Can I be fired by my employer for filing bankruptcy?

The United States has many laws governing the conditions of employment, including at will employment. These laws are designed to protect both employers and employees across the country. One of these laws strictly prohibits an employer from terminating an employee based solely on the fact that the employee has filed for bankruptcy.

While the law does prohibit your employer from firing you just for filing for bankruptcy, there are also “at-will” laws in place in every state in the United States. These at will employment laws allow an employer to fire someone for any reason or no reason at all, as long as the employer doesn’t terminate the employee for an illegal reason.

So, while bankruptcy may be an improper reason to fire someone, your employer could potentially take action and fire you and simply claim that the bankruptcy had nothing to do with it and that he was firing you for unrelated reasons. You may file a lawsuit against your employer for wrongful termination if this happens. However, if your employer is able to make a convincing case that he fired you for any reason other than filing for bankruptcy you will most likely lose.

This means the best thing you can do is keep careful records. If you have been getting excellent performance reviews and you continue to do well and don’t change your work patterns at all, then you can try to use this as evidence that your boss terminated you for an improper reason. Witnesses can also be helpful, as can any other evidence you may have that proves that your boss actually fired you because you went bankrupt.

If you find yourself in this situation and feel that your employment was terminated wrongfully because of your bankruptcy, you should consult a qualified legal representative who can assist you in assessing your case and gathering the evidence you will need in a wrongful termination lawsuit against your employer.

Case Studies: Employment Termination and Bankruptcy

Case Study 1: Falsified Reasons

Emily Anderson filed for bankruptcy and shortly after, her employer terminated her employment citing poor performance. However, Emily had a track record of excellent performance and received positive performance reviews. With the help of her attorney, she gathered evidence, including her performance evaluations and testimonies from colleagues, to show that her termination was directly related to her bankruptcy filing.

Emily filed a wrongful termination lawsuit against her employer, seeking compensation for lost wages and damages.

Case Study 2: Discriminatory Treatment

Mark Johnson, an employee who recently went through bankruptcy, noticed a pattern of discriminatory treatment by his employer following the disclosure of his financial situation. He was consistently assigned undesirable tasks and received negative comments about his ability to handle financial responsibilities. With the assistance of a legal representative, Mark collected evidence of discriminatory behavior, including emails, witness statements, and performance evaluations.

He pursued legal action against his employer for wrongful termination based on discrimination related to his bankruptcy.

Case Study 3: Retaliatory Discharge

Jennifer Martinez filed for bankruptcy, and soon afterward, her employer began treating her differently. She was given an additional workload and subjected to verbal harassment by her supervisor. When Jennifer expressed concerns about the mistreatment, her employer terminated her employment, claiming poor performance. Jennifer believed her termination was retaliatory and consulted an attorney to build her case.

Together, they gathered evidence of the mistreatment, such as emails, witness statements, and performance records, to support her claim of retaliatory discharge based on her bankruptcy filing.