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Bankruptcy and Workers’ Compensation

Many people find themselves dealing with bankruptcy and workers’ compensation at the same time.  Sometimes, people who are injured at work already have an ongoing bankruptcy case.  Other times, a work injury can cause an individual to end up filing for bankruptcy.  There are very important rules that you must consider if you have a bankruptcy case and a workers’ compensation case going on at the same time.

Through November 2015, there were almost 31,000 Chapter 7 and Chapter 13 bankruptcy filings in the Northern District of Georgia alone.  Some people do not understand that your property becomes the property of the bankruptcy estate while the bankruptcy claim is ongoing.  This means that the bankruptcy court is in charge.

Part of this property can include claims that you have against other individuals or businesses.  For example, someone might owe you money and the property right to that money is property that is part of your bankruptcy state.  Also, your claims for injuries, like a workers’ compensation claim, might be considered part of the bankruptcy estate.

How does my property becoming part of the bankruptcy estate affect me in my workers’ compensation case?

The bankruptcy court is in charge of your property until the bankruptcy is discharged or dismissed. With a Chapter 7 bankruptcy, the discharge usually happens within a few months. However, a Chapter 13 bankruptcy will usually last for years.

During the time your bankruptcy is open, you do not really have full control of your property. The bankruptcy court does. Since the workers’ compensation claim is a property right, you will probably need to make the bankruptcy court aware of the workers’ compensation claim.

The best thing to do is to get advice from your your bankruptcy attorney about this because there can be some pretty bad consequences, including losing the right to pursue your case, if you do not inform the bankruptcy court about all your property.

If you have an attorney in your workers’ compensation case, you also need to make sure that attorney gets approved by the bankruptcy court to handle the workers’ compensation case. Your workers’ compensation attorney needs to be approved because the bankruptcy court is in charge of your property (including the workers’ compensation claim).

What should I do if I have a bankruptcy and a workers’ compensation case?

Everyone would prefer to avoid bankruptcy if they could, but sometimes it is unavoidable. The interaction between bankruptcy and the workers’ compensation laws in Georgia can be confusing. If you do not do things right, the consequences are often severe. Because of this, it is usually helpful to talk to an attorney to make sure you make the best decisions.

What if I have other questions about workers compensation?

Georgia’s workers compensation system can be very confusing.  You have to worry about getting the treatment you need and paying your bills while also worrying about not missing any deadlines that could cause you to lose your right to receive workers compensation benefits.

If you have questions, I would recommend that you try to get answers.  To find out more about how to schedule a time to talk to me about your workers compensation questions, just read this short article.

Jason Perkins is an attorney who specializes in representing injured workers.  He regularly publishes videos and write blog articles about Georgia’s workers compensation system and issues that are important to injured workers and their families. To be notified of Jason’s new workers compensation videos, subscribe to his Georgia Workers Compensation Video Series channel on YouTube by clicking the subscribe button below.

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Jason Perkins

Workers' Compensation Attorney

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