Indiana Minimum Wage 2026
The minimum wage in Indiana is $7.25 per hour in 2026, effective July 24, 2009. Tipped employees can be paid a cash wage of $2.13 per hour, as long as tips bring them to the full minimum.
What is the minimum wage in Indiana in 2026?
The Indiana minimum wage is $7.25 per hour in 2026, identical to the federal rate and unchanged since July 24, 2009. Indiana's state statute applies to employers with two or more employees, and it mirrors the federal number, so there is effectively one floor across the state.
The defining contrast for Indiana employers sits at the state line. Illinois pays $15.00 per hour, more than double Indiana's floor, and in the Chicago metro that difference plays out block by block: a warehouse in Hammond and one in Calumet City can face legally required pay gaps of nearly $8.00 an hour for the same job.
Tipped minimum wage in Indiana
Indiana adopts the federal tipped wage structure. Tipped employees may be paid $2.13 per hour in cash wages, with a tip credit of up to $5.12, provided tips lift total hourly earnings to at least $7.25 across each workweek.
Employers remain on the hook whenever the math fails. A slow week that leaves a tipped employee under $7.25 per hour means the employer must top up wages for that period. Build a tip reconciliation step into every payroll run for restaurant and service staff.
Indiana minimum wage history: 2020 to 2026
| Year | Minimum wage | Tipped wage |
|---|---|---|
| 2020 | $7.25 | $2.13 |
| 2021 | $7.25 | $2.13 |
| 2022 | $7.25 | $2.13 |
| 2023 | $7.25 | $2.13 |
| 2024 | $7.25 | $2.13 |
| 2025 | $7.25 | $2.13 |
| 2026 | $7.25 | $2.13 |
Upcoming minimum wage increases in Indiana
There are no scheduled increases. Indiana's minimum can only rise if the General Assembly amends the state statute or Congress lifts the federal rate, and neither body has passed anything.
Democratic legislators in Indianapolis file minimum wage bills nearly every session, with targets ranging from $10.00 to $15.00, but they have not received committee votes in the Republican-controlled General Assembly. For planning purposes, assume $7.25 through 2027 while watching the Illinois border effect on your actual offer rates.
Minimum wage by city in Indiana
Indiana has preempted local minimum wages since 2011, so neither Indianapolis nor any other city or county can set a higher floor. The $7.25 rate is the law everywhere in the state.
Real wages tell a different story by region. Northwest Indiana employers compete directly with $15.00 Illinois paychecks across the Chicago metro line, and the Indianapolis logistics corridor has pushed typical warehouse starting pay to double the minimum or more.
State rate; the 2011 preemption law prevents any city ordinance
State rate applies; manufacturing wages locally start far above it
State rate; tri-state labor pool with Kentucky and Illinois shapes pay
State rate, though proximity to $15.00 Illinois wages pressures employers
What Indiana employers need to know
Two-employee threshold
Indiana's minimum wage law covers employers with two or more employees. Single-employee businesses outside FLSA coverage are exempt from the state law, though nearly all businesses of any size fall under the federal $7.25 anyway.
Overtime
Pay 1.5x the regular rate for hours over 40 per workweek, following the FLSA. Indiana imposes no daily overtime and no premium pay for weekends or holidays.
Tipped employees
The $2.13 cash wage is lawful only when tips reliably close the gap to $7.25 each workweek. Provide tip credit notice up front and correct shortfalls in the same pay period they occur.
Posting and records
Display both the federal FLSA poster and the Indiana minimum wage poster from the Indiana Department of Labor, and retain time and pay records for at least three years.
How other states compare
See how Indiana's $7.25 rate stacks up against other state minimum wages in 2026, or browse the full minimum wage index for all 50 states.
Last verified:
Sources: the US Department of Labor's state minimum wage table and official announcements from the Indiana labor department. Minimum wage laws change frequently; confirm current rates with those sources or legal counsel before setting pay.
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