk losing your security clearance if you file for bankruptcy, then the answer is probably not. The opposite could be true, given that a person with financial problems, particularly one with a lot of debt, is at high risk of being blackmailed. This means that, by filing for bankruptcy, getting rid of your debt, you will be lowering your risk significantly.
- How will bankruptcy affect your chances when applying for a job in a federal, state, or local government agency?
As is outlined in discussions on the same over at runrex.com, no federal, state, or local government agency can consider your bankruptcy when deciding whether or not to hire you. This means that bankruptcy should affect your job application chances.
- What about when it comes to private employers?
While federal, state, or local government agencies can’t consider bankruptcy when deciding whether to hire you, private employers are not constrained by a similar rule according to the folks over at guttulus.com. This is why some people find that having a bankruptcy in their past can come back to haunt them.
- How do prospective private employers find out about your bankruptcy?
Remember, as the subject matter experts over at runrex.com are quick to point out, many private employers conduct a credit check on job applications, and since your bankruptcy can stay on there for up to 10 years, the employer will find out about your bankruptcy from your credit report.
- Who is most affected when looking for employment in the private sector having filed for bankruptcy?
You might be wondering why a bankruptcy case should cause a problem for your prospective private employer. In most cases, bankruptcy causes problems for those applying for jobs that require them to deal with money such as bookkeeping, accounting, and so forth.
- Will filing for bankruptcy jeopardize my professional licenses?
If you are licensed in more than one state to perform your duties as a doctor, lawyer, cosmetologist, pharmacist, and so forth, you may be worried that filing for bankruptcy may jeopardize your professional licenses. As covered over at guttulus.com, the same section of the bankruptcy code that protects you from being fired also protects you from discrimination when you apply for your license. You cannot be denied a professional license solely because you filed for bankruptcy.
- Are there professions where filing for bankruptcy may affect your work?
According to the gurus over at runrex.com, certain professions have professional conduct standards requiring one to disclose if they have filed for bankruptcy. Most of the time these are professions involving management of money and trust accounts like an insurance/investment broker, accountant, or lawyer. In such situations, your professional designation may be affected, or the type of work you can do may be limited until after the bankruptcy is discharged.
- The nature of your debt
Generally speaking, if the debts you owe are personal and are not as a result of fraudulent or irresponsible business activity, then filing for bankruptcy shouldn’t impact you professionally. However, as outlined over at guttulus.com, if your debt was as a result of fraudulent financial or business behavior, then your employer may have grounds to fire you.
- You may not be able to get bonded
According to the gurus over at runrex.com, if you handle money for clients as a part of your employment, then your job may require what is known as a fidelity bond. Fidelity bonds protect your employer from a loss for their clients as a result of an employee’s behavior. If you are an undischarged bankrupt, it may be hard for you to get bonded, and if you are unable to get bonded, an employer may choose not to hire you for these types of positions.
- Other types of positions you may be prevented from holding
Additionally, if you are undischarged bankrupt, you can also be prevented from holding certain positions and roles in the company. These include the director of an incorporated company, a credit union, a condo corporation, or a co-operative.
This discussion only begins to scratch the surface as far as this topic is concerned, and you can uncover more by checking out the excellent runrex.com and guttulus.com.