Unemployment and Bankruptcy
Unemployment and BankruptcyDealing with a job search is bad enough without having to worry about money being tight or debts going unpaid. But unfortunately, financial problems are often a part of unemployment. For many, unemployment causes a financial situation bad enough to lead to bankruptcy. What should you know when it comes to unemployment and bankruptcy?
Looking for a Job after Filing for Bankruptcy
Your job search might be one of the most stressful times in your life. Job hunting and all that goes with it is challenging for even the most motivated and accomplished person. If you’re struggling financially, the process becomes downright miserable.
The good news is you aren’t alone.
Many people in the job market are also in the middle of filing for bankruptcy. Job loss is one of the most common reasons people file for bankruptcy. So in most cases, no, bankruptcy will not affect your ability to find work. If your employer even finds out you filed, they are unlikely to hold it against you if it doesn’t interfere with your ability to do your job.
In some cases, employers are legally restricted from holding bankruptcy against you.
According to the Bankruptcy Code, federal employers cannot deny you a job based on bankruptcy. If you have a job and you file, no employer can terminate you for filing. You can learn about the protections available to employees here.
Sometimes Bankruptcy Does Affect the Hiring Process
But are there situations in which filing for bankruptcy can affect your ability to find work?
Maybe. Some employers run credit checks on potential employees and if they see you’ve recently filed for bankruptcy, it could lead to questions. It all depends on whether or not financial problems and bankruptcy could affect your work.
Most commonly, you run into problems with credit if you are looking for a job in the financial sector. Anytime you are handling money or sensitive financial information, a potential employer is likely to run a credit check. And if that check turns up a bankruptcy, you could be viewed as a financial risk.
Just because you have filed for bankruptcy or you are having a tough go of it financially doesn’t mean you’re a risk or that you’ll behave unethically. Some employers even view bankruptcy as a good thing when it comes to reducing their risk. This is because once you’ve filed, you are no longer dodging creditors and you’ve been granted protection by the bankruptcy court. This makes you less likely than someone who is still under pressure to do anything unscrupulous to deal with your financial challenges.
Honesty is Always the Best Policy When It Comes to Unemployment and Bankruptcy
Keep in mind, employers cannot run credit checks without your written permission. You’ll always know if they are going to see your credit or not, so you can plan to share information about your financial situation. Many employers appreciate employees being upfront and are more likely to overlook financial problems if you are candid with them.
The important thing is to not let unemployment or your job hunt deter you from getting your financial situation back on track.
If you’d like more information or you have questions about filing for bankruptcy when you are unemployed, contact R. Flay Cabiness, II, P.C. at (912) 554-3774 (Brunswick, GA); (912) 375-5620 (Hazlehurst, GA) or; (912) 554-3756 (Jesup, GA) to schedule a consultation.
