Indiana’s minimum wage in 2026 is $7.25 per hour. The tipped minimum wage is $2.13 per hour, provided total compensation (wages plus tips) reaches $7.25/hr. Indiana’s minimum wage is $7.25/hr, matching the federal minimum. Tipped employees may be paid $2.13/hr.
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Indiana's minimum wage matches the federal minimum of $7.25/hr. As an employer, you must pay at least the applicable minimum wage to all non-exempt employees. Getting this wrong can result in back pay claims, penalties, and lawsuits.
Current Indiana Minimum Wage: $7.25/hr
| Standard Minimum Wage | $7.25/hr |
| Tipped Minimum Wage | $2.13/hr |
| Federal Minimum Wage | $7.25/hr |
When both federal and state minimum wages apply, employers must pay the higher of the two. In Indiana, both rates are $7.25/hr.
Tipped Employee Minimum Wage: $2.13/hr
Employers may pay tipped employees a lower base wage of $2.13/hr, provided that the employee’s total compensation (base wage plus tips) meets or exceeds the full minimum wage of $7.25/hr for every hour worked. If tips don’t make up the difference, the employer must pay the shortfall.
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Federal vs. State Minimum Wage
The federal minimum wage has been $7.25/hr since 2009. Indiana follows the federal rate. If the federal minimum wage increases, Indiana employers would need to comply with the new federal rate.
Local Minimum Wage Exceptions
Indiana’s minimum wage is $7.25/hr, matching the federal minimum. Tipped employees may be paid $2.13/hr.
Overtime and Minimum Wage
Under the FLSA, non-exempt employees who work more than 40 hours in a workweek must be paid at least 1.5x their regular rate. The overtime rate is based on the actual rate paid (which must be at least the minimum wage), not a fixed multiplier of the minimum.
For more on overtime rules, see our Overtime Pay Rules guide.
Employer Compliance
- Pay at least $7.25/hr to all non-exempt employees
- Track tipped employee earnings and make up tip credit shortfalls
- Display the required minimum wage poster in a visible workplace location
- Keep accurate payroll records for at least 3 years (federal requirement)
- Monitor for local minimum wage ordinances in your municipality
Frequently Asked Questions
What is the Indiana minimum wage in 2026?
The Indiana minimum wage in 2026 is $7.25 per hour. Indiana’s minimum wage is $7.25/hr, matching the federal minimum. Tipped employees may be paid $2.13/hr.
What is the tipped minimum wage in Indiana?
The tipped minimum wage in Indiana is $2.13 per hour, provided that total compensation (base wage plus tips) meets or exceeds the full minimum wage of $7.25/hr.
Does Indiana follow the federal minimum wage?
Yes, Indiana follows the federal minimum wage of $7.25/hr. The state minimum wage matches the federal floor.
What are the penalties for violating Indiana minimum wage laws?
Employers who fail to pay the minimum wage in Indiana may face back pay obligations, penalties, fines, and potential lawsuits from affected employees. The Indiana Department of Workforce Development enforces minimum wage compliance.
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Legal & Tax Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or professional advice. Employment laws, tax regulations, and compliance requirements change frequently. The information on this page reflects our understanding as of February 2026 and may not reflect recent changes in federal or Indiana state law.
Do not act or refrain from acting based solely on the information in this article. Always consult a qualified attorney, CPA, or HR professional familiar with Indiana law before making payroll or compliance decisions for your business.