Federal court says it is ok to discriminate against bankrupt job seekers.

Back in February 2011 I posted the blog below about a trend where employers are discriminating against the unemployed. Some employers stated that if a person was unemployed than that could be a sign that person is not a good hire! That is a harsh statement considering the millions of people who were laid off through no fault of their own over the last two years of weak economic activity.

However, the problem for someone looking for work doesn't end there. ConsumerAffairs.com just reported that the  United States Court of Appeals for the Fifth Circuit ruled that it is ok for an employer to discriminate against a job seeker who has filed for bankruptcy. The court noted that while there is a law stating the government may not discriminate against applicants who have filed for bankruptcy, that same law doesn't not put the same requirements on private employers. Keep in mind this is different from someone who already has the job and then files bankruptcy.

If you search the web you will find varying opinions on the depth of this issue. Most people agree that if you are already employed or are applying for a government job you having nothing to worry about if you have a bankruptcy on your credit record. However, the difference is if you are applying for a job with a private employer. This ruling doesn't stop the private employer from discriminating against you if you were bankrupt. I personally worked for an employer in Pittsburgh that discriminated against applicants based on their history with credit. Just like in the news story, the upper management of this company stated that in their opinion someone's history of debt payment indicated their integrity with handling financial transactions, such as collecting payment from a customer for a purchase.

It is not uncommon for an employer to run a background check on you. Many industries feel that they need to also view your financial history as you may directly or indirectly be dealing with the company's or customer's money. Whether their logic is right or wrong, the fact is that there is no law prohibiting them from doing that. If you are convinced you want to work for an employer who requires you to share your credit history with them be sure you get to see the report before they do. Order your free credit report and be sure it is free of errors. If you are questioned about bankruptcy be honest and be ready to explain the lessons you've learned, and how you would make a great addition to the company.

The United States Court of Appeals for the Fifth Circuit includes:
Eastern District of Louisiana
Middle District of Louisiana
Western District of Louisiana
Northern District of Mississippi
Southern District of Mississippi
Eastern District of Texas
Northern District of Texas
Southern District of Texas
Western District of Texas

Trend: Employers passing over the unemployed.

If you have lost your job one of your concerns may be the employment gap on your resume. Most companies you will interview with will ask you to explain the employment gap. That is, if you get the interview in the first place. The February 17, 2011 Yahoo! News article  "Help Wanted - jobless need not apply" stated "Job-placement professionals say that over the last year, more and more employers have made it clear they won't consider job candidates who aren't working." "Some employers have said they're unwilling to hire unemployed workers because they believe that if a worker has once been let go, that's a sign that he or she is probably not a great hire."

"And as Federal Reserve Chair Ben Bernanke has said, when people are out of work for a long time, their skills can erode, which may understandably make them less attractive to employers."

Taking part-time work while searching for full-time work may benefit you with additional income (you can earn x amount of money while unemployed without losing your unemployment benefits) and having a current job to list on your resume. Remember you don't list how many hours you work on your resume; you list the jobs you are holding or have held. An employer reviewing your application may not know you are only working 15 hours a week, but will see that you are a working, that someone else believes you are employable.

A part-time job while you search for full time work could provide you new skills, new contacts, and new ideas in addition to building your resume and your household income.

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