Kentucky Overtime Laws

April 10th 2024

Kentucky overtime laws, a crucial component of the broader Kentucky Labor Laws, govern the compensation and working hours for employees in Kentucky. These laws were created to protect workers by establishing guidelines for overtime pay, which is additional compensation provided to employees who work beyond a certain number of hours in a workweek.

This article will provide information to successfully navigate Kentucky’s overtime regulations, whether you’re an employer aiming for compliance or an employee defending your rights.

This article covers:

Kentucky Overtime Rates

Kentucky overtime rates refer to the specific compensation provided to employees in Kentucky for working beyond their regular working hours. In Kentucky, employees who work over 40 hours per week are entitled to overtime pay at time-and-a-half (1.5) for every additional hour worked. This is consistent with the federal Fair Labor Standards Act (FLSA).

Since the regular minimum wage in Kentucky is $7.25 per hour, this means the overtime minimum pay is $10.88 per hour. 

Kentucky overtime law also states that employees who have worked seven days in a row must be paid time-and-a-half for all hours worked on the seventh day (with a few exceptions).

Overtime Entitlement in Kentucky

According to Kentucky overtime laws, overtime pay is required for any non-exempt employees. 

Employees in non-exempt industries who make less than $684 per week ($35,568 annually) are entitled to overtime compensation.

However, an employee’s overall eligibility for overtime pay will be based on what the job duties are as well as what type of business they are in.

Read more about Overtime Exceptions and Exemptions in Kentucky.

Compensatory Time in Kentucky

Upon a written request, a non-exempt employee in Kentucky may receive the compensatory time, “comp time”, from their employer in place of overtime pay. Comp time is also provided at a rate of time-and-a-half for any hours worked above 40 per week. If an employee changes agencies, their accrued compensatory leave will be carried over to the new agency.

Overtime for Tipped Employees in Kentucky

In Kentucky, the overtime rate for tipped employees is 1.5 times their regular wage for every overtime hour worked. However, tipped employees are subject to a lower minimum wage of $2.13 per hour instead of the regular state minimum wage. 

The use of a “tip credit” system, which permits employers to pay tipped employees a reduced minimum wage, is permitted by both state and federal legislation. However, it is important to note that tipped workers must accumulate enough tips to total up to the regular minimum wage of $7.25. If their wage, including tips earned, falls below the regular minimum wage, their employer must make up the difference.

That being said, an employer cannot include that tip credit in the calculation of overtime pay. This means that the entire minimum wage (following the Kentucky minimum wage which is $7.25) must be taken into account when calculating overtime pay.

Overtime for Salaried Employees in Kentucky

The overtime pay for salaried employees in Kentucky is determined following the federal Fair Labor Standards Act (FLSA).

Under 29 C.F.R 778.113 for salaried employees, it is necessary to consider two aspects when determining overtime.

Weekly Salary

If an employee is paid a weekly salary, the regular hourly rate used to calculate overtime pay is determined by dividing the salary by the number of hours the salary is intended to cover. 

For example, if an employee earns a salary of $350 for a 35-hour workweek, the regular rate of pay is $10/hour ($350 divided by 35 hours). When that employee works overtime, they are entitled to receive $10/hour for the first 40 hours and $15/hour (1.5 overtime rate) for each additional hour. 

Salary for Periods Other Than Workweek

When a salary covers a period longer than a workweek, such as a month, it needs to be converted to its equivalent weekly wage. To do this, a monthly salary is multiplied by 12 (months per year) and divided by 52 (weeks per year). Once the weekly wage is determined, the regular hourly rate of pay can be calculated.

For simpler understanding:

(Monthly salary x 12 months) / 52 weeks = Weekly Wage

Weekly Wage / 40 hours (per workweek) = Hourly Rate

For example, if an employee has a regular monthly salary of $1,560 for a 40-hour workweek, their regular rate of pay would be $9/hour (calculated based on the formula given above). 

It’s important to note that regulations also allow determining the regular rate by dividing the monthly salary by the number of working days and then by the number of hours in a normal workday, as long as the resulting rate is not lower than the minimum wage required by law.

Fluctuating Workweek (FWW)

Under 29 C.F.R 778.114, the Fluctuating Workweek (FWW) method can be utilized by employers when employees have varying hours of work each week and receive a fixed salary as compensation for any hours worked. In such cases, the regular rate of pay is determined by dividing the salary amount by the number of hours worked in the workweek.

