How IVAs Affect Employment
The income you need to pay off your debts means you must be able to hold down a job or keep your business on track, but that’s hard to do when debt affects every part of your life, from your relationships with co-workers to your job performance. While a debt solution like an IVA sounds ideal, could it affect your prospects for earning money? Could you lose out on promotions or sales because of an IVA, or perhaps be turned down for a new job if a credit check was carried out?
Over the years we’ve dealt with a lot of worries people have about employment prospects when on an IVA, and here is a selection of the most common ones:
Will having an IVA stop me being selected for a job?
Your average job doesn’t have strict financial vetting procedures that would stipulate having an IVA is undesirable, but there are some jobs and contracts that do. The Police, Fire Service or Prison Service certainly do, as do positions with fiscal responsibility such as an accountant or solicitor. All have strict financial vetting procedures. If you are self-employed, even government and some council contracts require submission of a financial statement to prove your company is solvent.
Could an IVA affect my business profits?
Rigorous financial vetting can sometimes be used as part of the selection process for bids and tenders for work. That rigor could extend right down to every member of the team who is doing the job, something which many employees would be unwilling to supply. If the company or someone working within it has an IVA or significant debt you could end up being considered ineligible to tender.
Does an employer have to know about your IVA?
There are no rules within IVA legislation that says an employer must know about an employee with an IVA, unless it is clearly stated in your employment contract. Some professions have strict rules about IVAs and it would be a requirement of your job that you would not to be declared insolvent, so you would have to let your employers know what was happening if you wanted to go down this route.
Could I face a disciplinary or even lose my job?
It is unlikely that having to tell your employers you need to undertake an IVA will result in you being disciplined or losing your job. It’s more likely to happen if you hide the IVA and are discovered if it stipulates in the your employment contract the need for your employers to be told straight away. Your attempt to deceive them will cast you in a poor light.
Professional Standards or Welfare teams are becoming more common in businesses with these types of strict employment contracts, so you may be able to speak to someone there in confidence and get ideas and suggestions on how to tell your employer.
Could my IVA be discovered by work colleagues?
No-one, not even your work colleagues, will know if you have an IVA. There are no announcements published in local media or national financial newspapers. Only if they specifically search for your name on the Insolvency Register will they find out.
Can someone unemployed have an IVA?
There are very few criteria that make someone ineligible for an IVA, but being unemployed and in receipt of benefits is one of them. An IVA relies on you being able to pay back a minimum of £175 a month to creditors, and benefits are not know for being too generous in this respect. It is unlikely the money you receive would be enough to cover the cost of living and debt payments too.
To find out more about IVAs and whether they are right for you, call now and speak to one of our experienced IVA advisers now on 0800 987 5337
Example Unsecured Debts
Your Monthly Repayments Would Be
an IVA £748
(total contractual repayments)
an IVA £295
(total contractual repayments)
* Subject to creditor acceptance
* Payment subject to individual circumstances
* Credit rating may be affected
* Fees apply, subject to individual's circumstances. For more information on our fees click here