Overview

Capital
Frankfort
Currency
United States Dollar (USD)
Date Format
mm/dd/yyyy

Taxes

Employer
6.20% - Social
1.45% - Medicare Rate
Up To 3.3% - State Taxes
Employee

Minimum Wage

General

Minimum wage is $7.25 per hour.

VAT

General

The state sales tax is 6%.

Mandatory Benefits

Pension Fund

Employer: contributes a percentage of the total payroll per month for the employees pension funds. The contribution percentage is not specified.
Employee: contributes a percentage of the total payroll per month for pension funds. The contribution percentage is not specified.

Social Security

As of 2011, after the Tax Relief, Unemployment Insurance Re-authorization and Job Creation Act of 2010, the Social Security tax rate is 4.2 percent of an employee's wages. In addition, there is a limit to the amount of wages that are subject to Social Security taxes. In 2016, the taxable wage base is be $118,500.

Termination

Termination Process

Kentucky follows “employment at will” doctrine which means both the employee and employer are allowed to terminate the employment at any given time without a reason Therefore at the time of termination, the employer much pay all the necessary wages up to the day of termination.

 

 

Advance Notice

While there is no official period required, the general practice is is 2 weeks.

Severance Pay

Kentucky law does not either require or prohibit severance payments. It depends on the employer’s agreement with the employee.