Denied Employment for Having Declared Bankruptcy

[The Straight Story]

Denied Employment for Having Declared Bankruptcy
Monday, December 28, 2009

Eric Myers of Sumter County, Florida, thought he had a found a good job opportunity at TooJay’s delicatessens. He spent two days interviewing for a management position and was told by a company official that the job was his, pending a background check. About a week later Myers was notified that TooJay’s had rescinded its offer of employment—because the background investigation revealed that he had filed for bankruptcy in January 2008. Myers is now suing TooJay’s on grounds of bankruptcy discrimination. Employers are prohibited from firing employees who declare bankruptcy, but the law relating to potential hires is less clear.

http://www.allgov.com/ViewNews/Denied_Employment_for_Having_Declared_Bankruptcy_91228

[Captain Hilts]

1. Wow. The same thing could happen to my brother. He's in Fla and declared Chap. 13. He's got an

interview for a job this week.

[napi21]

2. If he was being hired to manage the resturant, he would be in charge

of profits & losses. The company looks at his personal bankruptcy as "if you can't manage your own life how can I trust you to manage my resturant?" A Co. I ored for had a FP of finance who had failed to pay his real estate taxes. His name was published along with the others who hadn't paid in the local newspaper. He was fired for the same reason. If he couldn't manage his own finances hecouldn't manage the conpany's either.

[Tansy_Gold]

3. In this country and in these times, bankruptcy is often NOT

a matter of how well one does or does not manage one's personal finances. Medical bills, loss of prior job, etc., are far more often the causes.



TG

[napi21]

5. If those were the cause, he should have told the interviewer that

at the time of the interview. To have it discovered in a background check is bad.

[tonysam]

16. Nobody EVER asks if you have ever filed for bankruptcy in interviews.

What this guy did was sign a release like millions of other people for employers to do a background check.

I hope this guy wins big against this asshole.

[napi21]

20. Maybe they should say it in the interview. If you have something

yout're ashamef og, it's always best to state it upfront. You may not get the job but you wont get in the end either! At least if you declare it in the interview you habe the option to exlain why.

[Ichingcarpenter]

28. By that logic .... companies that went into chapter 11 or got bailouts cannot hire

Good thing he didn't apply at a GM dealership a bailed out bank

[truebrit71]

34. Which is a completely bullshit comparison...

...personal finances are only tangently related to running a branch of a corporation..

[Orsino]

47. Would you be willing to be treated by a doctor...

...who you knew had lost a family member to cancer?

[LanternWaste]

55. Along those same lines...

Along those same lines, all janitorial staff should have a pristine dwelling.

[bridgit]

4. TooJay was ham-handed about it, but background checks are...

being used as a way to either further minimize corporate risk - or so they say - in the same way intel folks look at financial records able indicate potential motives for embezzlement or passing secrets,

Or to drive wages down by citing a person's background as less worthy of an advertised compensation - and you don't have to have robbed a bank, a misdemeanor jaywalking cite years ago and they'll suggest real live people are worth less

[gmoney]

33. Sorry, but calling the deli management "ham-handed" was pretty funny...

even if not intentional.

But I would say the applicant has a legitimate beef. :)

[MilesColtrane]

87. Being denied employment put him in a real pickle.

I heard they didn't hire a female applicant because she wasn't Reubenesque.

If he sues them, they'll reply with a counter suit.

Thanks, I'll be here all week! Try the veal!

[IndianaGreen]

6. The federal government has been firing people just because they went bankrupt

and sadly, these bankruptcies were either caused by large medical bills, or by the mortgage crisis. There was a news report about this in our local TV stations about 2 years ago. The supreme irony is that the man that was in charge of getting rid of the bankrupt workers, had gone bankrupt himself. How's that!

If Uncle Sam does it, you can bet everyone else is doing it too.

[Craftsman]

24. I work as a .gov IT contractor, and for us in my branch you must have spottless credit

for at least 3 years of no job period.

[Xithras]

42. That's been SOP for 50+ years. The policy is a Cold War leftover.

The Soviets used to search for government workers having financial problems, knowing there'd be a greater probability that such people would accept offers to spy in exchange for cash. The government responded to the threat by implementing policies that terminated employees who were considered to be "high risk" for espionage, including those suffering major financial problems.

