If your employer has failed to pay you properly or in a timely fashion, you may be entitled to recover not only your unpaid wages, but also penalties intended to punish your employer for wage violations. This article explains wage and hour rules for Indiana, including how to determine and collect the money you are owed.
Employees must be paid at least minimum wage for each hour they work. You are entitled to be paid the highest applicable minimum wage where you work, whether that’s the federal, state, or local rate. Indiana’s minimum wage is the same as the federal minimum wage: $7.25 an hour. If you work in a city or county with a higher minimum wage, you are entitled to that amount.
To calculate your unpaid minimum wage claim, simply take the difference between what you were actually paid per hour and what you should have been paid per hour, and then multiply that amount by the total number of hours you worked. For instance, if your employer paid you only $6 an hour for eight weeks of full-time work, you would be entitled to $1.25 ($7.25−$6) times 320 hours (40 hours × 8 weeks), for a total of $400.
If you receive tips from customers, your employer can pay you as little as $2.13 an hour, as long as you earn enough in tips to bring your total hourly earnings up to the minimum wage. If not, you employer must pay you the difference. To learn more, see Indiana Laws for Tipped Employees.
Failing to pay employees properly for overtime is one of the most common wage violations by employers. In Indiana, employees are entitled to overtime if they work more than 40 hours in a workweek.
Not all employees are entitled to earn overtime for extra hours, though. While hourly, nonexempt employees have a right to overtime, other categories of employees are exempt. The most common exemptions are for outside salespeople and “white-collar” employees who do professional, managerial, and high-level administrative work (see our overtime page for more details and exemption categories). Unless your employer can prove that you fit into one of these narrow exemptions, you are entitled to receive overtime.
If your employer has failed to pay you for overtime hours, your unpaid wages are the difference between what you should have been paid and what you were paid. For overtime hours, employees are entitled to time-and-a-half. This means that you’re owed an extra 50% of your hourly rate, on top of your regular pay. For example, if you are usually paid $10, then you must be paid $15 an hour for overtime work.
Example: Lawrence works 40 hours a week at a clothing store for $12 an hour. During the first week of the year, employees must do inventory. They arrive three hours before the store opens for four days in a row to check stock. During inventory week, he is entitled to $12 an hour for the first 40 hours (for a total of $480) and $18 an hour for 12 overtime hours (for a total of $216).
Neither federal nor Indiana law requires employers to provide employees with meal or rest breaks during the workday. However, if your employer chooses to let you take breaks, you are entitled to be paid for:
To calculate your unpaid break wages, add up how much time you spent on shorter breaks that should have been paid or breaks that you had to work through. Multiply this extra time by your hourly rate. And don’t forget overtime: Breaks for which you should have been paid count as hours worked, which means they may push your total hours for the week above 40 per workweek.
In addition to paying your unpaid wages, your employer may also be required to pay liquidated damages. Liquidated damages are intended to compensate you for financial losses caused by your employer’s actions that are difficult to measure. Under Indiana law, if your employer fails to pay you the minimum wage, you can receive an amount equal to your unpaid wages as liquidated damages.
Under the federal Fair Labor Standards Act, you may also be awarded liquidated damages equal to the amount of your unpaid wages if your employer fails to pay you overtime. For example, if your employer failed to pay you $1,200 in overtime, you would be entitled to an additional $1,200 in liquidated damages, or $2,400 total.
In Indiana, you are entitled to be paid for your work within ten business days after you perform it. In addition, you are entitled to receive your final paycheck on the next regularly scheduled payday after you quit, are laid off, or are fired. If your employer doesn’t pay your wages on time, you can be awarded 10% of your unpaid wages for each day your employer fails to pay, up to double the amount of your unpaid wages.
While these are some of the penalties available for wage violations, other penalties may be available under state or local law. For more information, consult with an employment lawyer in your area.
If you were fired or laid off, you must file a wage claim with the Indiana Department of Labor before you may file a lawsuit. However, the Labor Department will accept wage claims only if the amount in controversy is more than $30 and less than $6,000. If you quit or are still employed, you have the option to either file a wage claim (if your claim is for less than $6,000) or file a lawsuit.
If you aren’t comfortable filing a complaint on your own behalf, or you want to file a lawsuit, talk to an experienced Indiana wage and hour lawyer about representing you. A lawyer can file a wage claim or lawsuit on your behalf, seeking to collect your unpaid wages. If you win your lawsuit, your attorney can ask the judge to make your employer pay your attorneys’ fees.
Whether you plan to file a wage claim or hire an attorney to represent you, you should move quickly. In Indiana, you have two years to file for most claims for unpaid wages arising out of violations of state law. However, different time limits apply to claims based on written contracts. And, you may have additional time to file a minimum wage claim under state law. Under federal law, you generally have two to three years to file a claim for unpaid wages.
To make sure that you file your claims in a timely manner, speak to an experienced employment lawyer right away. You can use Nolo’s lawyer directory to find lawyers in your area.