Bankruptcy And Discrimination- What You Need To Know

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Federal law is clear on discrimination against people who are in debt whether it be government or private agencies.

It is illegal for the government and private agencies to discriminate against people who-

1. Was/is in debt
2. Cannot pay the debt before or during a bankruptcy case.
3. Got their debts discharged during the case.

History in bankruptcy discrimination.

The US constitution grants the federal government the power to set bankruptcy laws and it is uniform in all 50 states. Bankruptcy is a national matter, so any case can come up in the US supreme court as well.

Federal law of discrimination was made in 1971 when a case called Perez v. Campbell came to the supreme court.

Here Perez stated that the state cannot take a person’s driver’s license because he/she got his debts discharged in a bankruptcy case. This case made the law a necessity.

Government discrimination during bankruptcy.

There are laws to protect you from discrimination just because you filed for bankruptcy. There are ways of discrimination and the laws prohibit the following forms of government discrimination against bankruptcy debtors-

1. Firing a person due to his or her bankruptcy case filing.
2. Discriminating when hiring for positions.
3. Because of a bankruptcy case a person is denied, suspended, canceled, revoked, or declined any licenses, franchises, or other privileges.
4. Denying a government grant due to a bankruptcy case.
5. Listing certain conditions that are related to bankruptcy in a form for a grant application.

Court has taken these laws very seriously.

With this the court has also declared a law where there is no discrimination against a person who is associated with a bankruptcy, it also includes family members or business partners.

Can an employer fire someone who has a bankruptcy case going on? 

No, just like government employers cannot discriminate against someone who has a bankruptcy case going on, it is the same for private employers also. For both government as well as private employers the forms of bankruptcy are similar.

These include bans against –

1. Firing an employee because a bankruptcy case is going on in their name.
2. Not hiring an employee for a position just because they have a bankruptcy case going on or had a bankruptcy case.
3. Discriminating against the family members, business partners, or friends of a debtor.

If you faced discrimination personally or know someone who did-

If you faced discrimination just because you filed for bankruptcy you need to talk to an attorney who can help you prevent it in the future. No government or a private company should discriminate against you just because you filed for bankruptcy. The federal law supports you as it is illegal to discriminate.

If you are not filing for bankruptcy because you might get discriminated against, fear not the federal laws are there for you. So if you want to file for bankruptcy and start a fresh life do not wait. If you want good legal counsel and if you live near Los Angeles & Dallas, TX, reach the Recovery law group – (888-297-6203).