The policy kind of made sense in the 1950's when you had the Soviets actively recruiting American spies, but it's probably outlived its usefulness.

[Statistical]

59. Really no foreign govt recruit people who have access to classified information.

Whew that is a relief that humint (human intelligence) operations died with the Cold War.

http://news.bbc.co.uk/2/hi/americas/1421066.stm

http://www.boston.com/news/world/asia/articles/2008/02/12/us_alleges_two_sold_defense_secrets_to_china/?page=full

http://www.foxnews.com/story/0,2933,368681,00.html

[AllentownJake]

7. It is a form of control of the system

There are no debtor prisons, however there is a 10 year period where you will pay for it personally.

It is kind of funny because corporations pull bullshit all the time. Many very wealthy corporations are using their leverage in bad assets with lien holders, particularly banks that made bad real estate investments, promising to strategically default. At the end of the day, the legal costs will exceed the agreed reduction in payment. So a business decision is made.

America is a country of lies and it will come tumbling down, due to this.

[Odin2005]

8. That is disgusting.

Screwing people over that need help the most.

We are a society run by psychopaths. :puke:

[The Straight Story]

11. And yet the big companies that run us into the ground with their mismanagement we give money to

We have issues that affect our credit, they don't hire us - they run the country into the ground via poor management and we give them money.

[paulsby]

23. then YOU start a business

risk YOUR money, and then you can hire a bunch of people with recent bankruptcies.

one of the disincentives (and there SHOULD be disincentives) to bankruptcy is that it may affect your future job prospects.

[Name removed]

26. Deleted message

Message removed by moderator. Click here to review the message board rules.

[truebrit71]

35. No shit...

..

[paulsby]

43. translation: you have no salient argument, just name calling

how typical.

i believe that there should be disincentives to declaring bankruptcy.

there are.

[pokercat999]

48. You are correct of course, since your kind has taken over

the congress they have passed bankruptcy reform which translates to "the poor and middleclass take it up the ass while the rich enjoy the show". Good luck to you, I sincerely hope you never find your self in a position to experience what so many good people have.

[paulsby]

49. i would hope that NOBODY

would ever find themselves in that position.

the sad reality is that many people will.

i fully support the concept of bankruptcy.

i do not believe that it should be w/o consequence.

nor, apparently does congress (majority democratic party) or the american people

[FLDCVADem]

53. I agree n/t

[pokercat999]

56. It was NEVER without consequence, the problem is

the dems made the consequences too extreme for the individual while allowing the corporations to continue on as if nothing had happened.

[paulsby]

57. and that's a reasonable argument

what is not reasonable (to me) is that an employer who discovers a potential employee did not disclose a bankruptcy, may not take that into account in his hiring decision.if that makes me a (god forbid!) "corporatist" then whatever.

[Raineyb]

50. Funny they don't bother to have disincentives when CORPORATIONS

declare bankruptcy and then renege on their promises to pay pensions. Oh that's right the corporations can do whatever the fuck they want, but the little people should be reamed over and over again.

Your corporatist attitude is as revolting as it is wrong.

[paulsby]

52. yawn

corporations have disincentives too.

but we weren't talking about corporations.

there is nothing corporatist about believing that BKs should have drawbacks as well as benefits, and there should be disincentives.

that's how the real world does work.

your post isn't even right on the FACTS (not surprising from somebody who engages in name calling a la "corporatist")

there ARE disincentives to declaring bankruptcy for corporations.

as there should be

[Nikki Stone1]

63. Yes, but you shouldn't be denied a delicatessen job because you went bankrupt before.

It's not like the company is asking you to run a franchise; then I could see the bankruptcy being an issue.

[paulsby]

65. if you are dealing with CASH

i would disagree.

i am NOT saying that it should necessarily disqualify you.

i am saying an employer should be able to consider it, and more importantly, the circumstances SURROUNDING the BK whyen making hiring decisions

[Nikki Stone1]

66. Fair enough, but there should be a statute of limitations on that.

And sometimes employers don't ask about the specifics, they just say no right away.

