Indiana employment rules for employers
Last verified Sep 24, 2026 · 5 verified rules · How we verify every rule
General information, not legal advice. This page is for general information only and isn’t legal, financial or tax advice. Laws vary by state and change; check the official source or talk to a qualified professional about your situation. Every rule on this page links to its official source.
Minimum wage
Indiana's minimum wage is $7.25 per hour for employers of 2 or more employees. (State Minimum Wage Laws (U.S. DOL Wage and Hour Division table, updated July 1, 2026))
What is the minimum wage?$7.25 per hourVerified Sep 24, 2026 · 2 official sources
Indiana's minimum wage is $7.25 per hour for employers of 2 or more employees. (State Minimum Wage Laws (U.S. DOL Wage and Hour Division table, updated July 1, 2026))
“Indiana Applicable to employers of 2 or more employees Basic Minimum Rate (per hour): $7.25”
“Both the federal and Indiana state minimum wage increased from $6.55 per hour to $7.25 per hour, effective July 24, 2009.”
Used in: How to hire your first employee
Paydays
How often do you have to pay?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: dol.gov.
Used in: How to hire your first employee
Meal breaks
Do adult employees get a meal break?No state ruleVerified Sep 24, 2026 · 2 official sources
No state meal break requirement for adult employees in private employment in Indiana; Indiana's break rules apply to minors only. (Minimum Length of Meal Period Required under State Law for Adult Employees in Private Sector (U.S. DOL WHD table, January 1, 2023))
“1/ The following 35 jurisdictions also have separate provisions requiring meal periods specifically for minors (when minors are covered by two provisions, employer must observe the higher standard): Alabama, Alaska, California, Colorado, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Utah, Virginia, Washington, West Virginia, Wisconsin, Guam, and Puerto Rico.”
“In general, Indiana law does not require employers to provide adult employees lunch breaks or other breaks.”
Rest breaks
Do adult employees get paid rest breaks?No state ruleVerified Sep 24, 2026 · 2 official sources
No state rest break requirement for adult employees in private employment in Indiana. (Minimum Paid Rest Period Requirements Under State Law for Adult Employees in Private Sector (U.S. DOL WHD table, January 1, 2023))
“1 States not listed do not require paid rest periods.”
“In general, Indiana law does not require employers to provide adult employees lunch breaks or other breaks.”
Final paycheck
If you fire someone, when is the last paycheck due?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: faqs.in.gov.
If an employee quits, when is the last paycheck due?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: faqs.in.gov.
Final paycheck laws by state · Final paycheck date calculator
Used in: How to fire an employee in your state · Employee no call, no show: what to do · An employee resigned: what to do next
Unused vacation (PTO) at separation
Do you have to pay out unused vacation when someone leaves?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: faqs.in.gov.
Used in: How to fire an employee in your state · An employee resigned: what to do next
Paid sick leave
Do you have to give paid sick leave?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: in.gov.
At-will employment
Yes. Indiana follows at-will employment, with these exceptions (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), quoting Hamblen v. Danners, Inc., 478 N.E.2d 926, 929 (Ind. Ct. App. 1985)):
- Public policy: Recognized, limited (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), citing Montgomery v. Bd. of Trustees of Purdue Univ., 849 N.E.2d 1120, 1128 (Ind. 2006))
- Implied contract: not verified yet (check the official source)
- Good faith and fair dealing: Not recognized (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), quoting Hamblen v. Danners, Inc., 478 N.E.2d 926, 929 (Ind. Ct. App. 1985))
Public policy exception: recognized?Recognized, limitedVerified Sep 24, 2026 · 2 official pages from the same agency
Indiana recognizes only a narrow public policy exception: an employee fired for exercising a clear statutory right (Frampton, workers' compensation) or for refusing to commit an illegal act for which the employee would be personally liable (McClanahan) has a wrongful discharge claim. (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), citing Montgomery v. Bd. of Trustees of Purdue Univ., 849 N.E.2d 1120, 1128 (Ind. 2006))
“The public policy exception to the at-will doctrine can be “generalized to the proposition that an employee who has been fired for exercising a statutory right or refusing to violate the law has a claim for wrongful discharge.””
““On rare occasions,” Indiana Courts have recognized “narrow exceptions” to the at-will doctrine.”
Implied contract exception: recognized?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: govinfo.gov.
Good faith and fair dealing exception: recognized?Not recognizedVerified Sep 24, 2026 · 2 official pages from the same agency
Indiana does not recognize a duty of good faith and fair dealing owed by an employer to an at-will employee. (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), quoting Hamblen v. Danners, Inc., 478 N.E.2d 926, 929 (Ind. Ct. App. 1985))
“(“Indiana does not recognize that a duty of good faith and fair dealing is owed by an employer to an employee at will.”)”
“In addition, Farr’s state law claims were properly dismissed. He claims the employee handbook gave him the right to be treated fairly, but that he wasn’t—in breach of the covenant of fair dealing. Indiana, however, adheres to the employment-at-will doctrine, and Farr was an at-will employee.”
Used in: How to write up an employee (the right way, in your state) · How to put an employee on a performance improvement plan · Employee no call, no show: what to do · Insubordination: what counts, and how to handle it
Service letter (reason for termination)
Do you have to give a written reason for the termination on request?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: iga.in.gov.
