Indiana Employment Screening Overview
Indiana is generally employer-friendly for background screening, with no statewide ban-the-box law for private employers and no salary history ban or broad credit check restrictions beyond federal requirements.
However, employers must follow strict rules protecting expunged records from disclosure and consideration, and state contractors face mandatory E-Verify obligations—federal requirements and local ordinances may still apply.
What's Permitted
- Private employers may ask about criminal history at any hiring stage
- Salary history inquiries permitted throughout the hiring process
- Drug testing allowed pre-employment, random, and post-accident for most employers
- E-Verify required for state contractors and grant recipients over $1,000
What's Prohibited
- Discriminating against applicants based on expunged or sealed criminal records
- Reporting expunged records or criminal history not updated within sixty days (CRAs)
- Failing to enroll in E-Verify for state contracts, public works, or grants over $1,000
- Using credit checks without business necessity (state agency employers)
Ban the Box Laws
Public Employers OnlyStatus Summary
No statewide private-sector Ban the Box. SB 312 preempts local ordinances. Executive-branch jobs follow EO 17-15 (removes application questions; delays inquiries). FCRA still applies. https://iga.in.gov/ic/2017/2017%20Acts.pdf https://www.in.gov/governorhistory/ericjholcomb/fi...
Key Requirements
Senate Bill 312 (Indiana Code §22-2-17)
State preemption of local ban-the-box ordinances: SB 312 / IC §22-2-17
- Preempts local ban-the-box ordinances
- Employers may ask criminal history anytime
- Limited employer immunity in certain suits
- Effective July 1, 2017
Executive Order 17-15 (Fair Chance Hiring)
Fair chance hiring for executive-branch jobs: Executive Order 17-15 (PDF)
- Removes criminal-history questions from applications
- Delays criminal inquiries until later process
- Agencies may consider records after interview
- State Personnel lists individualized assessment factors
Fair Credit Reporting Act (FCRA)
Federal background-check rules applicable to employers: IN State Personnel background-check policy
- Require applicant notice and written consent
- Two-step adverse-action process for denials
- Seven-year restrictions for some records
- Applies to all employers using CRAs
Indiana CRA and reporting rules
State rules on reporting and limited records: ISP Limited Criminal History PLA CBC guidance
- Reports must be updated within sixty days
- Cannot disclose expunged or sealed records
- Limited search shows felonies and A misdemeanors
- ISP search PDF expires after fourteen days
Professional licensing background checks
Licensing timing and fingerprint requirements: PLA criminal-background-checks FAQ
- Background checks after application submission
- Fingerprints submitted on or after receipt
- Prior checks considered invalid
Ban the Box Best Practices for Indiana Employers
- Comply with FCRA notice, consent, and adverse-action procedures
- Use individualized assessments per EEOC guidance before adverse decisions
- Private employers may ask criminal history at any hiring stage
- State executive positions: remove application questions; delay inquiries
- Ensure consumer reports updated within sixty days per Indiana law
Salary History Ban
NoIndiana — No statewide salary-history ban
As of Jan 2026, no state ban (https://iga.in.gov/legislative/2025/bills/house/13...
- Employers may ask prior salary history.
- No state timing restrictions on inquiries.
- No state penalties for asking salary.
- Must avoid discriminatory pay practices.
- Monitor pending bills for changes.
Indiana Civil Rights Act
State anti‑discrimination law governs pay decisions (https://iga.in.gov/laws/2018/ic/titles/22/):
- Prohibits discrimination by protected characteristics.
- Covers employers with six or more employees.
- Complaints fileable within 180 days.
- Civil Rights Commission investigates complaints.
Equal Pay Act (federal)
Federal prohibition on sex‑based wage discrimination (https://www.in.gov/dol/wage-and-hour/wage-and-hour...
- Prohibits wage discrimination based on sex.
- Applies when jobs are substantially equal.
- Relying on prior salary risks liability.
- Remedies include back pay and fees.
Paycheck Fairness Act (proposed federal)
Proposed federal bill limiting salary inquiries (https://www.congress.gov/bill/118th-congress/house...
- Prohibits requesting salary history.
- Requires wage‑range disclosures in postings.
- Imposes civil penalties for violations.
- Not enacted as of Jan 2026.
Salary History Best Practices for Indiana Employers
- Prefer market-based salary bands over applicants' prior pay
- Eliminate salary history questions from applications and interviews
- Document compensation rationale and maintain three-year records
- Train hiring managers on non-discriminatory pay-setting practices
- Use salary expectations, not prior salary, when appropriate
Consumer Credit Checks
NoIndiana: state agencies may run credit checks only for business necessity; must comply with FCRA (separate disclosure/authorization, pre‑adverse notice with report/Summary of Rights and five‑day review, adverse‑action notice); bankruptcy/garnishment cannot be sole basis. Private employers: FCRA only. https://www.in.gov/spd/files/bgcheckpolicy.pdf
Key Requirements
Fair Credit Reporting Act (FCRA)
Federal law governing consumer reports for employment:
- Separate written disclosure and authorization required
- Pre-adverse notice with report and rights
- Adverse action notice with CRA contact
- Allow applicant five days to dispute
- Provide free report within sixty days
Source: https://www.in.gov/spd/files/bgcheckpolicy.pdf; https://www.congress.gov/bill/117th-congress/house...
