Have you been considering the pros and cons of filing for bankruptcy and been concerned that one of the major cons might be its effect on your ability to get a job – or even a new position with your current employer – in the future?
You may know that a Chapter 7 bankruptcy will remain on your credit record for ten years and Chapter 13 bankruptcy will generally be on there for seven years. Some employers do run credit checks on applicants before making them a job offer. Some also do that before promoting employees to more senior positions.
So will bankruptcy prevent you from getting a job? In most cases, it shouldn’t. The Equal Employment Opportunity Commission (EEOC) prohibits employment decisions (including hiring, firing and promotion) based on whether they have a bankruptcy on their record.
In some occupations, a person’s credit is relevant
In some occupations, however, a person’s credit record is considered relevant to their work, and it’s not illegal to consider whether someone’s credit record is good or poor. Likely, a person who has recently filed for bankruptcy doesn’t have a stellar credit record, but the employer is going to see that poor credit whether they filed for bankruptcy or not.
Among the kinds of jobs where employers look for good credit are the following:
- Any job where someone has access to cash or other valuables
- Law enforcement jobs (where they have access to valuable confiscated items)
- Jobs where a security clearance is required (and you could be subject to bribes)
The good news is that a bankruptcy on your record is actually better than just poor credit. A bankruptcy shows that you’ve handled your financial problems responsibly and are on track to a better future — so that makes you less vulnerable to financial temptations. That could even make your poor credit a non-issue.
Explaining your bankruptcy
The good news is that employers must get your consent to run a credit check. If they ask permission, it’s often best to tell them upfront about your bankruptcy. Briefly mention what happened (like a job loss, divorce or family illness) and focus on the fact that bankruptcy was the best option for turning things around. Re-emphasize your job experience and skills.
If you’re considering filing for bankruptcy, it’s wise to have experienced legal guidance. This can help you get through it successfully and move forward with your life.