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Quick and Easy Guide to Labor & Employment Law: Kentucky

This state-specific guide covers labor and employment case law, statutes, rules, and regulations that HR professionals and clients often encounter or have questions about in Kentucky.

At-Will Employment

The Kentucky employer/employee relationship is governed by the terminable-at-will doctrine. This means that the employer may discharge an employee with or without cause, and with or without notice. Grzyb v. Evans, 700 S.W.2d 399 (Ky. 1985). The Kentucky Supreme Court recognizes a narrow exception to the terminable-at-will doctrine, which is when the discharge violates a fundamental, well-defined public policy that is rooted in a constitutional or statutory provision. Id. This exception applies only where the alleged reason for discharge is explicitly prohibited by legislature, was for the employee's failure or refusal to violate a law in the course of employment, was for an employee's exercise of a right conferred by well-established legislative enactment, or was for discriminatory reasons. Further, the discharge will only violate public policy if the legislatively conferred right has an employment-related nexus. Id. Some examples of discharges that violate Kentucky public policy are firing an employee who has filed claims or a diagnosis of coal-related pneumoconiosis; whose wages have been subject to a garnishment order; or who has asserted collective bargaining rights. Ky. Rev. Stat. § 342.197, Ky. Rev. Stat. § 427.140, Ky. Rev. Stat. § 336.130.

In addition, the parties may alter the at-will employment context by explicitly stating in a contract of employment that it is only terminable pursuant to its express terms, such as "for cause." Shah v. American Synthetic Rubber Corp., 655 S.W.2d 489 (Ky. 1983).

Right-to-Work Laws

Kentucky is a right-to-work state. An employer cannot deny nor condition an employee's right to work upon that employee's membership or non-membership in any labor union or labor organization. Ky. Rev. Stat. § 336.130. An employer also cannot deny employment due to an individual's payment of or refusal to pay labor union dues or other fees to a labor organization. Id.

Immigration Verification

Kentucky places no additional employment verification procedures on employers beyond Federal I-9 compliance. There is no requirement to use E-Verify under Kentucky state laws.

Drug Testing

Employers are free to implement drug-testing policies at their own discretion. Employers are not expressly prohibited from discharging at-will employees who test positive on random drug tests. Kentucky does, however, offer a discount on workers' compensation insurance premiums if the employer becomes certified by the Kentucky Department of Workers Claims as a drug-free workplace. Ky. Rev. Stat. § 351.186. The requirements for becoming a certified drug-free workplace are listed in Section 803 Ky. Admin. Reg. 25:280. Records of drug or alcohol test results received by the employer shall be confidential communications and shall not be disclosed by the employer to any party unless a written release of information is granted and signed by the employee or the release is ordered by a court of competent jurisdiction. Id. The employer must pay the costs of drug testing that is a condition of employment. Ky. Rev. Stat. § 336.220.

Kentucky state law requires miners and certain law enforcement personnel to pass a drug-screening test before they start employment. Ky. Rev. Stat. §§ 351.182; 15.3971.

Under Kentucky's workers' compensation law, an employer is not liable for compensation in cases of injury, occupational disease, or death of the employee if the employee willfully intended to injure or kill themself or another. Ky. Rev. Stat. § 342.610(3).

For workers' compensation, if an employee fails a drug test, it is presumed that the illegal substance caused the injury and liability for compensation will not apply. Ky. Rev. Stat. § 342.610(4). This presumption is rebuttable if the employee shows that the substance did not cause an impairment or the impairment did not cause the injury. Further, reporting to work under the influence of alcohol or drugs, or consuming alcohol or drugs on employer's premises during working hours, is misconduct that can be used to deny unemployment benefits. Ky. Rev. Stat. § 341.370.

Effective July 15, 2020, a Kentucky employer may hire a person who has failed a drug screen related to employment, while also being protected from any liability for a civil action alleging negligent hiring, retention, or supervision for a negligent act by the employee as a result of the employee's substance use disorder, as long as the employer complies with the requirements set out in Ky. Rev. Stat. § 222.215.

Jury Duty Leave

It is unlawful for an employer to persuade or attempt to persuade any employee to avoid jury service, intimidate or threaten any juror in that respect, or remove or otherwise subject an employee to adverse employment action as a result of jury service if the employee provides reasonable notice of their absence. It is also unlawful for an employer to require or request an employee to use annual, vacation, or sick leave for time spent on responding to a summons for jury duty. Ky. Rev. Stat. § 29A.160. Employers are not required to pay wages while an employee is on jury duty.

Voting Leave

Employees who are eligible to vote are entitled to a reasonable amount of time off of not less than four hours to cast a ballot on the day of the election, or request an application for or execute an absentee ballot, if they request leave at least one day in advance. Ky. Rev. Stat. § 118.035. The employer may specify the hours during which an employee may leave work to vote.

