Wage & Hour FAQ’s

January 8th, 2010

Wage & Hour FAQs

 1. Wages

a. Minimum Wage

Is my employer required to pay minimum wage or overtime?
Most Indiana employers and employees are covered by the minimum wage and overtime provisions of the federal Fair Labor Standards Act (FLSA); however those not covered under federal law may still be covered by the Indiana Minimum Wage Law.

If I am a waiter or waitress and earn tips, is my employer still required to pay me minimum wage?
Tipped employees must be paid at least the minimum wage. The employer is required to pay a base hourly wage of $2.13 an hour. If the employee is not compensated at a rate equal to the minimum wage after adding any tips he/she received to the base hourly wage of $2.13 an hour, the employer must pay the employee the difference. If the employee earns more than the minimum wage after adding the tips he/she received to the hourly wage of $2.13 an hour, the employer has fulfilled his/her obligation. A tipped employee means any employee engaged in an occupation in which he/she customarily and regularly receives more than $30 a month in tips.

b. Overtime
Is my employer required to pay minimum wage or overtime?
Most Indiana employers and employees are covered by the minimum wage and overtime provisions of the federal Fair Labor Standards Act (FLSA); however those not covered under federal law may still be covered by the Indiana Minimum Wage Law.

What is the overtime law?
Both the federal Fair Labor Standards Act (FLSA) and the Indiana Minimum Wage Law generally require employers to pay employees 1½ times their regular rate of pay (“overtime compensation”) when employees work more that forty (40) hours during a work week. However, there are many exceptions to the overtime pay requirements of both federal and state law. Most of the exceptions to Indiana state law can be found at Indiana Code § 22-2-2-3 (a) – (p). Overtime claims should be made directly to the federal U.S. Department of Labor, Wage and Hour Division at the nearest regional office, or at the Indianapolis District Office.

c. Underpayment/Non-payment of Wages

I didn’t get paid. What can I do?
First, ask your employer why you haven’t received your paycheck and document any reason the employer gives for not paying you. If the employer refuses to give you your paycheck, you can file an Application for Wage Claim with the Indiana Department of Labor or consult a private attorney about your rights and how you should proceed. Employees who have been involuntarily separated from employment (laid off or fired) must file a wage claim with the Indiana Department of Labor before proceeding to file a civil lawsuit to recover wages. An employee who is still employed or separates from employment voluntarily (quits) may either file a wage claim or file a private lawsuit to seek recovery of wages.

Is there a limit to the amount of a wage claim the Department of Labor will accept?
Yes, the minimum amount is $30 and the maximum amount is $6,000. Indiana law establishes these limits. If you believe you are owed more than $6,000 in wages, you should consult a private attorney about your rights and how you should proceed.

How long does it take to resolve a wage dispute (wage claim)?
Most wage disputes are resolved within 180 days. However the actual time required may vary, depending upon the parties’ cooperation and the volume of claims filed. Filing a wage claim does not guarantee payment.

When is an employee’s final paycheck due?
Final wages must be paid on or before the next regularly scheduled payday on which the employee would have been normally paid had the employee remained employed.

Can an employer change an employee’s rate of pay?
Unless covered by a collective bargaining agreement or other form of pay guarantee, an employer can change an employee’s rate of pay as long as the reduction does not bring an employee’s wage below the applicable federal or state minimum wage. The employer must notify the affected employee prior to his/her working at the reduced rate. The employee has the right to accept the lower wage rate or quit.

If you have already performed work without first being notified of the reduction, you could file a claim for wages for the difference in wages for work performed prior to the notification.

d. Deductions
Can an employer fine an employee and take it out of his or her paycheck?
No. An employer is not permitted under Indiana law to fine an employee and deduct the amount from his/her pay.

If I am overpaid, can my employer deduct the amount of the overpayment from my paycheck?
Indiana law permits employers to deduct the amount of overpayment from an employee’s paycheck. However, the employer must notify you in advance and there is a limit to the amount that can be deducted from each paycheck.