[paulsby]

68. i would have no problem with a statute of limitation on it

iow, a bankruptcy more than X years old need not be disclosed to potential employers, as a law

and let's be honest. sure some employers might not hire ANYBODY with a bankruptcy no matter what. employers can be unreasonable in all sorts of ways when they decide what factors are more or less important for their business.

i think that should be within their latitude . and it is.

my point is that having had a bankruptcy in the past is not, and should not, have some sort of "protected class" status like race, religion, sexual orientation, gender, etc. should have.

i think one of the useful disincentives we have is that if you declare bankruptcy, it may limit your job prospects.

but i would hope most employers would take the particulars into account. and why wouldn't they? employers want to hire employees that will maximize their profit and efficiency.

[Nikki Stone1]

69. A disincentive might not help when you're talking about a medical bankruptcy

or something related to a family crisis. The idea of a disincentive might be applicable when you're just talking about wasteful people who overspend. But since around half of all bankruptcies are caused by medical expenses (see the link below), this idea of disincentive cannot be applied half the time, and it is unfair to those who find themselves in "medical bankruptcy" to be, on top of that, unemployable.

http://content.healthaffairs.org/cgi/content/full/hlthaff.w5.63/DC1

I am for protecting at least the medically bankrupt against discrimination in hiring.

[Tesha]

74. The answer to medical bankruptcies is, of course, universal health care.

Under a system of universal health care, nobody goes
bankrupt because of a medical problem.

Similarly, if we had a more-fair system of unemployment
compensation (as well as an economy that wasn't being
fully-outsourced to the third world), honest loss of a
job might not lead quickly to bankruptcy.

But there's no reason why any employer should have to hire
a person who declared bankruptcy after maxing out their
credit cards maintaining a certain "lifestyle" or who
signed a toxic mortgage without reading "the fine print".
These events would indicate very poor judgment on the
part of the potential employee and that's *NOT* someone
who's likely to be wanted in any position of responsibility
in anyone's company or corporation.

Tesha

[comtec]

77. A living wage would be nice too

between a living wage, at all levels (different per state) and universal health care, you would pretty eliminate most bankruptcies.

there are loads of other reasons, of course, but that would get rid of the bulk majority of bankruptcies out there.

but libers, and paul-ites will never accept that.

people who go bankrupt are just stupid and lazy, and bad with math and money

[paulsby]

88. i support a living wage

fwiw.

but of course since the liars say i'm a ron paul acolyte .. (does ron paul support universal healthcare? i do. does he support pro-choice ? i do. does he support welfare? i do. ), this couldn't POSSIBLY true.

should bankruptcy have consequences, and disincentives? yes

[Tesha]

89. Unfortunately, you *WOULDN'T* eliminate the bankruptcies that are associated with...

people who knew full well that their income wouldn't support
their debt level, but that's the set of folks who really do
deserve some sort of stigma for declaring bankruptcy.

Tesha

[comtec]

91. of course not and i said as much

there will be bankruptcies`, but far far fewer.
bankruptcy will go back to being a one off, not something everybody knows someone who declared in the last 2 years

making the credit card companies and banks more responsible and less predatory towards their marks...er....slave....er... clients will also go a long way to vastly reducing those numbers as well.

The point is to make bankruptcies legal, full, and rare.

and to stop letting corporations worth billions do it every other year.

[Ikonoklast]

72. Would you rather have a person with an already declared bankruptcy

running your cash register, or someone in desperate financial straits, deep in the hole with no way out, but hasn't filed anything yet?

I wonder which potential employee might be more inclined to steal.

[Hello_Kitty]

82. If you declared bankruptcy (Ch. 7 esp.) your debt is wiped out.

How do you expect people to get back on their feet?

[Raineyb]

70. What disincentives would that be? Because I've yet to see it.

Although I've seen plenty of people end up in bad financial situations because of this shitty economy then have said situation used against them when looking for a job. As though not having money when one is unemployed is somehow unreasonable.

Meanwhile the corporations go to the courts to void contracts so they can screw their workers. I as an individual can't do that. You can yawn all you want that doesn't change the fact that your attitude is reminiscent of someone who has his head shoved in his rectum.

[comtec]

76. Name 5

just 5
you've already proved what side of the fence you're on.
god it must be nice in that warm ivory tower.
always perfect temperature and humidity.

so go ahead and name just 5 disincentives that CORPORATIONS have from declaring bankruptcy?

just 5, that's all.