Parental Leave

The State of Kentucky does not require private employers to provide parental leave to its employees. However, the employer is subject to the federal Family Medical Leave Act and its requirements.

Other Leave

The State of Kentucky does not require private employers to offer to employees paid vacation or sick leave. However, employers are subject to the federal Family Medical Leave Act and its requirements.

Whistleblower Laws

The Kentucky Whistleblower Act protects public employees from reprisal for making a good faith report about suspected violations of the law or mismanagement, waste, fraud, abuse of authority, or a substantial and specific danger to public health or safety. Ky. Rev. Stat. § 61.102.

Smoking Laws

An employer cannot refuse to hire, discharge, or otherwise discriminate against an individual with respect to the terms and conditions of employment because the individual is a smoker or nonsmoker, as long as the person complies with any workplace policy concerning smoking. Ky. Rev. Stat. § 344.040. The employer cannot require that any employee abstain from using tobacco products outside the course of employment. Id. However, it is not an unlawful practice to offer incentives or benefits to employees who participate in smoking cessation programs nor is it an unlawful practice for there to be a difference in employee contribution rates for smokers and nonsmokers in relation to an employer-sponsored health plan. Id.

The statutory protection against discrimination for smoking only applies to employers who have eight or more employees within Kentucky in each of 20 or more calendar weeks in the current or proceeding calendar year. Ky. Rev. Stat. § 344.030.

Break Time to Express Milk

Employers with 15 or more employees within Kentucky in each of 20 or more calendar weeks in the current or proceeding calendar year must make reasonable accommodations to any employee with limitations related to pregnancy or childbirth, including the need to express breast milk. Ky. Rev. Stat. §§ 344.030; 344.040. The reasonable accommodation may include a private space that is not a bathroom in which to express breast milk. Ky. Rev. Stat. § 344.030. The employer does not have to provide an accommodation if it can demonstrate that it would impose an undue hardship on the employer's business. Ky. Rev. Stat. § 344.040.

Rest Breaks

All employers, except those who are under the Federal Railway Labor Act, must give employees an opportunity for a rest period of at least 10 minutes during each four hours worked. Ky. Rev. Stat. § 337.365. Further, the rest period must be in addition to the regularly scheduled lunch period and no reduction in compensation can be made for hourly or salaried employees. Id.

Meal Breaks

All employers, except those who are under the Federal Railway Labor Act, must give their employees a reasonable period for lunch. Ky. Rev. Stat. § 337.355. The lunch break should be as close to the middle of the employee's work shift as possible, and the employee cannot be required to take a lunch period sooner than three hours after the work shift begins or more than five hours after the shift begins. Id.

Minimum Wage, Overtime, and Wage Recordkeeping

Kentucky's minimum wage is $7.25 per hour. Ky. Rev. Stat. § 337.275. Employers must still comply with federal wage laws and regulations. If the federal minimum hourly wage is increased above the Kentucky state minimum hourly wage, the Kentucky minimum wage will be increased to the same amount. Id. An employer can pay tipped employees $2.13 per hour as long as the employee's tips bring the total hourly wage up to the state minimum wage.

Provisions governing overtime pay can be found at Ky. Rev. Stat. § 337.285. Generally, if an employee works more than 40 hours per week, the employee must be compensated at a rate of one and one-half times the regular rate of pay at which they are employed. This does not apply to employees of retail stores engaged in work connected with selling, purchasing, and distributing merchandise, wares, goods, articles, or commodities; or employees of restaurants, hotels, and motels. Id.

Every employer shall keep a record of: (a) the amount paid each pay period to each employee; (b) the hours worked each day and each week by each employee; and (c) such other information as required. Ky. Rev. Stat. § 337.320. The records must be kept on file for at least a year after entry and must be furnished to any authorized representative on demand. Id.

Final Payments

An employer must pay any employee who leaves or is discharged from employment all wages or salary in full earned by the employee no later than the next normal pay period after the date of dismissal or voluntary leaving of 14 days after such date, whichever occurs last. Ky. Rev. Stat. § 337.055.

Unemployment Insurance

Unemployment insurance benefits provide income to individuals who have lost work through no fault of their own. The benefits are intended to partially offset the loss of wages while an unemployed worker searches for suitable work or until an employer can recall the employee to work. Nothing is deducted from the employee's wages to pay for this coverage. Unemployment benefits are administered by the Kentucky Office of Employment and Training (OET). Additional information regarding the benefits may be accessed at www.kewes.Ky.gov/.

Workers' Compensation

The Kentucky Workers' Compensation Act, Ky. Rev. Stat. § 342.0011, et seq., applies to every employer in Kentucky with one or more covered employees. Certain employees, such as agricultural workers and employees of religious institutions, are not covered by the act. Ky. Rev. Stat. § 342.650. Covered employees who suffer injuries and/or occupational diseases arising out of and in the course of their employment may be eligible to receive several types of benefits under the Act. Under the Act, the employee must give notice of the accident to the employer as soon as practicable. Ky. Rev. Stat. § 342.185.

