Stockton Bankruptcy lawyers California

Many people are afraid to file for bankruptcy because they think everyone will find out. Nothing could be further from the truth. Nobody other than the creditors are contacted when a debtor decides to file for bankruptcy. That means other than your creditors, the only way anyone will find out about your bankruptcy is if they run a credit check on you.

Bankruptcy lawyer Stockton, CA-Government Discrimination

Section 525 of the US bankruptcy code provides that a governmental entity cannot discriminate against someone for filing for bankruptcy. That means they cannot deny, terminate, suspend or discriminate with respect to employment any person who has filed a bankruptcy. Section 525 further prohibits the government from discriminating against someone who doesn't pay a dischargeable debt or has been insolvent prior to or during a bankruptcy proceeding.

Attorneys Bankruptcy Stockton, California-Private Employers

Similarly, private employers can't discriminate against people who file for bankruptcy. That means they are prohibited from terminating or demoting someone, solely because of the bankruptcy. The term "employment" is much broader in the bankruptcy sense than usual. Employment relationships have been found with workers that would have been labeled independent contractors under state law. Section 525 of the bankruptcy code also applies to promotions and advancements. An employer can't demote someone or fail to pay their quota because of the bankruptcy filing.

Bankruptcy Stockton Lawyers, San Joaquin County-Proving the Discrimination

The Bankruptcy Code states that an employer can't discriminate against an employee "solely" because of the bankruptcy filing. Therefore, an employer is free to terminate or demote an employee if there are other sufficient reasons such as lack of performance. If reasons exist that would justify the act by the employer, then the conduct will likely not be in violation of section 525 of the bankruptcy code.

Bankruptcy Attorneys Stockton California-Debtor's Remedies

If a debtor is able to establish discrimination under section 525 of the Bankruptcy Code, he may be entitled to an order enjoining the employer from further discrimination and/or monetary damages for lost income. Punitive damages however, cannot be recovered.