I'm sure your biiig brain and facts on how much superior corporations are to normal mortal human beings are.

just 5

[comtec]

32. Lemmie guess you voted for paul

i'm really getting tired of the libertarian talking points.
Bankruptcy is almost necessary to survive anymore.
I worked for YEARS in good faith, my bank and my cards never EVER tried to work with me.
They only hit me with MASSIVE fees.
I tried to get them to freeze my accounts and allow me to pay off principle because the interest of 20+% was killing me.
they refused.
so I declared bankruptcy.
It was the most humiliating thing i've ever had to do.

I felt wonderfully free after, but I still felt bad about it.

I hope I never have to do it again.
But I really had no choice, as an out of work IT guy, in the bay area, temp jobs that pay well, don't run long enough.

I always make just enough to pay down that month's cc bills.
Just the bill, not any actual principle.
I'm sure they made at least 2x what I owed them anyway from all the fucking interest rape.

so fuck you, and your bullshit!
Taking a risk is what business is about.
Just because someone declared bankruptcy doesn't mean they're bad with money.
It means they made a decision to stop the abuse and start over.

it's clear you've never been blessed with that situation

trust me if you had you'd never make dumb-fucking freeper comments like that EVER!

[paulsby]

44. more childish name calling

and a lack of reading comprehension

here's a hint.

bankruptcy should be available as an option for those that need it.

duh.

it does not therefore follow that there should not be disincentives.

you can make up all the strawmen you want, call me names, and make unfounded statements about me (all of which you have done), but in the end, you are the one being childish.

people who own businesses put THEIR capital at risk.

i had to put MY financial history in the open, when i applied for my job, and i very well may not have been hired if i had a bankruptcy. most likely my employer would have considered the reasons WHY it happened, but i don't know.

a private employer has the right to look at a prospective employee's financial background.

they are putting their capital at risk. and they are (in many cases) exposing their capital directly to an employee's hands.

if you are hiring a person for certain jobs, the bankruptcy would likely be less relevant than other jobs.

for example, hiring a stockbroker, bank teller, etc. is different from hiring a laborer, etc.


individuals (and corporations) should have the option of bankruptcy.

they should also (and most do) recognize that declaring bankruptcy has drawbacks.

that way they can make a cost/benefit analysis and decide whether to declare it.

that's how the real world works

hth

[Hassin Bin Sober]

39. Ha ha ha ha!!!

This, coming from a cop. A civil servant sucking on the gubmint tit. How many of YOUR co-workers have BKs on their credit report?

I've been in the retail credit business for 20 years and I'll tell you cops are some of the biggest offenders.

[paulsby]

46. i doubt many had them BEFORE

they were hired.

there is a big difference (as the article points out) between an employer using a BK during the decision to hire, or trying to fire an employee (off probation) who gets one.

we had to go through extensive financial, psychological, physical tests, that the vast majority of private sector jobs don;t. heck, it is ILLEGAL for a private employer to require a polygraph in my state. but we have to take them as a condition of employment.

regardless, if i had a BK, i would have had to declare it, and it MAY have meant i wasn't hired.

that's the price you pay.

hth

[joeunderdog]

67. Isn't that like witholding food from the undernourished?

Maybe that individual lost their job and was unable to find another one so they had to file for Bankruptcy. Maybe their company folded and they were rejected from jobs because they "had a gap in their resume" and then had no money left to pay their bills. What makes them an unfit hire? They still have job skills.

Being broke does not always mean you are irresponsible. Don't forget--you may be broke someday, too. Then what are YOU gonna do to get that job with a Bankruptcy on your file?

[Odin2005]

73. Most bankruptcies are because of MEDICAL BILLS.

Not the result of the Social Darwinists' "irresponsibility" boogyman.

[Hello_Kitty]

83. Have you been paying attention to recent events at all?

People are losing their jobs, their homes, and trying to scrape by. As recently as 2006 you would have a point but it's a whole different world now. 2 years ago I had an 800 credit score, a house, and a good job. Those are all gone and my UI benefits run out next week. What am I supposed to do? Kill myself?