Can my employer make deductions from my paycheck?
Indiana law requires three conditions to be met in order for a wage deduction to be valid:

  1. The agreement for the deduction must be in writing, signed by the employee, by its terms revocable at any time by the employee upon written notice, and agreed to in writing by the employer.
  2. A copy of the deduction agreement must be delivered to the employer within ten days of its execution.
  3. Only certain categories of deductions are allowed, including:
    • premiums on an insurance policy;
    • contributions to a charitable organization;
    • purchase price of bonds, securities or stock of the employing company;
    • labor union dues;
    • purchase price of merchandise sold by the employer to the employee;
    • amount of loan made to the employee by the employer;
    • contributions of the employee to a hospital service or medical expense plan;
    • and payment to an employee’s direct deposit account.
If you believe your employer has made a deduction that does not fall within these criteria please view the Application for Wage Claim. You may then fill out this application and mail it to the address in the upper right hand corner. Please be advised that the Indiana Department of Labor can only pursue claims of more than thirty dollars ($30.00) and less than six thousand dollars ($6,000.00).

Can my employer deduct the cost of uniforms from my paycheck?
Indiana law does not allow employers to deduct the cost of mandatory uniforms from an employee’s paycheck. However, it does allow employers to deduct the purchase price of merchandise sold by the employer to an employee if it is at the request of the employee. With this said, if the uniform is optional and the employee makes a written request for the deduction, the cost may be deducted from the employees wages.

e. Payroll Practices

When is an employee’s final paycheck due?
Final wages must be paid on or before the next regularly scheduled payday on which the employee would have been normally paid had the employee remained employed.

Can an employer change an employee’s rate of pay?
Unless covered by a collective bargaining agreement or other form of pay guarantee, an employer can change an employee’s rate of pay as long as the reduction does not bring an employee’s wage below the applicable federal or state minimum wage. The employer must notify the affected employee prior to his/her working at the reduced rate. The employee has the right to accept the lower wage rate or quit.

If you have already performed work without first being notified of the reduction, you could file a claim for wages for the difference in wages for work performed prior to the notification.

When I leave my employment, is my former employer required to pay me for any accrued vacation time?
Accrued vacation pay is considered a form of compensation. An employee may be entitled to a pro rata share of his/her accrued vacation at the time of termination. If there is a company policy or employment contract stipulating that certain conditions must be met before accrued vacation pay will be paid, these conditions must be met in order to receive accrued vacation pay. Vacation policies are generally left to the discretion of the employer.

Does my employer have to pay me for mandatory meetings?
Generally, yes. An employer must compensate employees for time spent on the job when the employee is subject to the employer’s control and direction.

Is my employer required to pay me for sick days, personal days and holidays?
No. Indiana law only requires that employers must pay employees for actual time worked. As a result, employers are not required to pay for sick days, personal days, or holidays.

How can I determine if I am an employee or an independent contractor?
This is an important distinction. Worker classification effects how you are paid and your rights under wage & hour laws. It also effects your eligibility for benefits and your tax responsibility. If you are unsure whether you are an employee or an independent contractor you may want to consult an attorney for advice. You may also contact the Internal Revenue Service and request Form SS-8. Complete the form and return it to the Internal Revenue Service at the address listed on the form. Based on the information provided, they will make a determination as to your status as an employee or independent contractor.

Can an employer require an electronic direct deposit?
Yes. Indiana Code § 22-2-5-1(a) states, “Every person, firm, corporation, limited liability company, or association, their trustees, lessees, or receivers appointed by any court, doing business in Indiana, shall pay each employee at least semimonthly or biweekly, if requested, the amount due the employee. The payment shall be made in lawful money of the United States, by negotiable check, draft, or money order, or by electronic transfer to the financial institution designated by the employee. Any contract in violation of this subsection is void.”

