Will My Employer Find Out That I File for Bankruptcy?

worried businessman complaining discovering mistake on document at office

Facing overwhelming debt creates feelings of stress and uncertainty. Many people fear that filing for bankruptcy in New York will lead to repercussions at work. If you are struggling financially, you may be wondering how bankruptcy will affect your employment. At Ursulova Law Offices, our bankruptcy lawyer in Brooklyn understands the complexities of bankruptcy law and how it can impact your professional life.

Is My Employer Directly Notified When I File for Bankruptcy?

No, your employer will not receive a direct notification when you file for bankruptcy. The bankruptcy court does not have an obligation to inform your employer about your financial situation.

Do I Have to Tell My Employer That I File for Bankruptcy?

Legally, you are not forced to disclose your bankruptcy filing to your employer. It is considered a private financial matter. However, there are specific circumstances where your employer might find out.

How Will My Employer Find Out That I File for Bankruptcy?

While your employer will not be directly notified, they may become aware of your bankruptcy filing in the following situations:

  • Chapter 13 Repayment Plans: A Chapter 13 bankruptcy involves restructuring your debt into a manageable repayment plan over 3-5 years. Your employer might be notified to facilitate payments directly from your paycheck.
  • Wage Garnishments: If your wages were being garnished due to outstanding debts before filing for bankruptcy, the process stops immediately upon filing. Your employer’s payroll department will need to be informed of this change.
  • Owing Debt to Your Employer: If you owe money to your employer, they will be listed as one of your creditors and will receive a notice about your bankruptcy filing.

If you are considering filing for bankruptcy in New York, seeking guidance from experienced bankruptcy lawyers in Brooklyn, NY is highly recommended.

What Happens When My Employer Finds Out?

It is important to know that federal law prohibits employers from discriminating against or firing employees who have filed for bankruptcy. If your employer takes adverse actions against you solely because of your bankruptcy, you may have legal recourse.

Here are some things your employer cannot do:

  • Fire: Your employer cannot terminate your employment based on a bankruptcy filing alone.
  • Demote: Your employer cannot change your position or responsibilities as a direct result of your bankruptcy.
  • Deny Promotions: Bankruptcy cannot be used as a factor in denying you potential promotions you are otherwise qualified for.
  • Harass: Your employer cannot create a hostile or intimidating work environment based on your financial situation.

While your bankruptcy filing might not directly impact your immediate employment, it is worth noting that some prospective employers may conduct credit checks as part of their background screening process. Your bankruptcy could potentially be a factor in their hiring decision, especially for jobs requiring financial responsibility or security clearances.

How Can Ursulova Law Offices Help?

Although the prospect of your employer finding out about your bankruptcy might cause anxiety, it is important to remember that bankruptcy offers a path toward financial stability. By responsibly addressing your debt through bankruptcy, you can show a renewed commitment to your financial health.

If you are considering bankruptcy in New York, reach out to our experienced bankruptcy attorney at Ursulova Law Offices. We offer dedicated legal guidance for individuals facing financial difficulties. Our bankruptcy lawyer in Brooklyn will thoroughly evaluate your situation, explain your options, and help you every step of the way. Contact us today for a consultation.

Ursulova Law offices, P.C.

Contact Ursulova Law Offices, P.C. to find out how our NY Bankruptcy Attorneys can help you today. Our offices are located in New York, Brighton Beach, Brooklyn and Garden City.


  • This field is for validation purposes and should be left unchanged.