[pokercat999]

25. +1

[davidpdx]

9. I hate the fact that employers do financial background checks

I understand in terms of fraud and criminal stuff doing criminal background checks, but bankruptcy could be for a number of different things that are unexplained. I mean who knows, it could be because your six year old had to have surgery and you couldn't afford to pay the bill and the hospital came after you for the balance and you had to file for bankruptcy. If you got laid off or something and had no insurance, that is pretty harsh to just say, "well, we won't hire you because you've been bankrupt".

[MiniMe]

13. I think it depends on what job you are applying for

Anything handling money could be a liability for the company. If you would be in charge of writing or taking in money, I can understand it. Other than that, it shouldn't apply.

[tonysam]

18. It's still illegal when it comes to employment.

This guy isn't going to steal money now that he has no debts. It makes no sense whatsoever to discriminate.

[FLDCVADem]

45. It is not illegal

Where do you come up with this stuff?

[Statistical]

61. It may be wrong but it certainly isn't illegal.

Two of the last 4 jobs I have required passing credit check and criminal background check.

[Hello_Kitty]

84. Even with most jobs handling money there's very little danger.

Most places that transact money have so many safeguards in place, and cameras, that only a fool would try to steal.

[ipaint]

10. Funny how the reasoning doesn't work for the elites.

Run the country into the ground and you get an administration job.

The arrogance of these types of policies is incredible. How ever did we get along before companies decided they owned you both on and off the job.

[glitch]

40. " Run the country into the ground, OWE 250k BACK TAXES and you get an administration job." nt

[DRoseDARs]

12. Someone explain this to me: What in the hell does his bankruptcy have to do with his being hired?

I don't understand the employer's rationale. Is the bankruptcy court going to liquidate the employer's assets? Kill their pets? Steal their grandmothers' teeth?

[tonysam]

14. It's another way to screen people out

The same is true with disclosure questions asked of potential teacher hires, and those questions are used to blackball teachers systemwide throughout the United States and have nothing to do with children's welfare or committing criminal acts.

[MiniMe]

15. It depends on what the job is

If you are in charge of handling money in any way, such as AP or AR, I can understand it.

[tonysam]

17. A bankruptcy wipes out debts

Nobody should ever be denied a job because of bankruptcy. How in the hell is anybody supposed to EVER get a fresh start if somebody discriminates?

This is illegal, and the guy should win big.

[RebelOne]

30. A Chapter 13 does not wipe out debts

I should know as I just was discharged from a Chapter 13. I had to pay $700 to a court trustee monthly until all my debt were paid off. It took three years, but now I am debt free.

[Statistical]

62. You keep CLAIMING it is illegal.

Maybe it SHOULD be illegal but it is most certainly legal.

[lib2DaBone]

19. It happens all the time in Florida...

Employers routinely pull a credit history before they will even consider you. The last 3 jobs I applied for all wanted credit checks.

I think it's a corporate Repuke thing.. they figure if you filed bankruptcy or had a foreclosure.. the assumption is that you must have done something wrong.. it's YOUR fault for getting sick or being laid off or having no health insurance.

One Repuke said to me, "Well, you could have used COBRA from your last job". Ya...sure, but it costs over $1,100 a month to COBRA, and if you have no income and you are denied unemployment...it hurts.

Welcome to Forida... a Repuke-heaven, right-to-work, abusive low-wage hypocrite Jesusland.

[The Straight Story]

21. Ask them about bank bailouts, AIG, etc

And if we should have given them any money after they screwed up.

[Goldstein1984]

22. Employers are enjoying an employer's job market

When unemployment is high they can get away with a lot more.

An employer in Alaska, Alyeska Pipeline Service Company, which operates the Trans-Alaska Pipeline, has gone beyond the required DOT urinalysis and has instituted a hair drug testing policy for all employees, including contractors, working on TAPS. The hair test requires a minimum of 1.5 inches of hair, with a minimum sample weight of 80 milligrams. Failure to provide enough hair is considered a fail. The test can detect the use of the standard 5 drugs going back three months. It cannot be beaten the way a urinalysis can.

They can get away with this because jobs are being cut, and most people prefer the test to unemployment.

I believe it's a violation of the Alaska Constitution's guarantee of privacy, and possession and use of several ounces of marijuana in Alaska is protected by the same privacy clause in the constitution. Of course, anybody who brought the case to court would never work in the oil industry in Alaska again, so the test is unlikely to be challenged.