The Act is administered by the Kentucky Department of Workers' Claims; additional information regarding the Act may be accessed at labor.Ky.gov/comp/Pages/default.aspx.

Finally, an employer may not discriminate against an employee in any manner for filing or pursuing a lawful workers' compensation claim Ky. Rev. Stat. § 342.197. An employee may have a cause of action for retaliatory discharge even if they have not yet filed a formal workers' compensation claim. Bishop v. Manpower, Inc. of Cent. Kentucky, 211 S.W.3d 71, 75 (Ky. Ct. App. 2006). To succeed on the claim of retaliation, the employee must prove that the pursuit or filing of the workers' compensation claim was a substantial and motivating factor but for which the employee would not have suffered an adverse employment action. Id.

Child Labor

Generally, 14 years is the minimum age for employment under Kentucky state law. Ky. Rev. Stat. § 339.220. Minors who are 14 years of age or older are permitted to work, subject to various restrictions on the type and amount of work. Ky. Rev. Stat. § 339.230. Any minors permitted to work cannot work more than five hours continuously without a lunch break of at least 30 minutes. Ky. Rev. Stat. § 339.270. Minors must also receive a rest period of at least 10 minutes during each four hours worked, in addition to the regularly scheduled lunch period, with no reduction in compensation. Id.

Gun Laws

Under Kentucky law, an employer cannot prohibit any person who is legally entitled to possess a firearm from possessing a firearm in a vehicle on the employer's property. Ky. Rev. Stat. § 237.106. A firearm may be removed from the vehicle in the case of self-defense, defense of another, defense of property, or as authorized by the owner of the property. Id. However, an employer is not liable for wrongful termination for firing an employee who moved a firearm out of the trunk of their vehicle and into a co-worker's vehicle, because the statute only permits the removal of the gun from the vehicle for defense. Holly v. UPS Supply Chain Solutions, Inc., CASE NO. 3:13-CV-980-DJH-CHL (W.D. Ky. May 19, 2015).

Additional Laws and Regulations

Kentucky Civil Rights Act

The Act, Ky. Rev. Stat. § 344.010, et seq., mimics Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act of 1990, as amended, in that it prohibits discrimination because of an individual's race, color, religion, national origin, sex, or disability. Further, the Act prohibits employment discrimination against individuals aged 40 and older. Ky. Rev. Stat. § 344.040. The Act covers public and private employers with eight or more employees, except that disability discrimination covers employers with 15 or more employees. Ky. Rev. Stat. § 344.030.

Kentucky Equal Pay Law

Kentucky law, Ky. Rev. Stat. § 337.420, et seq., mimics the Equal Pay Act of 1963 in that it prohibits discrimination between employees in the same establishment, on the basis of sex, in their compensation for comparable work.

Reporting Requirements

Employers are required to provide the Cabinet for Health and Family Services with a report that contains the name, address, and Social Security number of each newly hired employee or employees who are permitted to return to work after being furloughed, laid off, or separated. Ky. Rev. Stat. § 405.435. In addition, the employer must provide the employer's name, address, and — if the employer has been assigned one — federal and state employer identification numbers (EINs). Id. The information must be provided within 20 days of the hiring or return to work of the employee. Id.

References

Kentucky recognizes a tort cause of action for negligent hiring. An employer can be held liable when its failure to exercise ordinary care in hiring or retaining an employee creates a foreseeable risk of harm to a third person. Oakley v. Flor-Shin, Inc., 964 S.W.2d 438, 441 (Ky. Ct. App. 1998). Kentucky law immunizes employers from civil liability for disclosing information about a current or former employee to a prospective employer in most situations. An employer who provides information related to the professional conduct of a current or former employee to a prospective employer of that employee at the request of that employee or prospective employer is immune from civil liability arising out of the disclosure unless (1) the employer disclosed information it knew was false, with reckless disregard of whether it was true or false, or with intent to mislead the prospective employer; or (2) the disclosure constitutes an unlawful discriminatory practice under Ky. Rev. Stat. Chapter 344. Ky. Rev. Stat. § 411.225.

Medical Examination

It is unlawful for any employer to require any employee or applicant to pay the cost of a medical examination or of furnishing any records required by the employer as a condition of employment. Ky. Rev. Stat. § 336.220.

The Kentucky Equal Opportunities Act prohibits employment practices that discriminate based on physical disability, including acquired immunodeficiency syndrome (AIDS) and human immunodeficiency virus (HIV) infection. Ky. Rev. Stat. § 207.130, et seq. Both laws cover public employers and private employers with eight or more employees, except that disability discrimination under the Kentucky Civil Rights Act covers employers with 15 or more employees. KY Rev. Stat. § 344.030.

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Guide last updated October 2022.

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