Ch. 7 Rulings Won’t Fend Off Disparate Impact Claims
June 3, 2011 — Employment Law360
New York office Labor & Employment Group partner James E. Kellett is featured in Employment Law360 for his comments on three circuit courts chapter 7 rulings in the past six months that say the Bankruptcy Code does not bar private employers from refusing to hire a job candidate because they've filed for bankruptcy.
Of the three circuit court’s rulings, Kellett said, "They are clear and unambiguous in their findings, and their findings really stand up when viewed in terms of statutory construction principles… And while there's a strong basis for the Third, Fifth and Eleventh Circuit's decisions, prudent employers should be mindful of any potential disparate impact of refusing to hire people who have declared bankruptcy."
Kellett explains that risks could include triggering an EEOC investigation or setting the stage for a private class action.