overtime labor laws

Indiana Overtime Laws for Salaried Employees: Everything You Need to Know

The Indiana Overtime law also referred to as the Indiana Minimum Wage Law, echoes the Federal Fair Labor Standards Act (FLSA) in multiple ways. The two require employees to receive 1½ times their regular hourly pay rate as overtime from their employers, for all hours they work above forty hours during a workweek.

However, there are some significant differences between the two laws. According to the Indiana overtime laws for salaried employees, an individual has a right to get overtime pay if the number of employees under the same employer exceeds 40. On the other hand, the federal law does not specify a threshold on the number of employees but instead points out to employers with a gross income of 500,000 dollars.

The Indiana overtime laws for salaried employees and federal laws also differ in the statute of limitations. Under Indiana law, the employee has a maximum of three years to collect the unpaid overtime money from the date of earning. On the other hand, the Federal law sets the period at two years and a maximum of three years if the employer was deliberately infringing the overtime legislation.  


Careers differ in their working hours and the nature of the work environment. Therefore, you find that the eligibility to overtime in Indiana has a wide variety of exemptions. Depending on the employee, they could be exempt or non-exempt. Exempt employees are ineligible for overtime pay.

The major exemptions cited in the Federal overtime law are similar to those in the Indiana overtime laws for salaried employees.  Exempt employees are in four main categories. A job that fits into one of them means that the Indiana and Federal overtime laws do not protect the specific employee working in that position.

• Executive

If the full-time responsibility of a job is to manage at least two employees, it lies in the category of executive position.

• Administrative

If the job’s primary responsibility is non-manual activities such as management policies, administrative training, or business operations, it falls in the administrative position.

• Professional

A job in this category involves one where the main responsibilities require advanced knowledge and extensive education. It includes positions such as skilled computer experts, certified teachers, and artists.

• Outside Sales

Suppose an employee’s main responsibilities are to make sales or deliver orders to places outside the employer’s workplace. In that case, their job is in the category of an outside sales position.

As an employer, you should note that employees whose positions fall under the above categories are not eligible for an overtime premium according to the Federal and Indiana labor law. These laws majorly protect the hourly wage earners, especially those in blue-collar industries, due to high vulnerability to exploitation. The objective is to cushion workers from exploitation by employers.


Although overtime may be appropriate during the peak periods, employers must monitor and control overtime levels to slash excessive use. Besides, failure to adhere to the overtime legislation may lead to penalties and accrued overtime payments.

Employers who intentionally fail to pay overtime are subject to liquidated damages. That provision is the same in both the Indiana overtime laws for salaried employees and federal overtime law. Liquidated damages involve a requirement to pay an extra amount of money equal to the owed amount to punish the employer.

Final Thoughts

Regardless of the size of a business, overtime costs can have a lot of financial impacts. Dependence on manual tracking of employees is inefficient, and you might find yourself out of compliance. That is why companies are keen to avoid overtime by integrating payroll and timekeeping services. It is a cost-effective system that reduces overheads and increases data accuracy, allowing real-time tracking of employees.

Contact ASAP Payroll today at (317) 887-2727 or visit our site for more information.

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