The purpose of wage and hour laws is to provide employers with regulations as to how workers must be paid, the hours that they can be required to work and other issues such as breaks, tips and overtime. The Fair Labor Standards Act outlines the federal minimum wage and hour provisions, and many of these are similar to Indiana’s wage and hour laws. Understanding when to apply these guidelines and their exemptions is part of creating a compliant workplace.
Minimum Wage in Indiana
The Indiana Minimum Wage Law mandates an hourly rate of $7.25 for most employees. While this is the same as the federal rate, it may cover some employees who are exempted by the federal law. State law allows employers to pay workers who are 19 or younger an hourly training wage of $4.25 for the first 90 consecutive days on the job.
Minimum Wage of Tipped Workers: Tipped workers are not exempt from the minimum wage. An employer must pay a base rate of $2.13 per hour, and if this amount combined with the amount earned in tips does not equal $7.25 per hour, the employer must make up the difference.
Does Minimum Wage Apply to Me: There are many very specific exemptions to the minimum wage laws. Executive, administrative and professional employees are exempt from the minimum wage law because they are paid a salary, but only if they make at least $455 per week. Some other examples include student nurses and hospital interns, minors ages 15 or younger and some agricultural laborers.
When Are Raises Required: Employers do not have to raise employees’ hourly rate unless the state or federal minimum wage laws change, or unless they are bound by contract to do so.
Work Hours in Indiana
Indiana laws provide employers with considerable discretion when it comes to creating work schedules for adults. For example, shifts do not have to be set a certain number of hours apart, and employees may be required to work holidays and may have mandatory overtime. Work hour restrictions for minors are much more stringent and vary based on the type of work, the age of the child and the school schedule.
Paying Overtime: The Indiana and FLSA laws for overtime are the same. They state that when an employee works more than 40 hours per workweek, employers must pay a rate of 1.5 times the minimum hourly wage, which is $10.875. Overtime is not figured on a daily schedule, so employees could be expected to work more than eight hours in a day without receiving overtime. Exemptions to overtime laws include many commercial drivers, live-in employees and salespeople.
Guaranteed Breaks and Meals: Only minors are entitled to breaks, and only when a shift is at least six hours. The 30 minutes required can be taken as one break or two and must be documented. Employers in Indiana do not have to provide adult workers with breaks under most circumstances.
Paid Time Off and Sick Pay: Workers are only entitled to pay for the time they are on the clock. Fringe benefits such as vacation pay, holiday pay and sick leave are not required by federal or state laws. Employers may not deny benefits to employees if the company policy offers them.
Notice Period for Employee Termination: An employer is not required to provide a reason or advanced notice before firing employees because Indiana is an employment-at-will state. However, if there is a contract or agreement specifying otherwise, the employer must honor it.
Plant Closings & Layoffs: When a company with more than 100 full-time workers closes a plant or lays off 50 or more workers, it can have devastating effects on the former employees and on the community. The federal Worker Adjustment and Retraining Notification Act provides some protection in these cases by requiring a 60-day notification so that those affected have time to conduct job searches or begin training for a new type of employment.Legal Disclaimer
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