For many people, a career is a major priority. Even for those who don’t love their jobs, the thought of not advancing is very distressing. Everyone wants to succeed at work even if only to maximize their earning potential. So many worry that when they file for bankruptcy it will disrupt their career advancement or worse, stop it in its tracks.
How Does Filing for Bankruptcy Affect Potential Career Advancement?
Does filing for bankruptcy decrease your chances of getting hired if you are in the process of seeking a new place of employment? Will filing for bankruptcy decrease your chances of being picked for a coveted promotion? In truth, the answer will vary depending on your situation, the company policy where you work or hope to work, and the industry that you work in.
For most people, the filer’s ability to appropriately handle their finances and their current financial status is more likely to have an effect on their employment or career advancement. When people are distressed about their financial situation, they are more likely to lose focus at work, be prone to depression, and exhibit careless behavior and errors on the job. In fact, in many cases of financial distress, filing bankruptcy can have a notable positive impact on an individual’s work performance and therefore be a good move for their overall career success.
This is a topic that has come up in previous columns. It’s a common concern. As discussed previously, the bankruptcy code actually addresses current and prospective employment discrimination due to bankruptcy. Employers are actually prohibited from denying employment based on a bankruptcy filing – with the highest burden placed on government agencies. Private employers are not held to the same rigid standards and may, in fact, deny employment based on an applicant’s bankruptcy filing.
If you are worried about your bankruptcy filing negatively affecting your career, take action to prevent any workplace consequences. Address the issue with your current employer or prospective employer. Disclose the bankruptcy before he or she discovers it on their own. Some companies include a background check for employees and prospective employees, which includes a credit check. Addressing the issue directly gives you the chance to explain yourself, provide your reason for filing, and disarm them simply by humanizing the situation. When the bankruptcy eventually pops up in the background check, they aren’t surprised and your straightforward honesty leaves them trusting you rather than dismissing your candidacy for the job or the promotion simply because of the stigma of bankruptcy.
These tips are not based on any official statistical information, but solely on past experience and testimonials from previous clients. The issue of bankruptcy will not appear as a positive during a background check for employment or advancement, but handled correctly, many have found that it doesn’t have to hold them back either. If you have questions about the effects of filing for bankruptcy, please get in touch with one of the experienced southern California bankruptcy attorneys at Westgate Law.