Indiana Labor Laws

In the US, the federal Fair Labor Standards Act (FLSA) sets laws in place to manage the time spent by employees in the workplace, safeguarding their rights and guaranteeing fair pay for their efforts.

Time management laws in Indiana follow FLSA standards by setting a minimum hourly wage and requiring employers to keep an accurate record of their employees’ working hours. Overtime is pegged at 1.5 times the regular hourly rate for workers who exceed 40 hours a week. 

Employers who contravene these laws can face severe legal ramifications, including fines, back pay, and damages. If workers feel their employer has violated their wage rights, they can file a complaint with the Indiana Department of Labor for investigation and legal action.

Employers in Indiana with at least six employees are prohibited from discriminating against job applicants during the hiring process based on certain protected characteristics as per the Indiana Civil Rights Act. These include: 

Additionally, the Act also protects employers from baseless charges of employment discrimination. However, this law does not apply to any non-profit organizations, including associations that exist for religious or fraternal reasons, or any educational institution related to a church or religious organization.

Indiana is a right-to-work state. This means that it is unlawful for an employer to make an employee join or leave a labor union, or pay union membership fees as a prerequisite to employment. Moreover, under Indiana law, unions must obtain written consent from employees before charging any representation fees.

Indiana also observes the “employment-at-will” policy, which means that an employment contract can be terminated by either the employee or employer for any reason, at any time, without notice or explanation. 

However, an employee cannot be terminated at will for asserting a statutory right—such as filing a workers’ compensation claim—or if the employer has made explicit promises of continued employment or job security.

After termination, the employer must provide the employee with their final payment on the next scheduled payday. If the employee leaves the job and the employer is unaware of their whereabouts, the employer is obligated to either pay the employee within ten days of a final payment demand or as soon as they receive an address where the employee’s wages can be sent.

In Indiana, some important labor laws that govern employment relations also include:

• Health Insurance Continuation Laws: Employees and their dependents in Indiana can continue their health insurance coverage for 18 to 36 months through the Consolidated Omnibus Budget Reconciliation Act (COBRA).COBRA applies if an employee loses employment as a result of termination, a significant reduction in work hours, legal separation, divorce, or loss of dependent child status. Note that an employee covered by COBRA can be responsible for paying the plan’s full premium amount.
• Workplace Safety Laws: The Indiana Occupational Safety and Health Administration (IOSHA) oversees hazardous substance management in work environments and sets training standards for handling dangerous conditions. Indiana’s workplace safety laws apply to most public and private sector establishments in the state. The department has two divisions; IOSHA’s Safety Compliance team inspects workplaces for physical hazards from machinery and equipment that can cause injuries like cuts, broken bones, or worse. The Health Compliance team investigates chemical, noise, and biological hazards that can harm hearing, memory, muscles, or cause serious illness.
• Whistleblower Protection Laws: It is illegal for employers in Indiana to take retaliatory action against workers who engage in activities protected by the Indiana Whistleblower Protection Unit. Prohibited retaliatory actions may include termination, demotion, denial of overtime or promotions, denial of benefits, disciplinary action, harassment, or intimidation.
• Recordkeeping Laws: Following the FLSA, employers in Indiana are required by law to maintain employee records for up to three years. Records that are used for payroll calculations must be maintained for two years. The format or form in which these records are kept is left up to the employer. Important employee information that should be included in these records is the employee’s name, occupation, home address, sex, date of birth if under 19, the hour and day their workweek begins, total hours worked each workday and workweek, total daily or weekly straight-time earnings, regular hourly pay rate, total amount of overtime pay per workweek, any wage deductions, total wages for each pay period, date of wage payment, and the pay period covered.
• Drug Testing Laws: In Indiana, commercial drivers can be subject to drug and alcohol tests pre-employment, randomly, under reasonable suspicion, and post-accident. They can also be required to undergo testing when they return to duty after a break. Furthermore, state law requires drug testing for occupations, such as child care and home health care providers, under certain conditions.

In Indiana, the state minimum wage is the same as the federal minimum wage, which currently stands at $7.25 per hour.

As per the FLSA, any employee who earns more than $30 in tips regularly per month is a tipped worker. Tipped employees in Indiana can be paid a lower cash wage of $2.13 per hour, with the employer retaining the tip credit of $5.12. 

Tip credit is only allowed if the worker’s cash wage and earned tips equal the state minimum wage, i.e., $4.25 per hour. If not, the employer is required to make up the difference. Additionally, it is the responsibility of the employer to accurately track all tips received by employees.

In Indiana, employers can pay trainees under the age of 20 $4.25 for their first 90 days of employment, after which they must be paid the state minimum wage. Additionally, the following occupations are exempt from receiving minimum wage in Indiana:

• Minors aged under 16 
• Independent contractors with their own business and full control over their work
• People doing work unrelated to the employer’s main business.
• Commission-only employees
• People working for their own parents, child, or spouse
• Religious workers, ministers, and volunteers for religious/charitable groups
• Student nurses and funeral service apprentices in training
• Medical school graduates working as interns or residents at hospitals
• Students working at the school they attend
• People with disabilities working for nonprofits that focus on therapy or rehab
• Insurance agents and outside salespeople paid only by commission
• Workers at nonprofit camps or recreational programs
• Agricultural workers
• Executives, administrators, or professionals earning $684 weekly
• People who work less than 4 weeks in any 3-month period.
• Interstate truck drivers or transport workers covered by federal rules

Employers in Indiana can pay employees either bi-weekly or semi-monthly. Wages must be paid within ten days after the end of a pay period. 