Used in: How to write up an employee (the right way, in your state) · How to fire an employee in your state
Separation notice
Do you have to give a separation notice when someone leaves?Not verified yetCheck the official source
We have not verified this rule for Indiana yet. Check the official source: in.gov.
Used in: How to fire an employee in your state
Final pay after firing, neighbors
| State | Final pay after firing |
|---|---|
| Indiana | Not verified |
| Illinois | Next regular payday |
| Michigan | Next regular payday |
| Ohio | Not verified |
| Kentucky | Next payday or 14 days, whichever is later |
Only verified rules are shown. "Not verified" means we have not checked that state's rule yet; open its rulebook for the official source.
What an employee costs in Indiana
Beyond the salary, an employer pays these payroll taxes on each employee. Rates for 2026, from official sources:
- Social Security: 6.2% of wages, up to $184,500 per employee in 2026 (Publication 15).
- Medicare: 1.45% of all wages, with no wage base limit (Topic 751).
- Federal unemployment (FUTA): 6.0% of the first $7,000 of each employee's wages, with a credit of up to 5.4% for state unemployment taxes paid, so usually 0.6% (Topic 759).
- FUTA credit reduction: Indiana is not on the DOL list for 2025 (final) or 2026 (potential), so the full 5.4% credit is available if state unemployment taxes are paid in full and on time (U.S. DOL, FUTA credit reductions; Topic 759).
- Indiana unemployment insurance: taxes apply to the first $9,500 of each employee's wages. Rates for experience-rated employers run from 0.50% to 7.40%; the new-employer base rate is 2.50%. Source: U.S. DOL, Significant Provisions of State UI Laws, effective July 2026, page 2. The DOL notes that higher rates may apply by industry and that the table "is not an official interpretation of state UI laws". Find the Indiana unemployment agency.
A worked example: $40,000 salary
Estimate, before benefits and workers' comp; check with your payroll provider. It assumes a new employer, a full year of wages and the full FUTA credit.
| Tax on a $40,000 salary | Per year |
|---|---|
| Social Security, 6.2% (Topic 751) | $2,480 |
| Medicare, 1.45% (Topic 751) | $580 |
| Federal unemployment (FUTA), 0.6% of the first $7,000 (Topic 759) | $42 |
| Indiana unemployment insurance, new-employer rate 2.50% of the first $9,500 (DOL, July 2026) | $238 |
| Estimated total employer taxes | $3,340 |
Estimate: $3,340 is about 8.3% on top of the salary. It leaves out health insurance, retirement contributions, workers' compensation, state disability or paid leave programs and any local taxes.
Federal wage enforcement in Indiana
In FY2021 to FY2025, the U.S. Department of Labor's Wage and Hour Division concluded 821 cases in Indiana (n = 821), finding $12,278,801 in back wages owed to 11,035 employees (DOL enforcement data). Enforcement data is not a violation rate: it shows where federal investigators looked, and many states handle wage claims through their own agencies. Wage violations by industry.
Changes coming in 2027
We have not found an announced 2027 change for Indiana employers in official sources yet. All 2027 changes by state.
Changelog
- Sep 24, 2026: first verified, 5 rules.
Questions about Indiana employer rules
What is the minimum wage in Indiana?
Indiana's minimum wage is $7.25 per hour for employers of 2 or more employees. (State Minimum Wage Laws (U.S. DOL Wage and Hour Division table, updated July 1, 2026))
Is Indiana an at-will state?
Yes. Indiana follows at-will employment, with exceptions. Of the 3 common exceptions, we have verified 2, and 1 is recognized in Indiana (Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), quoting Hamblen v. Danners, Inc., 478 N.E.2d 926, 929 (Ind. Ct. App. 1985)).
Sources (14)
- State Minimum Wage Laws (U.S. DOL Wage and Hour Division table, updated July 1, 2026)
- Indiana Department of Labor, Indiana Minimum Wage Law poster (PDF)
- Minimum Length of Meal Period Required under State Law for Adult Employees in Private Sector (U.S. DOL WHD table, January 1, 2023)
- Indiana state FAQ: Is there any information regarding Indiana lunch or breaks laws?
- Minimum Paid Rest Period Requirements Under State Law for Adult Employees in Private Sector (U.S. DOL WHD table, January 1, 2023)
- Farr v. St. Francis Hospital & Health Centers, No. 1:06-cv-00779-SEB-JMS (S.D. Ind. Sept. 26, 2007), quoting Hamblen v. Danners, Inc., 478 N.E.2d 926, 929 (Ind. Ct. App. 1985)
- Farr v. St. Francis Hospital & Health Centers, No. 08-3203 (7th Cir. June 29, 2009) (affirming dismissal of the covenant claim)
- Slinger v. Federal Express Corp., No. 1:11-cv-01482-JMS-MJD (S.D. Ind. Mar. 11, 2013), citing Meyers v. Meyers, 861 N.E.2d 704, 706 (Ind. 2007), and McClanahan v. Remington Freight Lines, 517 N.E.2d 390 (Ind. 1988)
- IRS Publication 15 (2026), Circular E, Employer's Tax Guide
- IRS Topic no. 751, Social Security and Medicare withholding rates
- IRS Topic no. 759, Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return
- U.S. DOL, Employment and Training Administration: FUTA credit reductions
- U.S. DOL, Office of Unemployment Insurance: Significant Provisions of State Unemployment Insurance Laws, effective July 2026
- U.S. Department of Labor: State labor offices
Checked Sep 24, 2026 · How we verify every rule · Report an error