Will bankruptcy affect my employment or prevent me from getting hired? Many people considering bankruptcy ponder this question. Here is a summary of the federal and state (Maryland) laws related to bankruptcy and employment.
If an employer intends to order a copy of an applicant’s or current employee’s credit report, the employer must abide by the rules of the Federal Credit Reporting Act. The FCRA mandates that:
There are many states that have also passed laws that tend to cover the issues of credit and employment as well. Maryland is one of those states. The state laws will typically take precedence over the federal FCRA. The Maryland legislature passed the Job Applicant Fairness Act in 2011 and it has provisions that limit employers from using a job applicant’s or current employee’s credit report in various situations. The Act generally prevents employers from using findings of credit reports to determine their employee hiring and termination decisions. Also, the Act prevents employers from basing pay or related employment conditions off of credit history findings. It should be noted, as with most things, there are exceptions. The law typically excludes employers such as:
Even if they are covered under the law, employers must still provide notice to employees or applicants if they are using their credit report for any job related purpose. Typical job positions where an employer covered under the law may decide to evaluate credit reports are: