Personal Bankruptcy – Can Filing For Bankruptcy Affect Your Job?
If you’re in debt and thinking about ways to end your bill problems, you’re worried about your privacy. Who will find out about your issues, and what kind of effect it will have on your major barriers to getting out of debt.
After all, this is a personal issue – not something you want to discuss with the world.
Under normal circumstances, your employer won’t find out that you’ve filed for Chapter 7 or Chapter 13. The exceptions to this rule are:
Your payroll department may be notified to discontinue an income execution (wage garnishee).
If you file a Chapter 13 bankruptcy and your court requires Plan payments to be made through wage deduction then your payroll department will need to know who to send the payments to.
The chances are slim that your employer will take the time to go down to the courthouse and enter your name, social security number and other identifiers in order to find out whether you’ve filed a case. It’s possible, but think about it – how likely is it that anyone has that kind of time on their hands?
If your employer finds out about your case, can you be fired? Generally, no.
In New York an employer can hire and fire employees at their whim and employees may quit at any time. That’s called “at will employment,” and it’s the general way of doing business nationwide.
Section 525(b) of the U.S. Bankruptcy Code protects you from being fired due to filing for bankruptcy. This section states that no “private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has” filed solely on the basis of having filed for bankruptcy.
In other words, you can’t be fired solely because you filed for relief from your bill problems. Of course, your boss could fire you for other reasons. So if your job performance isn’t up to snuff, you can’t hide behind the U.S. Bankruptcy Code for protection.
As a practical matter, some employers may actually be happy when you use the law to get out from under your bill problems. Once you file a case you’re less likely to be distracted by money worries. You’re less likely to “dip into the till” to cover your expenses. You won’t get those annoying phone calls at work anymore. Payroll won’t need to deal with income executions served by angry creditors.
Now that I’ve answered your question, I’d like to invite you to visit http://www.NewYorkBankruptcyHelp.com to get my free report and learn more about your options for getting out of debt.
Jay S. Fleischman is a New York bankruptcy lawyer and New York State co-chairman for the National Association of Consumer Bankruptcy Attorneys. He is also the co-founder and past President of the Bankruptcy Law Network, where he writes on consumer bankruptcy and related issues.
Article Source: Personal Bankruptcy – Can Filing For Bankruptcy Affect Your Job?
