David M. Siegel answers in 26 seconds. Watch on YouTube · Read the transcript.
Short answer: In most cases, no. There is generally no reason for your employer to be told. The one exception is when they have to be notified in order to stop an active wage garnishment. Otherwise a typical Chapter 7 runs its course and nobody at work needs to know.
Nobody sends your employer a notice
Creditors get notified because they are parties to the case. Your employer is not a creditor and is not a party, so no notice goes out. There is no form that tells them and no obligation on you to volunteer it.
In a typical Chapter 7 the case is filed, the meeting of creditors happens on Zoom, the discharge is entered, and nobody at work has any reason to learn about any of it.
The garnishment exception
If your wages are already being garnished, your employer is involved — they are the ones withholding the money, on a court order. To stop it, they have to be told the case has been filed.
Worth keeping in perspective: if a garnishment is running, your payroll department already knows about the judgment. Filing does not reveal anything new. It tells them to stop taking your money.
The other place it can surface
Bankruptcy filings are public court records. Nobody at work is likely to go looking, but a background check that includes credit history can turn one up — which is why it can appear during hiring for certain roles rather than during ordinary employment.
Federal law prohibits both government and private employers from terminating someone solely because they filed bankruptcy. Private employers have somewhat more latitude in hiring decisions than in firing ones, which mainly matters for positions involving money handling or a security clearance.
The privacy question underneath
This question is almost never really about the employer. It is about whether this can be done without one’s life becoming a topic of conversation.
It can. The consultation is by phone, the case is handled by phone, and the meeting of creditors is on Zoom. There is no waiting room to be seen in and no day off to explain.
Want to handle this without anyone at work knowing?
The consultation is free and there is no obligation. You will find out what you qualify for, which debts can be eliminated, what it costs, and what the payment plan looks like.
Wheeling: (847) 520-8100 Chicago: (773) 276-6969
Your case is handled by phone — you do not need to come into either office. Even the meeting of creditors is held on Zoom. We represent clients across the Northern District of Illinois: Cook, DuPage, Grundy, Kane, Kendall, Lake, LaSalle and Will counties.
Full transcript of the video
will my employer know that I filed for bankruptcy generally there’s no reason to let the employer know that you filed for bankruptcy unless they have to be notified to stop a garnishment that’s the only time that employer would really come into play and find out about your case in most cases the employer will not find out you’ll be able to eliminate your debt and go about your life and no one at work needs to know that’s a typical scenario for a chapter 7 bankruptcy case
Related questions
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- Is filing for bankruptcy a failure?
- Will bankruptcy ruin my credit?
About the author. David M. Siegel has represented consumer bankruptcy clients in the Northern District of Illinois since 1991 and is the author of several books on consumer bankruptcy. The firm has offices at 790 Chaddick Drive, Wheeling, IL 60090 and 10540 S. Western Ave, Suite 202, Chicago, IL 60643, and handles cases by phone for clients throughout the Chicago area.
This article is general information about Illinois and federal bankruptcy law. It is not legal advice, and reading it does not create an attorney-client relationship. Every case turns on its own facts — speak with an attorney about yours.