Did you know you can be denied a job because you filed bankruptcy? It’s an unfortunate effect of filing that may seem illogical. After all, you need a job to rebuild, but then employers see you filed bankruptcy and decide not to hire you. What do you do? How can you better your chances of getting a job?
Who Looks?
It used to be that banking, retail, government, security, and some sales companies screened you for prior bankruptcies. For some this is quite logical: you need to be able to handle money properly. For others, it doesn’t seem like common sense at all. After all, how does filing bankruptcy hurt you ability to sell a product?
However, more companies are screening workers with credit checks, just as more are looking for clean criminal records and no drug related activities. You may be the most experienced applicant, but are denied because you had a prior bankruptcy.
Getting the Job
So what can you do? It’s legal to to screen employees, but remember not all companies will do this. Sometimes it has no effect on your job interview. However, what you can do is be completely honest from the start. If you have a prior bankruptcy, perhaps one within the last 3 years, just be completely honest about this with your employer. Tell them you filed bankruptcy, why you filed, why it occurred, and how you are preparing for life after bankruptcy.
How long does it stay?
By law, employers can look over your credit reports. And remember that bankruptcy stays on your credit report for 10 years. So even if you have one from many years ago, it can still appear. This may seem like less of a blemish, but some companies will look down on it.
Can they still hire you?
Most companies will still hire you. The major hurdle is to not have a criminal record; a prior bankruptcy does not look as bad. After all, just in 2009 over 1 million people filed for bankruptcy.
Is it against the law?
According to the law, your employer can’t decide against you because of solely your credit report. However, the initial screening process for applicants can lead to problems. Prior to meeting with you, an employer can by law look at your credit history; the regulations on screening are less tight.
Final Notes
In some cases, you may not be able to run your own business prior to your bankruptcy discharge. So if you just filed Chapter 7 bankruptcy, you may not be able to start a business. Another problem is that you can sometimes lose promotion opportunities.
These may make bankruptcy look like more of a downfall. There are few cases where a bankruptcy is the sole reason for not getting a job, but it does happen. If you have some questions on the laws, on what employers can do, and what you can do, an experienced lawyer can help.
