Indiana Minimum Wage: Rate, Tipped Wage, and Local Rules

As of 2026, Indiana's minimum wage is $7.25 per hour, the same as the federal minimum wage under the Fair Labor Standards Act (FLSA). Indiana's state minimum-wage law (Indiana Code 22-2-2, the Minimum Wage Law of Indiana) sets the rate at $7.25 and ties it to the federal floor; the state has not enacted a higher figure and has no automatic inflation indexing, so the rate has remained unchanged since the federal increase took effect in 2009. Because Indiana matches the federal baseline, most Indiana workers are entitled to at least $7.25 for every hour worked, whichever standard applies to their employer. Always confirm the current figure with the Indiana Department of Labor before relying on it, because legislatures can change the law.

The Basic Rate: $7.25, Matching the Federal Floor

Unlike states such as California, Washington, or neighboring Illinois that have raised their minimums well above the federal level, Indiana keeps its wage floor locked to the FLSA's $7.25 per hour. Two separate laws can cover an Indiana worker: the federal FLSA and Indiana's own Minimum Wage Law. The FLSA generally applies to employees of businesses with at least $500,000 in annual gross sales, and to workers individually engaged in interstate commerce. Indiana's state law fills gaps by covering many smaller employers that have two or more employees and are not already subject to the FLSA. When both laws apply, the employer must follow whichever gives the worker the greater protection, but because both set the same $7.25 rate, the practical floor in Indiana is $7.25.

Indiana does not have a separate, higher "large employer" rate, a youth subminimum unique to the state beyond what federal law allows, or any built-in cost-of-living adjustment. If the federal minimum wage were to rise, Indiana's statute is written to track it, but there is no state mechanism that raises the wage on its own.

Tipped Employees and the Tip Credit

Indiana follows the federal tip-credit model. An employer may pay a tipped employee a cash wage of as little as $2.13 per hour and claim a tip credit of up to $5.12 per hour against the $7.25 minimum, so long as the worker's tips make up the difference. A "tipped employee" is someone who customarily and regularly receives more than $30 a month in tips, such as servers, bartenders, and some hotel staff.

The key protection is the guarantee: if an employee's cash wage of $2.13 plus actual tips does not reach $7.25 for every hour in the workweek, the employer must make up the shortfall. In other words, $7.25 is the real floor, and the $2.13 figure is only the minimum direct cash an employer can pay before tips. Employers must also notify tipped workers that they are taking a tip credit, and tips remain the property of the employee. Tip pooling is allowed among employees who customarily receive tips, but supervisors, managers, and the employer generally cannot keep employees' tips.

Overtime in Indiana

Indiana's overtime rules also mirror federal law. Non-exempt employees must be paid one and one-half times their regular rate for hours worked over 40 in a workweek. Indiana does not require daily overtime (no extra pay simply for working more than eight hours in a day), unlike a handful of states. The same exemptions that apply under the FLSA, such as bona fide executive, administrative, and professional employees, also generally apply in Indiana.

Exceptions and Carve-Outs

Several categories of workers may be paid differently or fall outside the standard minimum:

• Training/youth wage: Federal law allows employers to pay workers under 20 a training wage of $4.25 per hour for their first 90 consecutive calendar days of employment. Indiana permits this consistent with federal rules.
• Tipped workers: As described above, a $2.13 cash wage is allowed when tips bring total pay to at least $7.25.
• Exempt employees: Salaried executive, administrative, professional, outside sales, and certain computer employees who meet the federal salary and duties tests are exempt from minimum-wage and overtime requirements.
• Other exclusions: Certain agricultural workers, some seasonal employees, and independent contractors (who are not "employees" at all) may be treated differently. Misclassifying an employee as an independent contractor to avoid the minimum wage is unlawful.

Are There Any City or County Minimum Wages in Indiana?

No. Indiana law preempts local minimum-wage ordinances. Indiana Code prohibits cities, towns, and counties from setting their own minimum wage above the state rate or regulating the wages, hours, or benefits employers must provide. This means there is no separate Indianapolis, Fort Wayne, Evansville, or Marion County minimum wage. The $7.25 statewide rate applies uniformly across all 92 counties. Workers should not expect a higher local floor anywhere in Indiana, which is different from states like Illinois or Ohio where some localities set higher rates.

Scheduled Increases and Inflation Indexing

Indiana has no scheduled future increases and no inflation indexing. The rate will stay at $7.25 unless the Indiana General Assembly passes a new law or Congress raises the federal minimum wage (which Indiana's statute would then follow). Several bills to raise Indiana's minimum have been introduced in past legislative sessions but have not become law. Because nothing automatically adjusts the wage, the figure can remain static for years, so the most important step is to verify the current rate rather than assume it has changed.

How to Enforce Your Right to the Minimum Wage

If you are paid less than $7.25 per hour, or a tipped employee whose cash wage plus tips falls short, you have options:

• File a wage claim with the Indiana Department of Labor (IDOL). IDOL administers the state Wage Claim and Wage Payment processes for many unpaid-wage disputes. Claims are generally filed online or by mail, and there is no charge to file.
• File with the U.S. Department of Labor, Wage and Hour Division (WHD). Because Indiana matches the federal rate, federal enforcement is often the strongest path. WHD can investigate and recover back wages.
• Sue in court. Indiana's wage statutes allow recovery of unpaid wages and, in some cases, liquidated (double) damages plus attorney's fees. The FLSA also allows recovery of back wages plus an equal amount as liquidated damages.

Keep records of your hours, pay stubs, and tips. Retaliation against a worker for asserting wage rights is prohibited under both Indiana and federal law. Strict time limits apply, so act promptly; the FLSA generally allows claims going back two years, or three years for willful violations.

Where to Confirm the Current Rate

Because rates and rules can change, verify the current figure with the official source before relying on it. The authoritative state agency is the Indiana Department of Labor (IDOL), which publishes the state minimum-wage rate, tipped-wage rules, and the required workplace poster. For federal questions, the U.S. Department of Labor Wage and Hour Division is the official source. When in doubt, contact IDOL directly or consult an Indiana employment attorney, especially for tip-credit and exemption questions where the details matter.

Official Indiana Sources

This page is based on Indiana employment law. Rules and figures change — verify the current details directly with the official Indiana sources below. This is general legal information, not legal advice.

• Indiana Department of Labor (IDOL) — official Indiana agency.
• Indiana DOL Wage & Hour Online Wage Claim Form
• Indiana Code Title 22 (Labor and Safety), Article 2 — Wages, Hours, and Benefits

Federal law and local ordinances may also apply. Federal laws like the Fair Labor Standards Act set a national floor, and your city or county may add protections (such as a higher local minimum wage or paid sick leave). Check both alongside Indiana state law.