• Home
  • Blog
  • Bankruptcy
  • A Bankruptcy Lawyer in Philadelphia Outlines the Intersection of Bankruptcy and Employment

A Bankruptcy Lawyer in Philadelphia Outlines the Intersection of Bankruptcy and Employment

The United States, for the most part, is an “at will” country, meaning that employment is “at will.” Employees are free to quit and employers are free to fire at any time. Keeping this in mind, there are a few exceptions; for example, you cannot get fired based on your race, sex, age, disability or a few other “protected classes.” Each state, including Pennsylvania, can expand on these protected classes.

In the event you file for bankruptcy, could you be fired?

Generally, your employer would need to take significant steps to discover your bankruptcy, unless you filed under Chapter 13 and agreed to have your wages attached for your monthly payments.

In the event your employer terminates your position based on other reasons; for example, you lost focus at work due to your bankruptcy worries, then that may be justified. In that case, your employer would also need some other valid justification such as tardiness, dishonesty or incompetence. You may wonder, how would your employer find out about your bankruptcy?

A bankruptcy lawyer in Philadelphia will inform you there are two methods an individual may file for bankruptcy: Chapter 7 and Chapter 13.A bankruptcy lawyer can help answer questions about employment and bankruptcy

Chapter 7 bankruptcies are rarely discovered by an employer. One possible way an employer may find out is if a creditor obtains a judgment against you and sends notice to your employer to find out if you are employed. The bankruptcy would shield you from the creditors collection efforts but your employer would still find out. Regardless, Chapter 7 does not often affect your employment.

Chapter 13 is a longer and more expensive case and will likely require that you make Chapter 13 payments every month.  In some cases, these payments are required to come directly from your paycheck. In this case, payment would be automatically deducted from your wages. Essentially, the court presses your employer into an informal collections agency to ensure that you comply with the Chapter 13 payment plan.

Can an employer take bankruptcy into consideration when hiring you? In the event you are applying for a government position (federal, state or local), the hiring department is prohibited from considering your bankruptcy. As for private employers, there is no corresponding rule, therefore employers may take bankruptcy into consideration.

A good attorney can show you how to rebuild your credit score after the bankruptcy is over. A bankruptcy case does not ruin your credit forever.

Need a bankruptcy lawyer in Philadelphia? Alfred Abel Law Offices can answer any questions you may have, and can provide expert legal representation for bankruptcy, accidents, injuries, business law, and more. Call today!