Can bankruptcy or filing a consumer proposal affect employment?
The main purpose of the insolvency process is to allow an honest but unfortunate debtor to get out from under their debt and get a financial fresh start and to create an even playing field and structured process amongst the debtor’s unsecured creditors in dealing with those debts.
A question that we are often asked is how will this affect my employment? A simple response is that for most situations, there will be no impact on your employment. Often, employers may be already aware that there is a financial issue going on as they have been served with a garnishment document to withhold funds from your paycheque and remit those funds to the creditor.
There are certain situations where either filing a bankruptcy or consumer proposal may have an effect on your employment. We see this situation arise predominantly from members of certain professional organizations, namely the legal and accounting professions. Under these professions, members are required to inform their respective governing bodies that they have filed an assignment in bankruptcy or filed a consumer proposal with their creditors. The professional body will review each case on its merits and may impose sanctions ranging from suspension while under the insolvency process, supervision of activities while going through the process, or expulsion from membership. These situations may create circumstances that may affect your ability to earn income.
If you are considering your options for dealing with your debts, reach out and speak with a Licensed Insolvency Trustee. At JW Weber & Associates Inc. we offer a free, non-judgemental consultation to review your specific circumstances and help you find that option that works best for your situation.