The Indiana Minimum Wages follows the provisions of the FLSA (Federal Labor Standards Act) for minimum wages. The current minimum wage is $7.25 per hour worked and employees working overtime (more than 40 hours per week) are eligible for 1.5 times the minimum wage for the extra hours.
Tipped employees should receive a minimum of $2.14 per hour. This should be done considering that the employees are making the minimum wage along with tips, if not, the employer must pay the difference. Workers under 20 may receive the minimum wage of $4.25 per hour.
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Indiana State Minimum Wage for 2025
The Indiana Minimum Wages follows the provisions of the FLSA (Federal Labor Standards Act) for minimum wages. The current minimum wage is $7.25 per hour worked and employees working overtime (more than 40 hours per week) are eligible for 1.5 times the minimum wage for the extra hours.
Tipped employees should receive a minimum of $2.14 per hour. This should be done considering that the employees are making the minimum wage along with tips, if not, the employer must pay the difference. Workers under 20 may receive the minimum wage of $4.25 per hour.
Minimum Wages in Indiana Cities
The federal rate applies uniformly across all cities of Indiana. Here is a table summarizing the tipped and non-tipped minimum wage rates for the top 30 cities of Indiana:
Cities
Non-Tipped Minimum Wages
Tipped Minimum Wages
Indianapolis
$7.25/hour
$2.13/hour
Fort Wayne
$7.25/hour
$2.13/hour
Evansville
$7.25/hour
$2.13/hour
Fishers
$7.25/hour
$2.13/hour
South Bend
$7.25/hour
$2.13/hour
Carmel
$7.25/hour
$2.13/hour
Bloomington
$7.25/hour
$2.13/hour
Hammond
$7.25/hour
$2.13/hour
Noblesville
$7.25/hour
$2.13/hour
Lafayette
$7.25/hour
$2.13/hour
Gary
$7.25/hour
$2.13/hour
Greenwood
$7.25/hour
$2.13/hour
Muncie
$7.25/hour
$2.13/hour
Kokomo
$7.25/hour
$2.13/hour
Terre Haute
$7.25/hour
$2.13/hour
Anderson
$7.25/hour
$2.13/hour
Elkhart
$7.25/hour
$2.13/hour
Columbus
$7.25/hour
$2.13/hour
Jeffersonville
$7.25/hour
$2.13/hour
Mishawaka
$7.25/hour
$2.13/hour
Lawrence
$7.25/hour
$2.13/hour
West Lafayette
$7.25/hour
$2.13/hour
Portage
$7.25/hour
$2.13/hour
Plainfield
$7.25/hour
$2.13/hour
New Albany
$7.25/hour
$2.13/hour
Merrillville
$7.25/hour
$2.13/hour
Richmond
$7.25/hour
$2.13/hour
Crown Point
$7.25/hour
$2.13/hour
Valparaiso
$7.25/hour
$2.13/hour
Goshen
$7.25/hour
$2.13/hour
Threshold For Employees Exempt
The Fair Labor Standards Act (FLSA) establishes two primary employee categories that determine compensation requirements:
1. Exempt employees
Must earn at least $43,888 annually ($844 weekly)
Not eligible for overtime compensation
Typically includes roles like:
Administrative staff
Executives
Professional positions
Note: Starting January 1, 2025, minimum salary increases to $1,128 weekly and for Highly Compensated Employee (HCE) the threshold is set at $151,164 annually.
2. Non-exempt employees
Guaranteed at least minimum wage
Earn 1.5× regular pay rate for hours worked beyond 40 per week
Often includes hourly workers and lower-salaried positions
When these salary thresholds increase, employers face two choices:
Raise salaries to maintain exempt status
Reclassify employees as non-exempt and pay overtime
Such a system ensures appropriate compensation based on job responsibilities and salary levels. The thresholds are adjusted over time to maintain clear distinctions between classifications.
Historical Data of Indiana Minimum Wages
The current minimum wage in Indiana has remained intact since 2009. In real terms, the purchasing power equivalent of the minimum wage has not bounced back to its historical peaks after an inflation adjustment.
The nominal wage has increased by $5.65 since 1968, but the real purchasing power has decreased nearly by 45% in value over the years.
Since Indiana’s minimum wage is tied to the federal rate, workers’ purchasing power has fallen over time, as inflation has eroded the value of the last increase to $7.25.
Here is a table summarizing all the changes witnessed since 1968:
Time Period
Year
Minimum Wage (in $)
1968 to 1981
1968*
1.15
1970*
1.25
1972
1.25
1976*
1.25
1979
2.00
1980
2.00
1981
2.00
1988 to 1998
1988
2.00
1991
3.35
1992
3.35
1994
3.35
1996
3.35**
1997
3.35**
1998
3.35**
2000 to 2006
2000
5.15**
2001
5.15**
2002
5.15**
2003
5.15**
2004
5.15**
2005
5.15**
2006
5.15**
2007 to 2013
2007
5.15**
2008
5.85**
2009
6.55**
2010
7.25**
2011
7.25**
2012
7.25**
2013
7.25**
2014 to 2019
2014
7.25**
2015
7.25**
2016
7.25**
2017
7.25**
2018
7.25**
2019
7.25**
2020 to 2023
2020
7.25**
2021
7.25**
2022
7.25**
2023
7.25**
* – Under the FLSA, the two rates shown in 1968, 1970, and 1976 reflect the former multiple-track minimum wage system in effect from 1961 to 1978.
** – Rates applicable to employers of four or more.
Indiana follows federal guidelines for minimum wage exemptions, meaning certain workers and employment types are not required to be paid the minimum wage. Here are the main exemptions:
Tipped Employees: Employers can pay tipped workers a lower base rate of $2.13 per hour as long as tips make up the difference to $7.25.
Small Businesses: Businesses with annual revenue under $500,000 and no interstate commerce involvement may be exempt.
Student Workers: High school and college students in certain roles, such as work-study programs or internships, can be paid 85% of the minimum wage for up to 20 hours per week.
Youth Minimum Wage: Workers under 20 can be paid a training wage of $4.25 per hour for their first 90 days of employment.
Furthermore, Section 13(a)(1) of the FLSA offers an exemption to employees who are termed as those being bona fide executive, administrative, professional, and outside sales employees.
Under Section 13(a)(1) and Section 13(a)(17), particular types of computer employees are also exempt from specified criteria in duties and minimum salary levels.
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The MIT Living Wage Calculator estimates that in Indiana in 2024, the living wage for a single adult with no children is approximately $20.44 per hour. This rate rises with household size and the number of dependents.
Indiana follows federal overtime rules under the FLSA. Employees who work more than 40 hours in a workweek are entitled to 1.5 times their regular pay rate for overtime hours unless they qualify for an exemption.
Indiana does not have an established state-specific minimum wage policy and thus defaults to the federal rate. This rate applies to most workers, with specific exemptions outlined by the Fair Labor Standards Act (FLSA)
Indiana has maintained a minimum wage of $7.25 per hour since 2009, following the last federal increase. This rate has remained unchanged for over 15 years, despite inflation eroding purchasing power over time.
Most employers in Indiana are required to pay minimum wage, except those who meet specific FLSA exemptions, such as: Small businesses with revenue under $500,000 are not involved in interstate commerce. Certain tipped employees, youth workers, student workers, seasonal or agricultural employees, and family employees in family-owned businesses.
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