What Is Minimum Wage in Kentucky? Tipped Pay, Overtime, and Exemptions

The Kentucky minimum wage is $7.25 per hour. It has sat at that rate since 2009 because state law locks Kentucky’s floor to the federal minimum, and Congress has not raised the federal rate. Unless Congress acts or the Kentucky General Assembly passes its own increase, $7.25 is what covered workers must be paid in 2026.¹²

KRS 337.275 also includes an automatic escalator. If the federal minimum ever climbs above the state rate, Kentucky’s rate rises to match on the same effective date, with no separate action from the legislature needed.

What Tipped Workers Must Be Paid

Servers, bartenders, and other workers who customarily receive more than $30 a month in tips can be paid a cash wage as low as $2.13 per hour. That number is tied to the federal tipped wage under 29 U.S.C. § 203(m), which has been $2.13 since August 1996.³

The catch: tips plus cash wage have to average at least $7.25 for every hour of the workweek. If a slow week leaves you short, the employer has to make up the difference.⁴ Before the employer can use the tip credit at all, you have to be told how the system works, and you have to keep the tips you earn.

Tip pooling is allowed when employees voluntarily agree to split tips among themselves.¹ Federal law draws a firm line around who can share: employers, managers, and supervisors cannot keep any portion of employee tips, and managers are barred from receiving anything out of a tip pool. A manager may only keep a tip a customer gave specifically for service the manager personally and solely provided.⁴

Youth Training Wage

Workers under 20 can be paid $4.25 per hour during their first 90 consecutive calendar days with an employer under federal law.⁵ After the 90 days end or the worker turns 20, whichever comes first, the full $7.25 rate applies. Kentucky does not have its own separate youth rate, so federal rules govern. Employers are not allowed to displace existing workers to bring in someone younger at $4.25.

Who Isn’t Covered

Several categories of Kentucky workers fall outside the minimum wage statute entirely. The exemptions in KRS 337.010 are broad, and some of them cover jobs that look like ordinary hourly work.⁶

Agricultural workers, including those employed in crop cultivation, livestock, dairying, and harvesting.
Domestic workers in a private home, such as housekeepers, babysitters, and elder companions. Homes staffing more than one domestic worker may fall into coverage.
Executive, administrative, and professional employees paid on a salary basis of at least $684 per week ($35,568 annually), under the federal standard Kentucky follows.⁷
Employees of retail stores, service businesses, hotels, motels, and restaurants whose average annual gross volume over the preceding five years is under $95,000.
Learners, apprentices, workers with disabilities, sheltered workshop employees, and students, when the commissioner has issued a certificate authorizing a lower rate.

Exempt status turns on the actual work, not the job title. Being called a “manager” on paper does not make someone exempt if the daily tasks are the same as any other hourly employee’s.

Overtime at $7.25

KRS 337.285 requires one and a half times the regular rate for every hour over 40 in a workweek. At the state minimum, overtime works out to $10.88 an hour. There is no ceiling on how many hours a week an employer can schedule; the premium just has to be paid on anything past 40.⁸

Kentucky’s overtime law carves out some of the state’s largest workforces. Under KRS 337.285(2) and the implementing regulation at 803 KAR 1:061, these workers are not entitled to state overtime even when they earn minimum wage:⁹

Retail store employees doing work connected with selling, purchasing, or distributing merchandise.
Restaurant, hotel, and motel employees.
Workers providing 24-hour residential care to dependent or neglected children in licensed nonprofit facilities.
In-home companions for the elderly or convalescing employed through a third-party agency.

If you work in retail or hospitality in Kentucky and routinely clock more than 40 hours, state law may not give you time and a half. Federal FLSA overtime may still apply depending on the employer’s annual revenue and whether the business engages in interstate commerce.

Why No Kentucky City Pays More

Louisville tried in 2014, passing an ordinance raising its local minimum wage above $7.25. The Kentucky Supreme Court struck it down in Kentucky Restaurant Association v. Louisville/Jefferson County Metro Government (2016), holding that the ordinance conflicted with the comprehensive wage scheme in KRS Chapter 337.¹⁰ The $7.25 floor applies uniformly across the state. No Kentucky city or county can set its own higher rate.

If You’re Being Underpaid

You can file a complaint with the Kentucky Division of Wages and Hours through the online portal at apps.labor.ky.gov, by mailing a paper form to the Frankfort office, or by calling (502) 564-3534. You can also file separately with the federal Wage and Hour Division of the U.S. Department of Labor, which enforces the FLSA independently.

The money at stake is often larger than people assume. KRS 337.385 lets an employee recover the full amount of unpaid wages plus an equal amount in liquidated damages, which effectively doubles the back pay. The court can add attorney’s fees and costs on top.¹¹ An employer who shows the underpayment was a good-faith mistake with reasonable grounds for believing it was complying may get the liquidated damages reduced or eliminated at the court’s discretion. In forced labor cases, the statute requires punitive damages of at least three times the unpaid wages.

Federal law protects you from being punished for complaining. Under 29 U.S.C. § 215(a)(3), an employer cannot fire you, cut your hours, or retaliate against you for reporting a wage violation or taking part in a related proceeding.¹² Retaliation becomes its own separate claim.

1
Justia. Kentucky Code 337.275 – Minimum Wage
2
Federal Reserve Economic Data (FRED). Federal and State Minimum Wage Rates
3
Office of the Law Revision Counsel. 29 USC 203 – Definitions
4
U.S. Department of Labor. Fact Sheet 15 – Tipped Employees Under the Fair Labor Standards Act (FLSA)
5
Office of the Law Revision Counsel. 29 USC 206 – Minimum Wage
6
Justia. Kentucky Code 337.010 – Definitions for Chapter
7
U.S. Department of Labor. Earnings Thresholds for the Executive, Administrative, and Professional Exemptions
8
Kentucky Legislative Research Commission. Kentucky Code 337.285 – Time and a Half for Employment in Excess of Forty Hours
9
Cornell Law Institute. Kentucky Code 803 KAR 1:061 – Overtime Pay Requirements
10
Justia. Kentucky Restaurant Assn v Louisville/Jefferson County Metro Government
11
Kentucky Legislative Research Commission. Kentucky Code 337.385 – Employers Liability – Unpaid Wages and Liquidated Damages
12
Office of the Law Revision Counsel. 29 USC 215 – Prohibited Acts