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Will filing bankruptcy get me fired?

On Behalf of | Jun 20, 2017 | Bankruptcy, Bankruptcy |

Employers are prohibited by federal law from discriminating against you for filing for bankruptcy protection. However, that may not end your concerns about your employer’s reaction to the news.

Here are two things you need to consider:

1. Bankruptcy is a matter of public record — but that doesn’t necessarily mean your boss will ever know.

Bankruptcy notices are published in the paper in order to give your creditors a chance to protest or claim some of your assets. However, unless you live in a very small area or are a public figure, gone are the days when personal bankruptcies made the regular newspaper. Most bankruptcies are now announced in a special newspaper that exists just for the purpose of publishing legally required announcements.

The odds are slim that your employer will find out about the bankruptcy through that source unless he or she regularly reads that publication for some reason. Just the same, if your employer does find out through office gossip or some other method, he or she may feel that you were purposefully hiding the information — and that could damage your relationship further than any financial issues you have.

2. Your employer may already know you are in financial trouble.

There are few people who make it all the way to the stage where they’re filing bankruptcy without some indication of their financial stress reaching the attention of their supervisor or boss.

Aggressive debt collectors routinely try to harass debtors at work — whether it’s a violation of the law or not. Some debt collectors have absolutely no problem letting someone’s boss know about the issues. Plus, if your wages are being garnished because of debt, your employer definitely already knows.

It may be a relief to your employer to know that you are filing bankruptcy. Your employer has less reason to worry that you might be tempted to bribery, theft or some other form of graft in order to solve your financial troubles, and filing bankruptcy is an adult, proactive way of dealing with your debt.

You ultimately have to decide if you’re going to avoid the issue or openly address it with your employer. If your employer wants to fire you over it, he or she may find an excuse — but that opens up the possibility of a discrimination lawsuit.

An attorney can answer questions or address other concerns you may have about bankruptcy.

Source:, “11 U.S. Code 525 Protection against discriminatory treatment,” accessed June 16, 2017


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