To comply with the overtime pay requirements, the employer must provide a rate of time-and-a-half (1.5) for each overtime hour worked by the employee. Since the employee’s work hours fluctuate weekly, the regular rate needs to be calculated separately based on the actual hours worked each week.

Calculating Overtime with Commission in Kentucky

In Kentucky, employees who may receive commissions are still entitled to overtime pay although the rate may differ. If an employee receives weekly commissions, the commission will be combined with the employee’s weekly wage. The total amount is then divided by the total number of hours worked in the week to determine the regular hourly rate for that week. For any hours worked beyond 40 per week, the employee must be paid additional compensation at a rate of half of the regular hourly rate.

For example, let’s say an employee works 45 hours a week and receives a wage of $400 for that week and also receives an extra $50 in commissions. We need first to calculate the regular hourly rate: 

First, add the weekly wage and commission to get the total earnings for the week.

$400 + $50

= $450

Next, divide that amount by the total number of hours worked in the week.

$450 / 45 hours

= $10 per hour (regular hourly rate)

To get the overtime rate for commissioned employees, take the regular hourly rate and halve it.

$10 / 2

= $5 (overtime hourly rate)

Since the employee worked an extra 5 hours in the week, that makes his overtime compensation $25 ($5 x 5 hours).

The amount will vary according to the hours worked, hourly rate, and commission earned.

Overtime Exceptions and Exemptions in Kentucky

The state of Kentucky follows the federal overtime rules, which exempt white-collar employees from receiving overtime pay. To be exempt, these employees must earn a minimum of $684 per week and fall into one of four categories: administration, executive, professional, or outside sales.

The Kentucky overtime law completely exempts many employees from receiving overtime pay, which includes:

  • Immediate family of the employer
  • External salespeople
  • Computer-related workers
  • Independent contractors
  • Transportation workers
  • Domestic workers
  • Learners and students
  • Disabled workers
  • Taxi drivers
  • Agricultural and farm laborers, 
  • Employees at seasonal camps, 
  • Mechanics
  • Live-in employees such as housekeepers
  • Newspaper deliverers
  • Employees in certain retail stores, hotels, motels, and restaurants 

First responders, such as police officers, paramedics, and firefighters, receive specific overtime protection under the FLSA. Similarly, practical nurses and paralegals, who would typically be exempted, are granted overtime protection due to their demanding work hours, aiming to prevent employer exploitation and excessive workload.

Penalties for Not Providing Overtime Pay to Employees in Kentucky

If an employer pays less than the overtime compensation amount an employee is entitled to, that employer is legally obligated to pay that employee the full amount of unpaid overtime wage. This amount is calculated after deducting any already-made payments by the employer. 

Additionally, an employer may be required to pay an equal amount as liquidated damages, as well as cover the costs and reasonable attorney’s fees approved by the court. 

Legal Cases Relating to Overtime Compensation in Kentucky

Below, we present law cases relating to fair overtime compensation for employees in Kentucky: 

1. K-9 Officer Handler Seeks Overtime Compensation for Time Spent Taking Care of Dog

In the case of Tomlinson v. Trigg County, David Tomlinson filed a lawsuit against Trigg County, Kentucky, and Trigg County Sheriff Aaron Acree for failure to provide overtime compensation. Tomlinson worked as a deputy sheriff for the Trigg County Sheriff’s Office (TCSO). During his employment, Tomlinson served as a K-9 Officer handler and took care of his K-9 partner, Krator, at his home. Tomlinson claimed that he was not paid overtime wages for the overtime hours he spent caring for the dog.

The defendants, Trigg County and the Trigg County Sheriff, sought to dismiss the case and argued that the court lacked authority over this case because the Fair Labor Standards Act’s (FLSA) wage and hour provisions could not be enforced against a state entity. Tomlinson agreed with that argument and subsequently filed a motion to amend his complaint, changing the allegations against the Trigg County Sheriff from his official capacity to his individual capacity. Tomlinson also added former Sheriff Jason Barnes as another “defendant” in his individual capacity.

