Do Employers Find Out about Filing Chapter 7 Bankruptcy

The decision to file for Chapter 7 bankruptcy is never easy. It often brings about a multitude of questions and concerns, one of the most common being: “Will my employer find out about my bankruptcy?” At Liviakis Law Firm, we understand the concerns that come with this decision, and we’re here to provide clarity on the subject.

Firstly, it’s essential to note that under the U.S Bankruptcy Code, employers cannot discriminate against current or prospective employees based on bankruptcy status. This means that an employer cannot fire, demote, or refuse to hire someone because they have filed for bankruptcy. However, it doesn’t mean that they won’t find out about it.

Many people worry about their employer discovering their bankruptcy filing, fearing job security or reputation damage. However, in most cases, an employer will not be notified of a personal bankruptcy filing. Bankruptcy filings are public records, but they are not typically something an employer would stumble upon unless they are specifically looking for it.

There might be certain situations, however, where an employer could be notified. If you owe your employer money and they are a creditor in your bankruptcy case, they will be notified. Also, if your wages are being garnished for a debt, your employer would be notified to stop wage garnishment as the debt would be included in the bankruptcy.

It’s also important to mention that if you’re applying for a job in certain industries such as financial services or roles that require a security clearance, you may be required to disclose your bankruptcy. The employer may perform a credit check as part of the hiring process and discover the bankruptcy filing that way.

While the idea of an employer discovering your bankruptcy can be unnerving, it’s crucial to remember that bankruptcy is a legal tool designed to provide relief to those in financial distress. It’s not a sign of personal failure or irresponsibility. Filing for bankruptcy demonstrates that you’re taking steps to handle your financial situation.

In conclusion, while it is possible for your employer to find out about your bankruptcy filing, it is not likely unless there are specific circumstances involved. If you’re considering filing for chapter 7 bankruptcy in Sacramento, CA and are concerned about the potential impact on your employment, we recommend speaking with a knowledgeable attorney at Liviakis Law Firm. You can reach us at 916 459 2364. We are ready to help you navigate your way to financial freedom.