You may be trying to get hired on with a different company, or maybe you’re looking for an entire career change altogether, and now you’re wondering if filing for bankruptcy will affect your job search. While the Bankruptcy Code section 525 (b) explicitly protects individuals from being fired for no other reason than their bankruptcy, less protection is given to people applying for a new job. If you are seeking government positions then you are entirely protected from being discriminated based on your bankruptcy, but if you are seeking private employment or a position with a high security clearance then it’s possible that you will be asked for permission to have a background check performed. A credit report is a common component of a background check and it will list your recent bankruptcy.
But here’s the thing. Bad credit is more prevalent than most people realize, and employers typically only use bankruptcy as a hiring factor when the job is in the financial field, or otherwise requires the applicant to have sensitive duties in regards to money. But even still, according to the Society for Human Resource Management’s (SHRM) 2012 nationwide survey, among organizations that require credit reports a whopping 80% have hired an applicant despite having bad credit. In fact according to this study more than half, 53%, of employers do not require credit checks at all and this figure is actually up 13% from 40% in 2010. So basically, half of employers do not require credit checks, and of the half of employers that do require credit checks 4/5 of them have reported hiring someone with bad credit anyway.
Bankruptcy is becoming less and less of an issue for prospective employers and according to the largest society of human resource professionals you now have a good chance of not being required to provide a credit report at all. The truth is that most employers have seen employees in financial distress in the past, and many have faced significant financial hardships in their own businesses.
Your bankruptcy will certainly feel like a big deal to you, but will be less of an issue for a future employer in most cases. According to the SHRM survey, employers today are viewing credit checks with lower importance when compared to other job skills, job experience or generally being the right person for the job. Many employers see a candidate who has had a recent bankruptcy as actually being more responsible than a candidate who is in a terrible financial situation and has yet to do anything about it.
At the end of the day, you will know if your prospective employer is about to perform a credit check because you will need to give them your permission to do so. If they are asking for a credit report then consider this a good sign that you are in the running for the job, this usually means that you are very close indeed.
If you are concerned about how your bankruptcy may affect your chance at a great job, then speak to a qualified bankruptcy attorney. In our office in New York we are happy to help prepare our clients for their job interview and can help you develop candid responses to an interviewer’s questions about your bankruptcy. Remember, many people have faced financial hardship through no fault of their own, and most employers will see your seeking a fresh financial start as the step in the right direction.
If you live in New York, and have questions about Bankruptcy and how it could affect future employment please give the Law Office of William Waldner a call at 212-244-2882 to arrange a free bankruptcy consultation today. We offer free consultations and will help prepare you for difficult interview questions in the unlikely event you will face them. Our firm has a 100% bankruptcy discharge record and we are committed to excellent client communication and helping people find the fresh financial start they deserve.
This article is intended for educational purposes only.
By reading this article no attorney-client relationship has been created.