Will My Employer Know If I File For Bankruptcy?
Although there is absolutely no shame or embarrassment in filing for bankruptcy, it is understandable that you may not want others to know you are doing it. Certainly some people–like close family–may be aware, but one person or entity that you may want to keep your bankruptcy from is your employer. Will your employer know if you filed for bankruptcy?
When Will an Employer Know About a Bankruptcy?
Technically, bankruptcy filings are public records, and anybody who searches federal court records and who bothers to rummage through the filings, will eventually come upon your filing. Most employers do not do this–unless they conduct background or credit checks, in which case, the service that they use to do those checks could reveal the existence of the bankruptcy.
If your boss is a creditor–like if you owe the boss, personally, or your own company, money–they would certainly know, because like any creditor, they would be notified of your bankruptcy.
If you have a wage garnishment in place, your employer will be notified of the bankruptcy–but the good news there is that the notification would be to stop the garnishment.
Sometimes, if you file for a Chapter 13 bankruptcy, your Chapter 13 payments are taken directly out of your paycheck, which would tell your employer that the deductions are a result of a bankruptcy. Sometimes, this can be an easier way to pay your Chapter 13 payments without you having to worry about missing a payment.
You Don’t Have to Tell – And You Can’t be Punished
But beyond those scenarios, there is no obligation for you to ever tell your employer you filed for bankruptcy. You don’t have to tell your current employer, and you don’t have to tell any prospective, future employers that you’ve filed for bankruptcy.
And even if your boss did find out that you filed for bankruptcy, there is little they could do about it, as it is illegal to fire (or take any negative employment action) against someone for the mere fact that they filed for bankruptcy. It is illegal both for people who work for private companies and government employers.
Employers not only can’t fire you for filing for bankruptcy, they can’t demote you, treat you differently than other employers, give you a poor job performance review, refuse to give you a raise because of your bankruptcy, or do anything considered negative at work.
Probably Not a Big Deal
In the end, most companies don’t care if you file for bankruptcy, or if you have in the past. Larger companies will have loads of employees with bankruptcies in their past, and smaller companies that know you may not care–they care more about your job performance than the fact you are being responsible by taking control of your financial future with a bankruptcy.
We can answer all your bankruptcy related questions, and help you figure out the best way to get your finances in order. Contact the Boca Raton bankruptcy attorneys at the Law Offices of Stephen Orchard at 561-455-7961 today.