Planning to default - is my job affected?

LoveVictor79

Quick question: I am planning to default on my unsecured debts. I haven’t missed any payments yet but will do so from June. I work for a law firm as a legal PA. Is my job going to be affected? 

tigergambit

Shouldn't be but you need to check your employment contract.

sourcrates

Question:

Do you, or have you ever had too, supply a copy/copies, or give permission for your employer to obtain a copy/copies, of a credit report, or do a credit check, in your name?

If the answer is no, its quite unlikely anyone would find out if you defaulted on your credit agreements.

LoveVictor79

When I joined, they carried out enhanced employment checks with Experian ‘which include identity, financial, criminal record and educational’. That’s the wording from my offer letter. I have never been asked to give them a copy of my credit report. 

LoveVictor79

Employment contract says ‘the company may terminate your employment with immediate effect if you have become bankrupt or had an interim order made against you under the Insolvency Act or compounded with or made any arrangement with your creditors generally.’ 

So now I’m panicking!

sourcrates

LoveVictor79 said:

Employment contract says ‘the company may terminate your employment with immediate effect if you have become bankrupt or had an interim order made against you under the Insolvency Act or compounded with or made any arrangement with your creditors generally.’ 

So now I’m panicking!

Seems a tad harsh that, but note the magic word "MAY" terminate your employment.

A word used by many debt collection agencies to suggest a not very pleasant outcome.

Do you perhaps want to complete an SOA of your circumstances and we may be able to suggest options that may help you.

DankVielen

LoveVictor79 said:

Employment contract says ‘the company may terminate your employment with immediate effect if you have become bankrupt or had an interim order made against you under the Insolvency Act or compounded with or made any arrangement with your creditors generally.’ 

So now I’m panicking!

The key word is MAY

However, a DMP is NOT insolvency, it is debt management.

They probably have the same contract for all staff, I doubt that someone in your role needs to be squeaky clean in terms of credit.  If you were a financial advisor or advising customers directly on wills that might be different, but you are not performing those tasks.

Also while people love to write terms in a contract, they can be voided if they are contrary to common law, for example you can't be evicted in two days even if your Tenancy Agreement says you can.  The legislation overides and make said term an unfair contract term, it can even void a contract if it does not have an isolation clause.

born_again

LoveVictor79 said:

When I joined, they carried out enhanced employment checks with Experian ‘which include identity, financial, criminal record and educational’. That’s the wording from my offer letter. I have never been asked to give them a copy of my credit report. 

You do not need to supply them the data, they check it themselves. Which is what you agreed too.

You need to speak to your employer on this. As by defaulting you will be/are considered a higher risk to the business.
A fellow colleague was escorted out of the building when bank found out his wife had been declared bankrupt. As it had never been discussed the issue with them.
Other cases where defaults have been logged & bank had been informed, bank worked with them to support the resolution of the issue.

RAS

Going back to the 2008 financial debacle, on these forums many people working in finance found themselves in extreme financial stress. 

The general advice was to contact your union rep if you had one, if not then HR, and have a "what if" conversation.

We don't know your employer, we don't know how they might take things. 

But I can tell you that then some were given basic advice and support, some worked with employers' debt advisors to stabilise their finances and make reduced payments, a few even went bankrupt with their debt advisor's support. None of these folk lost their job.

The only person who lost their job was the one who came on-line shocked to discover that their employer didn't appreciate being told about his bankruptcy by the OR and was met by security and escorted to pick up his personal possessions.

LoveVictor79

Thank you for the replies.  My brain is completely frazzled, I don’t know which way to turn. I have a lump sum coming to me in October so the majority if not all debts can be cleared but until then, I am stuck as to what to do.  I am so stressed and have hardly slept this weekend. I think I need to change my plan of just defaulting and see if I can reach an agreement with some or all of my creditors for the next 4 months. I may also ask a close family member if they can lend me some cash so I can pay for the essentials.  What a mess.  

RAS

Perhaps wiser to have that discussion with your union or HR person, emphasising that you can clear most of the debt then?