Indiana FLSA Laws

Ensure Compliance with Indiana-Specific FLSA Auditing

Federal FLSA: $7.25/hour.
Indiana Law: $7.25/hour (non-tipped) as of March 10, 2025, per the Indiana Minimum Wage Law (IC 22-2-2-4). Tipped employees: $2.13/hour, with a tip credit of $5.12/hour—employers must ensure tips plus wage meet or exceed $7.25/hour. Youth under 20: $4.25/hour for the first 90 consecutive calendar days of employment. No state or local increases permitted due to a 2011 law banning local minimum wage ordinances.
What You Need to Know: Federal and state minimums align, but failure to cover tip shortfalls or misapplying youth rates can lead to back wages, double damages, and fines up to $1,000 per violation.

Federal FLSA: 1.5x regular rate for hours over 40/week.
Indiana Specifics: Matches federal 40-hour rule (IC 22-2-2-4(f)). Overtime calculated at 1.5x the employee’s regular rate (e.g., $10.88/hour for $7.25/hour workers). Exemptions align with FLSA: executive, administrative, professional employees earning ≥$1,128/week, and highly compensated employees ≥$151,164/year as of January 1, 2025 (per U.S. DOL updates).
Risk: Misclassification of exempt status or unpaid overtime can trigger Indiana Department of Labor (IDOL) or U.S. DOL audits, with costly back pay and penalties.

Indiana Rules: Minors under 14 generally prohibited except in limited roles (e.g., newspaper delivery); 14–15 capped at 3 hours/school day, 8 hours/non-school day, 18 hours/school week (9 p.m. limit June 1–Labor Day); 16–17 unrestricted on hours as of January 1, 2025, but barred from hazardous jobs (e.g., operating power-driven machinery) (IC 22-2-18.1). Work permits required under 16.
Federal FLSA: Aligns with Indiana, but state’s 2025 rollback of 16–17 hour limits defers to federal hazardous job restrictions—stricter rule applies.
Compliance Note: Violations carry fines up to $400 per instance (hour violations) or $10,000 (hazardous work), with federal penalties up to $15,629 per instance.

Federal FLSA: 3-year retention of payroll, hours, and employment records.
Indiana Addition: Employers with 2+ employees must retain wage/hour records for 3 years and provide pay statements showing hours, wages, and deductions for employees 16+ (IC 22-2-2-9). No state-specific format required—electronic or paper acceptable.
Key Detail: Non-compliance risks fines up to $1,000 per violation and complicates wage dispute defenses.

Federal: U.S. DOL enforces with back wages, liquidated damages (up to double unpaid wages), and fines up to $2,653 per wage violation (2025 rate). Child labor penalties: $15,629 per instance, or $71,031 if injury/death occurs.
Indiana: IDOL enforces with back wages, double damages for willful violations, and fines up to $1,000 per wage violation or $400 per child labor hour violation (IC 22-2-2-4, IC 22-2-18.1-26). Criminal penalties possible for repeat willful offenses.
Overlap: Dual federal-state enforcement amplifies liability—penalties can compound.

CFOs and Managers: Indiana’s reliance on federal FLSA, combined with 2025 child labor rollbacks and static $7.25/hour minimum, simplifies some compliance but heightens misclassification risks. A single overtime or wage error could lead to six-figure liabilities, especially in collective actions.
Avoid Costly Mistakes: Regular FLSA audits tailored to Indiana’s framework can safeguard against penalties and lawsuits.

Stay compliant with Indiana’s labor laws and federal FLSA standards—schedule an expert audit to mitigate risks now.