In Indiana, employers are not required to provide employees with vacation benefits, either paid or unpaid. If an employer chooses to provide such benefits, it must comply with the terms of its established policy or employment contract.
An employer may lawfully establish a policy or enter into a contract denying employees payment for accrued vacation leave upon separation from employment. See Indiana Heart Associates, P.C. v. Bahamonde, 714 N.E.2d 309 (Ind. App. 1999); Die &Mold, Inc. v. Western, 448 N.E.2d 44 (Ind. App. 1983).
An employer may also lawfully establish a policy or enter into a contract disqualifying employees from payment of accrued vacation upon separation from employment if they fail to comply with specific requirements, such as giving two weeks notice or being employed as of a specific date of the year. See Williams v. Riverside, 846 N.E.2d 738 (Ind. App. 2006); Damon Corp. v. Estes, 750 N.E.2d 891 (Ind. App. 2001); Indiana Heart Associates, P.C. v. Bahamonde, 714 N.E.2d 309 (Ind. App. 1999).
An employer is required to pay accrued vacation to an employee upon separation from employment if its policy or contract requires it. See Indiana Heart Associates, P.C. v. Bahamonde, 714 N.E.2d 309 (Ind. App. 1999); Die &Mold, Inc. v. Western, 448 N.E.2d 44 (Ind. App. 1983).
An employer is required to pay accrued vacation leave upon separation from employment if the employer’s established policy or employment contract is silent on the matter. See Haxton v. McClure Oil Corp., 697 N.E.2d 1277 (Ind. App. 1998).
An employer may cap the amount of vacation leave an employee may accrue over time. See Indiana Heart Associates, P.C. v. Bahamonde, 714 N.E.2d 309 (Ind. App. 1999); Die &Mold, Inc. v. Western, 448 N.E.2d 44 (Ind. App. 1983).
Neither Indiana’s Legislature nor its courts have stated whether an employer can lawfully implement a “use-it-or-lose-it” vacation policy requiring employees to use their vacation leave by a specific date or lose it. However, based on the State’s strong policy favoring freedom of contract, it is likely such a policy would be lawful so long as employees were made aware of the policy prior to it being enforced and so long as employees had reasonable opportunities to use the leave prior to losing it. See Naugle v. Beech Grove City Schools, 864 N.E.2d 1058 (Ind. Sup. Ct. 2007).
Indiana law does not require employers to provide employees with sick leave benefits, either paid or unpaid. If an employer chooses to provide sick leave, it must give employees written notice of the terms of the policy. An employer in Indiana may be required to provide an employee unpaid sick leave in accordance with the Family and Medical Leave Act or other federal laws.
Indiana law does not require private employers to provide employees with either paid or unpaid holiday leave. IN Dept. of Labor FAQs. In Indiana, a private employer can require an employee to work holidays. A private employer does not have to pay an employee premium pay, such as 1½ times the regular rate, for working on holidays, unless such time worked qualifies the employee for overtime under standard overtime laws. If an employer chooses to provide either paid or unpaid holiday leave, it must comply with the terms of its established policy or employment contract.
Visit our Indiana State Holidays page for a list of holidays recognized and observed by the state of Indiana as well as information regarding state laws governing holiday leave for public employers and employees.
Jury Duty Leave
Indiana does not require employers to pay an employee for responding to a jury summons or serving on a jury.
An employer may not subject an employee to an adverse employment action (e.g., termination, demotion, discipline) for responding to a jury summons or serving on a jury.
An employer may not subject an employee to an adverse employment action (e.g., termination, demotion, discipline) for responding to a jury summons or serving on a jury if the employee provides notice to the employer of the jury service within a reasonable period of time after receiving the summons and before the service is to begin.
If an employer with ten (10) or fewer employees has an employee summoned for jury service while another employee is already performing jury service, the employer may request, through either employer, that the summoned employee’s jury service be postponed until the employee currently performing jury service completes his or her service.
Indiana does not have a law which requires an employer to grant its employees leave, either paid or unpaid, to vote.
Indiana law does not require employers to provide employees bereavement leave or leave to attend funerals. Bereavement leave is leave that is taken by an employee due to the death of another individual, usually a close relative. Employers may choose to provide bereavement leave and may be required to comply with any bereavement policy or practice they maintain.
Family and Medical Leave
Employers in Indiana must adhere to the guidelines set out by the Family and Medical Leave Act (FMLA). This act allows employees to take unpaid time off, who may then return to their former position.
If an employer in Indiana has a minimum of 50 employees for 20 weeks in either the previous or the current year, they must adhere to all guidelines as set out by the FMLA.
If an employee has worked for the same company for at least one year, has worked a minimum of 1,250 hours in the past 12 months, and has worked at the same location with 50 or more employees in a 75-mile area, they are eligible to receive FMLA benefits.
This leave may be for:
- Recovering from a severe health issue
- Caring for a member of the family with a severe health condition
- Bonding with or caring for a new child
- Handling qualifying circumstances from a family member’s military service
- Caring for a family member who has incurred a severe injury due to military duty.
If an employee meets the above criteria, they may receive up to three months of leave in one year. As long as an employee meets the conditions set out above, they may take 12 weeks’ leave once a year.
If the leave is due to military caregiving, the employee is allowed up to 26 weeks of leave in 1 year. Military caregiver leave is on a per-service member and per injury entitlement, which means that unless that member of the family is re-injured or a different member of the family incurs another injury during military service, a worker is not entitled to have more leave for this purpose.
While on leave, employees may continue paying into and receiving their healthcare insurance at the same cost paid while on the job. Although FMLA leave is not paid, employees may be required or allowed to use accumulated leave. When the FMLA leave is over, a worker has the right to return to the same position, or if this is not available to an equivalent position.
Indiana Military Leave
Indiana also has its own military leave law that states that any employer with at least 50 employees must allow an eligible employee to take up to 10 days leave for military family reasons.
Employees may take this leave 30 days before active duty, while the person is on leave during active duty, and for the 30 days following active military duty. An employee must have a grandparent, parent, spouse, or sibling on active duty for 90 days or longer to take this leave.