The court decided to favor Tomlinson’s motion to amend his complaint and allowed the addition of Sheriff Barnes as well. The court stated that it should freely grant leave to amend when justice required it. Although the motion to amend was technically filed outside the time limit, the court considered it a technical mistake and still granted it.

In conclusion, the court granted Tomlinson’s motion to amend the complaint. The court also partially granted Trigg County’s motion to dismiss by dismissing the initial complaint made against Trigg County and the Trigg County Sheriff in their official capacity.

Key lessons from this case:

  • Employers, including government entities, may raise defenses under the FLSA to contest claims of overtime violations. It is important for employees to understand and address these defenses.
  • Public employees, even when acting on behalf of a public agency employer, can be held individually liable under the FLSA for violations related to overtime compensation.
  • Courts may grant motions to amend overtime pay complaints if it serves the interests of justice for the employee.
2. Employee and Employer Motioned for Separate Summary Judgment in Overtime Pay Lawsuit

In the case of Henderson v. Pieratt’s, Inc., Herman Henderson, filed a lawsuit against his former employer, Pieratt’s, for violating the Fair Labor Standards Act (FLSA) and the Kentucky Wage and Hour Act (KWHA). Henderson alleged that he did not receive any additional compensation for working more than 40 hours per week. 

Henderson was a regular employee at Pieratt’s Warehouse and was later promoted to the position of delivery crew chief. Pieratt’s implemented a compensation scheme for delivery personnel that included an hourly rate, commission payments, and bonuses, However, Henderson claimed that he did not receive overtime compensation as required. Pieratt’s scheme did not explicitly address overtime payment for crew chiefs. 

Both Henderson and Pieratt’s had filed motions for partial summary judgment. Pieratt’s sought partial summary judgment on the issue of liability whereas Henderson sought partial summary judgment on the issue of wage liability under FLSA and KWHA. 

The court denied both motions for partial summary judgment and decided that there were still disputes of material facts that needed to be resolved at trial. The denial indicated that neither side was entitled to judgment at this stage. The case proceeded to trial to determine the issues and appropriate remedies for the alleged violations. 

The final ruling of the case is undetermined.

Key lessons from this case:

  • Employers should clearly define and communicate their compensation policies, including how overtime is calculated and paid to employees.
  • Compensation schemes should explicitly address overtime payment for different positions, including roles such as crew chiefs or supervisors, to avoid potential violations of overtime laws.
  • Lawsuits involving overtime disputes may proceed to trial when genuine disputes of material facts exist, indicating that a judgment as a matter of law is not appropriate.
3. Home Healthcare Providers Owed Overtime Compensation for Additional Unrecorded Work Time

In the case of Mitcham v. Intrepid USA, Inc., Tina Mitcham filed a lawsuit on behalf of herself and similarly situated individuals against Intrepid USA and F.C. of Kentucky, who were conducting business as Intrepid USA Healthcare Services (Intrepid). Mitcham, and the other individuals, were non-exempt home health workers employed by Intrepid at any of their Kentucky locations. Mitcham and the other employees would provide in-home healthcare services to patients.

Mitcham alleged that their pay was computed on a fee-per-visit basis and that they were not properly compensated for all their work, including compensable travel time and other unrecorded work time, such as time spent charting for patients outside of their in-home visits.

A settlement agreement was reached between the employees and Intrepid that resolved the claims. The agreement provided for an aggregated gross amount of $23,000 paid to the complainants. The amount was based on a determination of overtime compensation, including the alleged unrecorded compensable travel time and other unrecorded work time. The settlement also included an amount of $142,500 in attorney’s fees and expenses. In exchange for the payments, Mitcham and the other employees were to release Intrepid from their unpaid wage claims.

The court concluded that the settlement agreement was fair and reasonable. The court approved the settlement but wanted to address the attorney’s fees amount separately. The final ruling on attorney’s fees is undetermined.

Key lessons from this case:

  • Lawsuits can be filed on behalf of individuals and similarly situated individuals who believe they are owed unpaid overtime pay under the FLSA and state laws.
  • Settlement agreements often involve a release of claims, where an employee may agree to release an employer from further liability while also receiving overtime back wages and additional damages in return.
  • Overtime compensation calculations for home healthcare service providers may not be so straightforward as patients may need additional care outside of working hours.

Learn more about Kentucky Labor Laws through our detailed guide.

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