2021 Indiana Tipped Minimum Wage
The 2021 Indiana Tipped Minimum Wage is $2.13.
Effective 2021-01-01Source: Indiana Minimum Wage Law (Indiana Department of Labor)Verified 2026-09-01
Compared with 2020
Every figure on this page is unchanged from 2020.
| Item | 2020 | 2021 | Change |
|---|---|---|---|
| Minimum cash wage | $2.13 | $2.13 | +$0 (+0.0%) |
Who it applies to
Indiana employers who pay tipped employees and claim a tip credit under the Indiana Minimum Wage Law
What changed this year, and why
The tipped minimum wage (minimum cash wage) in Indiana remains at $2.13 per hour for 2021.
Common questions
- What is the tipped minimum cash wage in Indiana for 2021?
- Employers must pay tipped employees at least $2.13 per hour if they claim a tip credit.
- What happens if a tipped employee's tips and cash wage do not add up to the full minimum wage?
- The employer must make up the difference so the employee receives at least the full minimum wage.
What a tip credit is, and the cash wage underneath it
In Indiana, an employer may pay a tipped employee a direct cash wage of $2.13 per hour instead of the full minimum wage, so long as the employer claims a tip credit. The tip credit is the gap between that cash wage and the regular minimum wage. This arrangement is only lawful if the employee actually receives enough tips to cover that gap. Indiana follows the federal rule on what counts as a tip credit: the employer takes a credit equal to the difference between the direct wage it pays and the full minimum wage it would otherwise owe. The cash wage underneath the credit is fixed at $2.13 per hour. If the employee's tips are smaller than the gap, the employer cannot keep the benefit of the credit and must pay enough to reach the minimum wage. The tip credit is therefore conditional on the employee's tips being large enough to make the cash wage plus tips equal at least the minimum wage for every hour worked.
Generally, employers must pay tipped employees at least $2.13 per hour if the employer claims a tip credit.
Indiana Minimum Wage Law (Indiana Department of Labor)
When the tips do not get you to the minimum wage
Indiana law requires that tipped workers receive at least the minimum wage for every hour worked when their cash wages and tips are combined. If the employee's tips combined with the hourly wage do not equal the minimum wage, the employer must make up the difference. This means employers in Indiana who pay the reduced cash wage of $2.13 per hour must monitor each pay period to ensure tipped employees are actually earning the full minimum wage once tips are included. If a worker has a slow week or works in a low-tip environment, the employer cannot simply accept the shortfall—the law requires the employer to add enough to that worker's wages to close the gap. This protection ensures that the tip credit arrangement does not leave tipped employees in Indiana earning less than the minimum wage, regardless of how much they receive in tips during any given pay period.
If the employee’s tips combined with the hourly wage do not equal the minimum wage, the employer must make up the difference.
Indiana Minimum Wage Law (Indiana Department of Labor)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Indiana Minimum Wage Law (Indiana Department of Labor)
- Minimum cash wage
Generally, employers must pay tipped employees at least $2.13 per hour if the employer claims a tip credit.
Other years
Every Indiana Tipped Minimum Wage year · Tipped Minimum Wage in every state