Can My Employer Fire Me Because I Filed For Bankruptcy?

Can you be fired because you filed for bankruptcy?

The simple answer is no, you cannot be fired, or for that matter refused employment because you filed for bankruptcy.

11 U.S.C.A § 525(b) of the Bankruptcy Code provides that, “No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt, solely because such debtor or bankrupt”.

However, I should point out that, like all simple answers, there is a “but” to this answer.

An employer cannot fire or refuse to hire “solely” because you filed for bankruptcy.

What this means is that if an employer can fire or refuse to hire if the decision was not made only on the basis that you filed for bankruptcy.

Also, the statute only applies to private employers.  The issue of whether a public employer can use bankruptcy as the sole basis for hiring or firing has not been resolved.

Now, for what it is worth, I have never personally had a client come to me and tell me that he or she was fired because of a bankruptcy.

If you have filed for bankruptcy and feel that you were fired or not hired because of the filing, you need to speak with your attorney to make sure your rights are protected.

by Kevin Gipson, New Orleans, Louisiana bankruptcy lawyer.