If you’re considering filing for bankruptcy, the last thing you want it to do is to affect your job – or your ability to find a job – either now or in the future. The good news is that it likely won’t affect your employability more than a poor credit score – which you likely already have if you’re mired in debt.
In fact, you have more employment protections than if you have significant outstanding debt on your credit record. Under federal law, employers cannot make hiring or other decisions based on a person’s history of bankruptcy.
Poor credit can limit your job prospects
If you’re in a line of work where you have access to cash or other valuables or where you could be susceptible to bribery or blackmail, potential employers may run a credit check. Some employers also do credit checks when they promote employees to positions with more responsibility or authority.
For example, people who regularly work around large amounts of cash or other valuables like jewelry often must pass background checks, which include looking at their credit. Obviously, employers can’t risk having employees who are in financial peril and could be tempted to steal.
Law enforcement officers’ credit histories are also relevant. Besides sometimes being around vast sums of money, drugs, weapons and other items that could be sold for a great deal of money, they are common targets of attempted bribery.
In professions where a security clearance is required, often because of access to highly confidential information, employers can’t afford to have employees who could potentially find a bribe impossible to turn down. Obviously, most people who are in debt aren’t willing to steal or sell confidential information to make that debt go away. However, that’s the reason for looking at potential employees’ personal financial situation.
Putting a positive spin on your bankruptcy
Employers can’t run a credit check on someone without their consent. Therefore, if a credit check is necessary to get a job, it’s usually best to get out ahead of what an employer will find. Explain briefly why there’s a bankruptcy on your record, why you chose that route and how you’ve gotten your finances back on track. Then turn the focus back to what you have to bring to the job.
Having experienced legal guidance can help you handle your bankruptcy wisely and get control over your financial life.