These wages can be paid in cash or by check, money order, online transfer, or draft.  

Overtime laws in Indiana follow the FLSA, which entitles employees to additional wages if they work more than 40 hours in a workweek. This additional pay is calculated at 1.5 times the employee’s hourly wage rate.  

For minimum wage workers in Indiana, overtime wages must equal at least $10.88 per hour. Tipped employees are also entitled to $10.88 for each hour worked over 40 in a week.  

Following federal FLSA overtime regulations, if a worker earns a minimum of $684 each week (or $35,568 annually) and performs certain job duties that qualify for exemption under the FLSA, they do not receive overtime pay, even if they work more than 40 hours in a workweek. 

This typically includes occupations like:

• Executives
• Administrative employees
• Highly compensated employees earning at least $107,432 annually
• Learned and creative professionals
• Computer employees earning $27.63 per hour
• Aircraft, boat, truck, and trailer salespersons
• Airline workers
• Domestic employees residing with their employer
• Fishermen
• Seamen on American and non-American vessels
• Taxi drivers
• Local delivery drivers and their helpers
• Workers transporting fruit and vegetables
• Federal investigators
• Workers taking care of the elderly

In Indiana, there are no specific laws outlining meal or rest breaks for employees. Providing such breaks is at the discretion of the employer. 

However, if an employer chooses to provide breaks, they must follow the general break guidelines of the FLSA. A rest break lasting between five to 20 minutes is paid.

On the other hand, a meal break lasting 30 minutes or longer is not paid. Although if the employee is required to work throughout a meal break due to the nature of their job, then they must be compensated for the break. 

Indiana law requires private employers with 25 or more workers to make accommodations for nursing mothers. Specifically, they must provide a private location (not a bathroom stall) for employees to express milk during a time period when they’re not working, as well as offering cold storage for the milk during the workday. 

If the employer can’t meet this standard, they must permit the employee to bring their own portable storage device.

Employers covered by the FLSA must provide reasonably timed breaks to nursing mothers to express milk at the workplace for up to a year after a child’s brith. 

While breastfeeding breaks for public employers are paid under state law, private employers are not mandated to provide paid breaks.

The following are the leaves that employers must provide in Indiana:

• Jury Duty Leave: In Indiana, workers can take unpaid time off for jury duty without fear of repercussions from their employer only if they nform their supervisor ahead of time about their need for jury duty leave. Furthermore, employers with less than ten workers can request jury duty to be cancelled or delayed for one employee if another is still serving.
• Family and Medical Leave: As per the Family and Medical Leave Act (FMLA), Indiana workers can avail up to 12 weeks of leave without pay, following some significant life events including personal or family sickness, the birth, adoption, or foster placement of a child. While the leave is unpaid, it is job-protected.
• Family Military Leave: Employees in Indiana can take up to ten days of unpaid leave in a calendar year if they have a family member serving in the military. This leave can be taken 30 days before their active duty orders start, while they are on a leave of absence from active duty, or 30 days after their active duty orders end. However, to avail this leave, the employee must have worked for the same employer for at least 12 months and clocked at least 1,500 hours in the 12 months preceding their request to be eligible for military family leave..

The following is a list of public holidays that will be observed in Indiana for 2025:

Indiana law defines a minor as an individual under the age of 18. The minimum age of employment in Indiana is 14. 

However, minors younger than 14 can be employed to work in certain occupations, including farm work, domestic service work, golf caddying, and newspaper carrying. A minor younger than 12 can only work on a farm owned by their parent. 

Work Permits for Minors in Indiana

As of July 1, 2021, Indiana does not require minors to obtain a work permit before securing employment. Instead, employers with five or more minor employees in Indiana are required to report and track minor worker data with the Indiana Department of Labor Youth Employment System. 

Working hours for minors in Indiana are only specified for minors under the age of 16. 

For minors aged 14 and 15, work hour schedules must follow these guidelines:

• When school is in session, daily work hours cannot exceed three, and weekly work hours cannot exceed 18.
• On non-school days, minors can work up to eight hours. During summer break, weekly work hours cannot exceed 40.
• Work can only be scheduled between 7 a.m. and 7 p.m. However, a minor’s schedule can be extended until 9 p.m. between June 1 and Labor Day. 

There are no hour restrictions for minors aged 16 and 17. They can work the same hours as adult employees and do not require parental consent to work extra hours. 

Breaks for Minors in Indiana

All minors in Indiana are entitled to a break period of 30 minutes if they are scheduled to work six or more hours. This break can be provided at once or split into two.

In Indiana, minors aged 14 and 15 are prohibited by law from working in certain occupations that are deemed dangerous. These occupations include:

Minors aged 16 and 17 are not allowed to work in the following occupations: