Bankruptcy Discrimination

By: Timothy McFarlin | Published: May 15th, 2010 | Category: Bankruptcy

When a person files for bankruptcy, the matter becomes one of public record. This means that a search of public records for a person’s name will reveal personal financial details related to a bankruptcy case. This fact is one of concern for many employees and potential employees who fear their personal financial history may deny them career opportunities.

Federal bankruptcy laws offer clear direction for preventing bankruptcy discrimination, but the law takes two different directions for federal employers and private employers. Federal bankruptcy laws prevent federal employers from denying employment to, terminating employment of, or generally discriminating against (for the purposes of employment) those who have filed for bankruptcy. In regards to private employers, federal bankruptcy laws only prevent discrimination against those who are already employed, not those seeking employment. The main difference between the section that discusses private employment and federal employment is the fact that only the federal government is prevented from denying employment to those who have filed for bankruptcy. Private employers, on the other hand, are free to discriminate against those who have filed for bankruptcy before the individual becomes an employee, or in simple terms, they are free to discriminate against job applicants who have filed for bankruptcy. If a private employer conducts a background investigation of an applicant’s financial history and discovers a bankruptcy, the employer may deny employment to the applicant. It is important for those considering bankruptcy to consider their current employment situation and how a bankruptcy will affect them. Individuals with dreams of entering the federal workforce or advancing in the federal workforce need not worry about discrimination. Individuals who are considering bankruptcy but are currently unemployed are advised to secure employment as quickly as possible so that they will not fall victim to legal bankruptcy discrimination by private employers. Individuals who are considering bankruptcy who are currently employed do not have to worry about being fired or discriminated against by their current employer because federal bankruptcy laws make it illegal to do so.

It is important to remember that the above examination of federal bankruptcy laws only applies to the laws enacted by the federal government. Depending on the state and jurisdiction that a person is employed in, different laws may also prevent bankruptcy discrimination where federal law fails to. If a person is concerned about how a bankruptcy will affect their ability to get or hold a job, the person should consult with a trained and experienced bankruptcy attorney in their area who can offer further guidance and advice based on the laws of the jurisdiction that the individual is employed in.

Employees and job applicants who feel that they have been illegally discriminated against because of a bankruptcy in their financial history should also contact an experienced bankruptcy attorney for guidance on how to pursue legal action against an employer for their actions. It is recommended that individuals seek the advice of an attorney because an attorney can offer an impartial review of any facts and claims of a case. Even though a person has a bankruptcy in their past, a bankruptcy may not be the reason for termination, denial of employment, or discrimination, but it may be perceived as such by the employee.

Post Tags:

Share This Page


Ask Our Lawyers a Question







Use of this form for communication with our office does not establish an attorney-client relationship, confidential information should not be sent through this form.