Do I have to be paid for “on-call” time?
Generally, you are only required to be paid for time while you are under the direction and control of your employer. An employee who is required to remain “on-call” at home, or who is allowed to leave a message where he/she can be reached, is not considered to be working while “on-call.” However, an employee who is required to remain “on-call” on the employer’s premises is considered to be working while “on-call.”

May an employer provide pay statements to its employees electronically?
Yes. Indiana Code § 22-2-2-8 requires employers to provide employees with statements of their hours worked, wages paid, and deductions taken therefrom. However, the method of provision is not specified. Therefore, in and of itself, an electronic method would not violate Indiana’s wage and hour statutes.

2. Hours

a. Hours of work
How can I determine if I am an employee or an independent contractor?
This is an important distinction. Worker classification effects how you are paid and your rights under wage & hour laws. It also effects your eligibility for benefits and your tax responsibility. If you are unsure whether you are an employee or an independent contractor you may want to consult an attorney for advice. You may also contact the Internal Revenue Service and request Form SS-8. Complete the form and return it to the Internal Revenue Service at the address listed on the form. Based on the information provided, they will make a determination as to your status as an employee or independent contractor.

Is my employer required to pay me for sick days, personal days and holidays?
No. Indiana law only requires that employers must pay employees for actual time worked. As a result, employers are not required to pay for sick days, personal days, or holidays.

c. Discipline/Suspension/Termination

Can my employer terminate me for no reason?
Generally, yes. In the absence of a collective bargaining agreement or contract providing otherwise, Indiana employers may hire, fire, promote, demote, layoff, suspend, set their own work hours and policies at their discretion. Employers may not discriminate against their employees because of their age, sex, race, religion, national origin, or disability.

Can I be fired even if I have a doctor’s note?
Generally, yes. Indiana employers may hire, fire, promote, demote, layoff, suspend, set their own work hours and policies at their discretion. The federal Family and Medical Leave Act, however, offers some protection for employees taking time off for illness.

Can I do anything about untrue statements that my former employer has made about me to a potential employer?
Indiana has a Blacklisting law which permits employers to disclose only truthful facts about an employee’s termination. If you believe your former employer has made untrue statements about you, you must request copies of any written correspondence from a former employer to a potential employer within 30 days of applying for a job with the potential employer. You may wish to consult a private attorney about any remedies for violation of the Blacklisting law.

d. Breaks/Lunches

Are employers required to provide breaks to employees?
Indiana state law does not generally require employers to provide rest breaks, meal breaks, or breaks for other purposes to adult employees. Minor employees (under 18 years of age) who work six or more hours in a shift must be given one or two breaks totaling at least 30 minutes. These breaks may be taken at any point during the minor’s shift. Indiana Administrative Code 610 IAC 10-3-1 requires break logs to be maintained by the employer to document all breaks provided to minor employees.

Certain other categories of workers, such as airline pilots, truck drivers, and workers covered by a union collective bargaining agreement may be entitled to mandatory breaks under other applicable regulations or by contract. Check with the appropriate regulatory agency or with your union representative.

e. Vacation

Can my employer mandate when I use my vacation time?
Yes. Vacation time is considered a fringe benefit and is up to the discretion of the employer.

Is my employer required to pay me for sick days, personal days and holidays?
No. Indiana law only requires that employers must pay employees for actual time worked. As a result, employers are not required to pay for sick days, personal days, or holidays.

Comments are closed.
Thank you for visiting the McDermott Law Office website. Please note that this site exists for informational purposes only and none of its contents should be considered legal advice. This firm does not intend to provide information for states other than Indiana. Your receipt or transmission of information via this site does not create an attorney-client relationship and cannot serve as a substitute for obtaining legal counsel from an attorney admitted to practice law in your state. If you choose to contact anyone at McDermott Law Office, do not disclose information you consider to be confidential until this firm has been formally engaged to represent you. All unsolicited inquiries or unsolicited information received by our firm will not be regarded as confidential. An attorney from this office will need to verify that McDermott Law Office does not represent other persons or entities involved in the matter and that the firm is willing to accept representation before confidential information is exchanged.