Indiana State Personnel Department Background Check Policy (June 21, 2019)
State policy applying to civil service agencies:
- Credit checks only for business necessity
- Applies to state civil service agencies
- Recommended for financial responsibility positions
- Cannot discriminate for bankruptcy or garnishment
- Executive head hires include credit checks
Indiana Code — Criminal History Providers (IC 24‑4‑18)
State statute on criminal history reporting (not credit):
- Governs criminal history providers reporting
- Does not regulate credit checks
- Requires accuracy in criminal history reporting
- Enforced under Indiana statutory framework
Source: https://law.justia.com/codes/indiana/title-24/arti...
Credit Check Best Practices for Indiana Employers
- Limit credit checks to positions with documented business necessity
- Obtain separate written disclosure and authorization per FCRA
- Provide pre-adverse action package: report, Summary of Rights, five days
- Issue adverse action notice with CRA contact and dispute rights
- Never base adverse actions solely on bankruptcy or garnishment
Marijuana Protection
Medicinal Marijuana
Indiana provides no employer protection for medical marijuana; employers may discipline for THC. ADA and MRO prescription review protect lawful medications and MOUD; sector-specific statutes may mandate THC testing (see IC 22‑9‑5‑24, IC 16‑27‑2.5).
Recreational Marijuana
Recreational marijuana use has no state employment protections in Indiana; private employers may test and discipline for THC. Federal rules (e.g., DOT) and sector statutes may impose stricter obligations (see IC 22‑9‑5‑24, IC 4‑13‑18‑6).
Drug Testing Regulations
Indiana is neutral on private employer drug testing (IC 22‑9‑5‑24: https://iga.in.gov/laws/2025/ic/titles/22#22-9-5-24); mandatory testing covers public works (IC 4‑13‑18‑6: https://iga.in.gov/laws/2025/ic/titles/4#4-13-18-6), home health (IC 16‑27‑2.5: https://iga.in.gov/laws/2025/ic/titles/16#16-27-2.5), and licensed child care (IC 12‑17.2‑4‑3.5: https://iga.in.gov/laws/2025/ic/titles/12#12-17.2-4-3.5); federal DOT/ADA requirements still apply.
Permitted Testing Types
Pre-Employment
Permitted generally; certain industries have specific statutory rules.
Random Testing
Permitted generally; federal and some state sectors impose rules.
Reasonable Suspicion
Permitted; documentable observations required; ADA/discrimination limits apply.
Post Accident
Permitted; must avoid retaliatory use; OSHA and federal rules constrain.
Workers' Compensation Discount
Employers with documented drug-testing programs may qualify for workers' compensation premium discounts, subject to insurer or program criteria.
Insurers/employers must still prove intoxication caused injury to deny benefits; federal rules and sector mandates may alter requirements.
Best Practices
- Provide written drug-testing policy; notify applicants and employees
- Ensure ADA compliance; avoid discriminatory or disparate-impact testing
- Use Medical Review Officers and chain-of-custody procedures
- Follow federal requirements for DOT and federal contractors
- Limit access; keep drug test results confidential
Clean Slate Laws
NoIndiana has no comprehensive clean‑slate law; expungements are petition‑based under IC 35‑38‑9 with limited automatic sealing for non‑convictions (effective 7/1/2022). CRAs/employers must not report or consider expunged records. https://www.in.gov/ipdc/files/TITLE35_AR38_ch9.pdf https://www.in.gov/dol/
E-Verify Requirements
Mandatory for Public ContractorsWho Must Use E-Verify
Private Employers [Indiana Code Title 22, Article 5, Chapter 1.7]
Private employers generally are not required statewide to use E‑Verify unless they enter Indiana public contracts or receive state grants triggering statutory requirements.
https://www.in.gov/idoa/files/standard_contract_la... https://www.in.gov/spd/files/I-9-verification-poli...
Federal Contractors [Immigration Reform and Control Act of 1986; Federal Acquisition Regulation]
Federal contractors remain subject to applicable federal E‑Verify/IRCA/FAR obligations regardless of Indiana’s state-law framework.
https://www.in.gov/spd/files/I-9-verification-poli... https://www.in.gov/idoa/files/standard_contract_la...
Any other relevant groups [Indiana Code Title 22, Article 5, Chapter 1.7]
State agencies, political subdivisions, public contractors/subcontractors, and grant recipients >$1,000 must enroll in and use E‑Verify; violations carry a 30‑day cure, termination, and damages framework.
https://www.in.gov/spd/files/I-9-verification-poli... https://www.in.gov/idoa/files/standard_contract_la... https://www.allencounty.in.gov/AgendaCenter/ViewFi...
Background Check Regulations
Federal FCRA requirements govern most employment background checks, and Indiana imposes additional state limits and procedures—such as reporting restrictions, position‑specific screening, and state agency background‑check rules—so employers must follow both federal law and applicable Indiana statutes and policies.
FCRA Compliance Process
Disclosure & Authorization
Provide clear, standalone written disclosure that a background check will be conducted. Obtain separate written authorization from the applicant before ordering the report.
Obtain Background Report
Order the background check from a Consumer Reporting Agency (CRA). Ensure the CRA is FCRA-compliant and provides accurate, up-to-date information.
Pre-Adverse Action Notice
If considering denying employment based on the report, provide the applicant with:
- Copy of the background report
- Copy of "A Summary of Your Rights Under the FCRA"
- Reasonable time to respond (typically 5 business days)
Adverse Action Notice
If final decision is made to deny employment, provide written notice including:
- Name, address, and phone number of the CRA
- Statement that the CRA did not make the decision
- Notice of right to dispute report accuracy
- Notice of right to request additional free copy within 60 days