AN ACT relating to employment.

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AN ACT relating to employment. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF KRS CHAPTER 337 IS CREATED TO 3
READ AS FOLLOWS: 4
As used in Sections 1 to 3 of this Act, unless the context requires otherwise: 5
(1) "Constructive discharge" means the resignation of an employee because of a 6
working condition or condition s that an objective and reasonable person would 7
find intolerable, and does not include resignation because of an employer's 8
refusal to promote the employee or improve wages, responsibilities, or other terms 9
and conditions of employment; 10
(2) "Discharge" mea ns termination of employment and includes a constructive 11
discharge as defined in subsection (1) of this section, resignation, elimination of 12
the job, layoff for lack of work, failure to recall or rehire, and any other cutback 13
in the number of employees; 14
(3) "Fringe benefits" means the value of any employer -paid vacation leave, sick 15
leave, medical insurance plan, disability insurance plan, life insurance plan, and 16
pension or retirement benefit plan in force on the date of the termination; 17
(4) "Good cause" means reasonable job -related grounds for dismissal based on a 18
failure to satisfactorily perform job duties, disruption of the employer's operation, 19
or other legitimate business reason; 20
(5) "Lost wages" means the gross amount of wages that woul d have been reported to 21
the Internal Revenue Service as gross income on form W -2 and includes 22
additional compensation deferred at the option of the employee; and 23
(6) "Public policy" means a policy in effect at the time of the discharge concerning 24
the publi c health, safety, or welfare established by constitutional provision, 25
statute, or administrative regulation. 26
SECTION 2. A NEW SECTION OF KRS CHAPTER 337 IS CREATED TO 27
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READ AS FOLLOWS: 1
(1) A discharge of an employee is wrongful if: 2
(a) It is in retaliation for the employee's refusal to violate public policy, for 3
reporting a violation of public policy, or for reporting what the employee 4
reasonably believes is a violation of public policy; 5
(b) The discharge is not for good c ause and the employee has completed the 6
employer's probationary period of employment; or 7
(c) The employer violated the express provisions of its own written personnel 8
policy. 9
(2) (a) During a probationary period of employment not to exceed nine (9) months, 10
the employment may be terminated at the will of either the employer or the 11
employee on notice to the other for any reason other than reasons 12
prohibited by law or no reason. 13
(b) If an employer does not establish a specific probationary period or provide 14
that there is no probationary period prior to or at the time of hire, there is a 15
probationary period of six (6) months from the date of hire. 16
SECTION 3. A NEW SECTION OF KRS CHAPTER 337 IS CREATED TO 17
READ AS FOLLOWS: 18
(1) Any employer who commits a wrongful discharge shall be liable to the employee 19
or employees in the amount of their lost wages and fringe benefits for a period 20
not to exceed four (4) years from the date of discharge, together with interest on 21
the lost wages a nd fringe benefits. Interim earnings, including amounts the 22
employee could have earned with reasonable diligence, shall be deducted from 23
the amount awarded for lost wages. Before interim earnings are deducted from 24
lost wages, there shall be deducted from t he interim earnings any reasonable 25
amounts expended by the employee in searching for, obtaining, or relocating to 26
new employment. 27
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(2) The employee shall recover punitive damages as allowed by KRS 411.184 and 1
411.186 if it is established by clear and convin cing evidence that the employer 2
acted toward the employee with oppression, fraud, or malice in violating Section 3
2 of this Act. 4
(3) An employee is entitled to any damages for an employer's violation of Section 2 of 5
this Act except as provided in subsections (1) and (2) of this section, provided that 6
nothing in Sections 1 to 3 of this Act shall limit or diminish an employee's right 7
to any form of damages or relief under any other statute or common law. 8
(4) An action to recover any liability established by th is section may be maintained in 9
any court of competent jurisdiction by any one (1) or more employees for and on 10
behalf of himself, herself, or themselves and other employees similarly situated. 11
(5) An action filed for violation of Section 2 of this Act sha ll be filed no later than 12
one (1) year after the date of discharge. 13
(6) (a) If an employer maintains written internal procedures under which an 14
employee may appeal a discharge within the organizational structure of the 15
employer, the employee shall first ex haust those procedures prior to filing 16
an action in court pursuant to Sections 1 to 3 of this Act; 17
(b) If an employer's internal procedures or remedies are not completed within 18
ninety (90) days from the date the employee initiates the internal 19
procedures, then the employee may file a court action pursuant to Sections 20
1 to 3 of this Act; and 21
(c) The limitation in subsection (5) of this section is tolled until the employer's 22
internal procedures are exhausted, except that in no case may the 23
provisions of the e mployer's internal procedures extend the limitation more 24
than one hundred twenty (120) days. 25