• Filing for bankruptcy is a serious financial decision with long-lasting consequences. According to the Federal Trade Commission (FTC), people who plan to file for bankruptcy must receive credit counseling 180 days before they file. While this counseling session will include an evaluation of your financial situation, a discussion of alternatives to bankruptcy and review of potential tax consequences, it might not address the effects of bankruptcy on employment.
  
  

Fidelity Bond

• According to the Wisconsin Department of Workforce Development, a commercial fidelity bond is an insurance policy that protects an employer in case of loss due to employee theft, embezzlement, forgery or larceny. The bond "guarantees" to the employer that a person hired will be honest. For some roles, an employer requires that employees be bonded, but the process requires a criminal and financial background check. If you have filed for bankruptcy, you will not pass the bonding process and may be disqualified from holding certain sensitive roles, such as those involving cash transactions or money transfers. Some states offer bonds for people who are not eligible for commercial bonding as a means to help them gain employment. After a certain period of time with no instances of dishonesty, the employer's commercial bond will usually cover the employee. However, the inability to commercially bond an employee is grounds for denying employment.
  
  

Security Clearance

• One of the effects of bankruptcy on employment is that it can limit your ability to obtain a security clearance or keep a clearance you've previously been granted. To be cleared to work in some federal, military, government and private sector jobs, you must undergo an application process that includes criminal and financial background checks. In some cases, bankruptcy is an indicator of financial irresponsibility, and can complicate or stop the clearance process. If you have a security clearance and file for bankruptcy, be aware that the circumstances of your bankruptcy will be reviewed and your clearance might be revoked.
  
  

Current Jobs

• Filing for bankruptcy while you are employed can limit your ability to progress at work. According to the FTC, employers run credit checks not only during the hiring process, but also when evaluating employees for reassignment, promotion and retention. You may not be allowed to apply for positions in departments that handle cash, make financial transactions or manage the company's financial records. If you are already in a position that involves control of money, you might be moved to a different role. Although you cannot be fired for filing for bankruptcy, the stress of dealing with your financial situation may have caused your work to decline, and poor performance is grounds for dismissal.