Will a Consumer Proposal Affect My Employment?

A common concern among individuals contemplating a consumer proposal is its potential impact on their employment. As a debt management solution, a consumer proposal can significantly alleviate debt-related stress. But does it carry any ramifications for your job?

Understanding Consumer Proposals

To clarify, a consumer proposal is a legally binding agreement between a debtor and their creditors, allowing the debtor to pay off only a portion of their debts. This debt relief option is administered by a Licensed Insolvency Trustee (LIT), who negotiates with creditors on the debtor’s behalf.

The Impact of Consumer Proposals on Employment

In most cases, a consumer proposal does not directly affect your employment. Your employer typically won’t be notified unless they are one of your creditors. However, certain professions might have different regulations, and it’s wise to investigate before proceeding with a consumer proposal.

Disclosing Consumer Proposals in Certain Professions

Certain professions, particularly those requiring licensure or those involving financial trust, may have specific rules regarding debt solutions like consumer proposals. Here are a few examples:

Chartered Professional Accountant (CPA)

If you’re a CPA or aiming to become one, a consumer proposal could have implications. According to the CPA Ontario Regulation 7-1, a CPA must inform CPA Ontario in writing about their consumer proposal and the circumstances leading up to it. Based on this information, CPA Ontario will decide on the individual’s admission or continuation as a CPA.


Lawyers might also need to report their consumer proposal to their licensing body, the Law Society of Upper Canada.

Human Resources Professionals

Human Resources professionals, including CHRP, CHRL, or CHRE designates, are required to notify the Human Resources Professionals Association (HRPA) immediately upon filing a consumer proposal.

Certified Financial Planner (CFP)

CFPs must inform the Financial Planning Standards Council (FPSC) within 15 days of filing a consumer proposal. When applying for certification renewal, the FPSC must be informed of the consumer proposal in the Declarations and Professional Obligations section of the renewal form. The FPSC will then consider the reasons behind the filing and decide on certification status.

Seeking Professional Advice

If you’re unsure about how a consumer proposal might affect your employment, it’s always a good idea to seek professional advice. A licensed insolvency trustee can provide guidance tailored to your specific situation and employment status.

Wrapping Up

In general, a consumer proposal should not affect your employment unless your employer is one of your creditors or if your profession has specific rules regarding insolvency. If you’re in a position of financial trust or responsibility, or if you’re a licensed professional, it’s crucial to understand the potential implications of a consumer proposal on your career. Always consult with a professional to make an informed decision.

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