Bankruptcy Discrimination Attorney

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Bankruptcy Discrimination in the Workplace

Dedicated Employment Discrimination Attorneys Helping Clients Fight for Their Rights Under from Bankruptcy Discrimination in the Workplace

Sometimes filing bankruptcy is necessary to help alleviate financial strain. Filing for bankruptcy is filled with stress. You should not need to worry whether you will lose your job as a result of filing. The Bankruptcy Act prohibits employers from taking negative actions against you for filing for bankruptcy.

For over 25 years, the dedicated employment discrimination lawyers at the Derek Smith Law Group in New York City, Philadelphia, Miami, Los Angeles, and New Jersey have helped victims of bankruptcy discrimination get the compensation they deserve.

Complete a Free Case Evaluation form or call (800) 807-2209 today.

What Is Discrimination Based on Bankruptcy?

Bankruptcy discrimination occurs when an employer, CEO, supervisor/manager, coworker, client/customer, or nonemployee discriminates against or harasses an employee or job applicant because he or she filed for bankruptcy. In some states, an employer may view and make decisions based on the results of a credit report. However, they may not make decisions based solely on whether an employee filed for bankruptcy.

You may not be fired, terminated, or refused a job because you filed bankruptcy or are associated with someone who is a debtor in a bankruptcy petition.

You are also protected from bankruptcy discrimination in the workplace if you are associated with a debtor in bankruptcy. For instance, your child may have filed bankruptcy. Your employer may not take negative action against you as a result.

Bankruptcy discrimination in the workplace includes:

  • Firing an employer who filed for bankruptcy
  • Refusing to hire a job applicant who filed for bankruptcy
  • Making jokes about a coworker’s financial situation
  • Calling an employee broke or a mooch because he filed bankruptcy
  • Demoting an employee because she filed bankruptcy
  • Changing the job responsibilities for a bankruptcy debtor’s job to make sure she never handles any money

What Law Protects Employees from Bankruptcy Discrimination in the Workplace?

The Bankruptcy Act includes a section that addresses employee rights explicitly. Section 525 is Bankruptcy Protection Against Discriminatory Treatment. The law states employers may not take adverse actions against employees or job seekers who are debtors or associates of debtors who:

  • Are involved in a bankruptcy proceeding
  • Are insolvent before the start of a proceeding or its discharge
  • Has left a debt that is dischargeable in bankruptcy unpaid

New York City has a specific law prohibiting most employers from even learning about bankruptcies during a pre-employee background screening. Under the New York City Human Rights Law Credit Check Law, employers with four or more employees may not check your credit for creditworthiness, bankruptcies, or judgments and liens unless you are applying for one of the following types of employment:

  • Police or peace officers
  • Executive-level positions having control over finances, computer security, or trade secrets for a company

Non-executive positions are not exempt from the law, including bank tellers, cashiers, and other positions handling money.

Is an Employee or Job Applicant Required to Disclose a Bankruptcy to an Employer?

Bankruptcy, like many financial issues, is a very private matter. In most cases, you are not required to tell your employer you have filed or will be filing for bankruptcy. However, if your paycheck is garnished for any reason, you will need to inform your employer or payroll department about the bankruptcy filing.

If your employer lets you know a credit check will be part of your hiring process, you may wish to disclose the bankruptcy to avoid any surprises. It is optional to reveal your bankruptcy; however, doing so cannot be held against you.

Can an Employer Deny a Job Based on Bankruptcy?

The law is very clear. An employer cannot refuse to hire you simply because you filed for bankruptcy. However, if your employer is permitted to check your credit report, they may deny you a job based on other credit issues, judgments, or liens if they were not dischargeable in bankruptcy.

Can an Employee Be Fired for Filing Bankruptcy?

An employee cannot be fired for filing a bankruptcy petition. In most circumstances, employees do not need to inform employers of pending bankruptcy proceedings or post-bankruptcy results. However, if you confide in your employer or have to tell him due to wage garnishments, no negative actions can be taken. If you are fired as a result, you may have a claim for wrongful termination.

Can a Person Obtain a Job After Filing Chapter 7 Bankruptcy?

Filing bankruptcy cannot prevent you from obtaining gainful employment. You do not need to disclose your bankruptcy filing to a potential employer for any reason. However, if your employer learns of the bankruptcy, they cannot refuse to hire you as a result.

What Are the Rights of Victims of Bankruptcy Discrimination in the Workplace?

The Equal Employment Opportunity Commission (EEOC) receives all employment discrimination charges, including bankruptcy discrimination charges. Victims of bankruptcy discrimination can file a charge with the EEOC within 300 days of the discrimination or harassment.

The EEOC will investigate the allegations and issue a Right to Sue letter within 180 days of receiving the charge. The Right to Sue letter allows you to file your discrimination complaint in federal court.

What Remedies Are Available for Victims of Bankruptcy Discrimination in the Workplace?

If you are successful in your bankruptcy discrimination claim, you may be entitled to the following remedies:

  • Reinstatement of employment
  • Lost wages
  • Attorney’s fees and costs
  • Pain and suffering
  • Emotional distress
  • Punitive damages

Contact Our Experienced Bankruptcy Discrimination Attorneys for Your Free Consultation.

You should never worry about maintaining employment if you have to file for bankruptcy. If you are the victim of bankruptcy discrimination in the workplace, the dedicated lawyers at the Derek Smith Law Group can help. For over 25 years, the dedicated employment discrimination lawyers at the Derek Smith Law Group in New York City, Philadelphia, Miami, Los Angeles, and New Jersey.

Contact us today at (800) 807-2209 for your free consultation. We do not collect any fees until you win your case.

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With over 25 years of experience, we have represented thousands of employment discrimination victims. We have recovered millions for our clients, including the largest emotional distress jury verdict in an employment law case ever to be sustained on appeal!

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