Will You Lose Your Job if You File for Bankruptcy?

Can you get fired for filing personal bankruptcy in Utah?

If you file for Utah Chapter 7 bankruptcy, it’s possible that your employer may never find out.

Bankruptcies are matters of public record, but few people – other than court clerks and bankruptcy attorneys – actually access the system to view the filings. However, there’s always a chance your boss could be the exception to the rule.

With a Chapter 13 case, the situation is a bit different. The judge in unusual cases might order that your plan payments be automatically deducted from your paychecks. If that happens, your employer will know you have filed a bankruptcy claim.

Fortunately, whether you file for Chapter 7 or Chapter 13, you’ll be able to keep your current job – even if your boss learns about your claim.

You Can’t Be Fired Because of the Bankruptcy Filing

Are you a government employee, or do you work in the private sector? Regardless, your employer is not legally allowed to terminate your employment on the sole basis of your bankruptcy filing.

However, if your boss has other valid reasons to fire you – such as attendance issues, poor performance, or insubordination – filing for bankruptcy won’t offer extra job protection. Like anyone else, you could be let go for other reasons.

Your Employer Can’t Treat You Differently After Bankruptcy

Are you in line for a raise or promotion? Does your job require a security clearance or professional license? Filing for bankruptcy won’t affect any of that.

Your employer can’t legally change the conditions of your employment just because of your bankruptcy filing.  Treating you differently is a violation of the law. You can’t be demoted, and your boss can’t point to the bankruptcy as grounds for taking away responsibilities or cutting your salary. Except for rare exceptions, your security clearances and professional licenses are also protected.

Your Bankruptcy Filing Could Affect Your Search for a New Job

Are you planning on looking for a new place of employment? If you’re interested in working for a federal, state or local government agency, filing for bankruptcy won’t present a problem – it’s not a factor that can be legally considered during the hiring process.

Private employers aren’t bound by the same rule. A bankruptcy filing could affect your ability to land a new job in the financial sector or one that involves dealing with money. That said, speaking candidly when you’re being interviewed can be enough to outweigh any negative views others may have about your bankruptcy.

If you have questions or concerns about filing for bankruptcy, the Law Office of Davis & Jones, P.C., is here to provide expert answers and advice.

Our highly skilled legal team has a combined 40 years of experience in bankruptcy law.  We can help you down the road to a better financial future. We offer free consultations to residents of the Salt Lake City metropolitan area, the Wasatch Front and the surrounding Utah communities. To speak with a seasoned Utah bankruptcy attorney, contact our office today.