Some firms are firing workers who are in debt - especially if they have a county court judgment against their name.
A judgment or CCJ is a formal debt finding imposed by a county court judge.
CCJs are generally for small amounts and remain on someone’s credit record for six years.
Over recent months, the courts service says an average 1.391 CCJs were issued every day for an average debt of £3,345.
Many companies are now including clauses in employment contracts that make having a CCJ or other insolvency solutions - like IVAs (independent voluntary arrangements) or bankruptcy - sackable offences.
The worry for some employers is that having employees who cannot manage their own finances could cause issues at work, even if they do not handle money.
Finance professionals, like accountants, are often struck of by their professional bodies for even the smallest findings of debt against them.
In some cases, banks and credit card companies are known to instigate court action against finance professionals in a bid to make them settle their debts because they know they could otherwise lose their livelihoods.
CCJs can have other financial implications for people in debt. Many car and home insurance companies credit check customers before offering payment plans - and more employers are making the checks before taking on staff.
If you are worried about black marks on your credit record and how these might affect your job or finances, contact the three main credit bureaux for a copy of your file. Each firm - Experian, Equifax and Callcredit - offers a report for £2.
The credit report will list all your bank accounts and borrowings, payment histories showing late or missed amounts and any defaults, CCJs and any other court insolvency action.
In most cases, credit companies will hold off legal action for bad debts if the customer agrees a financial management plan.
A financial management plan is an agreement to pay back the debt at an agreed monthly amount that is often less than the contractual repayment.
As with all debt issues, the best way of dealing with the problem is to take some positive action before banks and credit card firms start court proceedings.
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Notes to editors:
- Money Debt and Credit is one of the UK's fastest growing financial solution companies.
- The company was founded in 2006 on the belief that every client has the right to appropriate financial advice. Since then we've gone from strength to strength and have helped thousands of people with a variety of financial solutions.
- We offer a range of services including Financial Management Plans, Loans, Mortgages, Full & Final Settlements, Bankruptcy, Investments and Pensions.
- Specialties: IVAs, Financial Management Plans, Loans, Mortgages, Trust Deeds, Full and Final Settlements, Bankruptcy
For more information or debt advice contact:
Money Debt and Credit
45 Clarendon Road, Watford, WD17 1SZ
Tel. 0800 16 999 46
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