I know this is off the subject of bankruptcy, but it seems to me to be part of the same pattern of hubris by industry against workers.

[Jkid]

41. A minimum of 1.5 inches of hair

Not everyone has that type of long hair. That immediately excludes african-americans, as they usually have short hair strands, IMO.

[SoCalDem]

27. Management positions often have stricter requirements

Bankruptcy, though it's lost a lot of the stigma, still signals an inability to manage money. Managers are put in charge of a company's assets (to some degree), and the people hiring have a duty to safeguard those assets.

I am NOT saying that a person who declared bankruptcy is a thief, or would steal, but ANY personal information that "could" lead an interviewer to wonder if the person they are thinking of hiring, might be less than a good "manager", could disqualify that person...especially when there are other applicants.

[tonysam]

58. Do you understand bankruptcy discrimination is ILLEGAL?

It has no bearing on "managing" money, but life circumstances make it impossible to consider any other option.

How in the FUCK is anybody supposed to get a "fresh start," which bankruptcy guarantees, when asshole employers don't give people a chance?

[SoCalDem]

60. I understand completely.. but no one can FORCE another person to hire anyone

and when multiple applicants are available, attrition comes into play. If the interviews TOLD them they were disqualified specifically for the BK, the interviewer may live to regret it, but if the applicant just "did not get the job", and SUSPECTS that was why, they'll have to spend a lot of time in court trying to prove it.

[tonysam]

79. You don't get it. He was denied a job because of his bankruptcy.

It's discrimination, just as it would be for race, religion, or gender.

It's against federal law.

[SoCalDem]

80. good luck to him with his lawsuit, then

and good luck to the person interviewing him, who told him ..that one;s probably looking for a job as well
'
happy new year to all

[Statistical]

64. Please educate yourself.

http://www.privacyrights.org/fs/fs16-bck.htm

Running credit check for employment is 100% legal under federal law.
There is no requirement the job even be related to money, cash handling, or finances.

As long as employer follows FCRA they can use credit report as requirement for employment.

Just because you personally disagree with something doesn't make it legal discrimination.

The applicatant will have his case thrown out of court unless the employer did something stupid and didn't follow the law (get permission, follow process, use proper 3rd party, give notification, etc).

[FLDCVADem]

90. No, it is not illegal in hiring

No matter how many times you say it is.

[no_hypocrisy]

29. OTOH if you have a business, declare b/ruptcy, you can start a new business under a new name

and go on your merry way. The only difference is capitalization and attitude.

[Pab Sungenis]

31. This is an abuse of the system

that should be outlawed as part of a major financial system overhaul.

[Liberal_in_LA]

36. crazy. Hope he wins his lawsuit

[TheKentuckian]

37. More bullshit and more water carrying for corporate commies

who'd never live under the rules they lay down.

[Greyhound]

38. Rather telling that there are defenders of this practice here.

:kick: & R

[Thickasabrick]

51. I know...it's like it's the other DU in another reality...like "Fringe" nt

[HughBeaumont]

75. Yep.

And they're the same ones that defend even the most heinous corporate practices on other threads.

Have a feeling my ignore list, already filled to the brim with right-wing laissez-failers, is going to grow as this "Tent" gets bigger and more unfeeling.

[Moochy]

85. They do seem to have the run of the place

[Hawkowl]

54. Shoulda been offered a retention bonus!

And he should have been offered a raise because of his bankruptcy expertise! Oh wait. That only happens to high level executives who "save" companies by driving them into bankruptcy to steal workers pay and benefits.

[David Zephyr]

71. And employers now want to see the prospect's credit scores, too.

Soylent Green.

[gopwacker_455]

78. How sad this country can be

[Union Yes]

81. I hope he wins his case and that the judgement makes an example. knr nt.

[Hello_Kitty]

86. Millions of Americans are un-hireable because of this practice.

In many cases, probably the majority of them lately, through no fault of their own. What are you supposed to do when you've been laid off, exhausted your savings, and exhausted your unemployment? What if you couldn't keep up with your credit cards because you had to choose between that and eating? There needs to be some kind of moratorium on these credit checks by employers.

OTOH, it seems kind of counterintuitive for employers to screen out heavily indebted applicants. Geez, you'd think they'd make ideal employees. Grateful for the job and scared to death of losing it. :shrug: