Filing Bankruptcy With a Company Credit CardMaintaining a credit card with an employer has become common place; but if a debtor maintains a balance on an employer credit card and needs to file bankruptcy, that credit card balance could jeopardize the debtor’s job.  First off, let’s make it clear, that an employer cannot fire a debtor solely because they filed for bankruptcy.

The bankruptcy code states:

No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title … solely because such debtor … is or has been a debtor under this title….  11 U.S.C. sec. 525(b).

However, the reality is that if you have an employer credit card and it is discharged in bankruptcy, you may not have a very happy boss.  In 2009, there was a bankruptcy case that involved a debtor who was required to get and maintain an American Express credit card as part of their job.  When the debtor filed for bankruptcy and the card was cancelled, the employer fired the debtor.  The debtor sued the employer claiming that they were fired because they filed bankruptcy.  The debtor lost the case.  The employer successfully argued that they mostly fired the debtor because they were performing poorly at their job and the employer provided evidence to prove their point.  When the debtor argued that they were fired directly because of the bankruptcy, the court said that since the debtor was not solely fired because of their bankruptcy, the employer was not in violation of the bankruptcy code’s anti-discrimination clause.

The bottom-line is this, if you have an employer credit card be very careful to not keep a balance if you think you may need to file bankruptcy.  A matter of fact if it is not required that you keep and maintain the card, it might be wise to forego having an employer credit card all together.