Can My Job Fire Me if I Submit Bankruptcy?

Can My Job Fire Me if I Submit Bankruptcy?


For lots of people, declaring bankruptcy is not a pleasurable or happy experience. For numerous Alabama filers, it may be a time loaded with shame and even pity. So it’s understandable that if you’re considering stating bankruptcy, you have problems regarding what individuals could assume.

One of your most important concerns might concern exactly how your employer will certainly watch your bankruptcy if they learn about it. Can they discharge you since you’ve applied for bankruptcy? If not, can they take various other biased conduct versus you?

The solution to both these concerns is that it depends. A number of variables influence what lawful defenses you have throughout bankruptcy, including what type of company you’re benefiting. A lot of these defenses will originate from Section 525 of the U.S. Bankruptcy Code.

If You Already Have a Job

If you’re working for a government or private company, you can’t be discharged because you:

  • Applied for bankruptcy.
  • Did not pay a financial debt that was discharged (or will be discharged) in bankruptcy.
  • Were bankrupt before obtaining your financial debts discharged in bankruptcy.
  • Have a spouse that declared bankruptcy.

Your employer likewise can’t victimize you for any of the above listed factors. Points are a little bit different if you’re looking for a job, nonetheless.

What About an Employer Refusing to Hire Me Because of My Bankruptcy?

If you’re getting a government job, your possible company can’t decline to hire you on the basis that you (or specific person associated with you) filed for bankruptcy, did not pay a financial debt that was released in bankruptcy or were financially troubled prior to having your financial obligations released in bankruptcy.

Nevertheless, if you’re getting a task with a private company, they may use your bankruptcy history to refuse to employ you. Depending on the task, it’s common for employers to perform credit history checks of applicants. When they do this research study on you, your bankruptcy will certainly turn up.

Employment At-Will: There’s the Law as well as There’s What People Do

If you’ve currently got a job, you can really feel relatively secure in keeping that work if you file bankruptcy. Yet if you’re like the majority of employees in Alabama, you are used “at will.”

At-will employment indicates you or your company can end the employment partnership any time as well as for any type of factor (or no reason at all). There are exemptions to this rule, and among those exceptions may restrict your Alabama employer from shooting you since you applied for bankruptcy.

Also if Alabama courts would certainly prevent an employer from firing an employee for a background with bankruptcy, the trouble is that unless your employer informs you this is why they’re shooting you, it will certainly be extremely difficult to show you were fired for an illegal factor. Keep in mind, at-will work implies you can obtain fired for no reason at all. Or your company can lie about why they’re firing you.

Are You Facing Bankruptcy Discrimination?

If you feel your company has actually discriminated against you since you submitted Chapter 7 or Chapter 13 bankruptcy, you might have legal choices readily available. To learn what these are, you are required to consult with a neighborhood bankruptcy lawyer in Birmingham or any place you are living to appropriately review your certain monetary scenario and also determine the most effective means to continue.


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