Indiana
Indiana: Updates to Employment Eligibility Verification, Unemployment Insurance, and Youth Workers Rules
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APPLIES TO As Indicated |
EFFECTIVE JUL 1, 2026 |
QUESTIONS? Contact HR On-Call |
Quick Look
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Discussion
The Indiana legislature passed several bills impacting employer obligations. Key details are summarized below.
Employment Eligibility Verification. Effective July 1, 2026, SB 76 makes it unlawful for an employer to knowingly or intentionally recruit, hire, or continue to employ an unauthorized alien. The law allows the state’s Attorney General to bring an enforcement action against an employer if probable cause exists that the employer has violated the law’s recruitment and hiring restrictions. The law also prohibits an employer from discharging or discriminating against an employee because the employee communicated or cooperated with the attorney general in connection with an investigation.
Unemployment Insurance. Two bills impact Indiana employers’ unemployment insurance reporting obligations beginning July 1, 2026:
- SB 162 will require Indiana employers to notify the Department of Workforce Development if an employee separates from employment for any of the following reasons: voluntarily left the employment without good cause; discharged for just cause; discharged for gross misconduct in connection with the employee’s work; left due to the employee’s physical condition; left to accept other employment; or left to enter self-employment.
- SB 214 amends the state’s unemployment insurance tax law to clarify how certain payments are treated as taxable wages subject to contributions, including meals and lodging provided as additional remuneration, wages in lieu of notice, back pay awards, commissions, certain bonuses, and reported tips over $20. The amendments confirm that other payments, such as employee discounts, certain travel reimbursements, and unreported tips, are not subject to contribution. The amendments also significantly expand the information required on quarterly contribution reports, adding new per-employee data fields including start date, physical worksite zip code, full-time or part-time status, weekly payroll presence, and applicable Standard Occupational Classification code, in addition to existing wage and identification information. Employers should be aware that late or missing quarterly reports may result in DWD-estimated assessments plus a $25 penalty per report, and that the DWD may require electronic payment of contributions and, in certain circumstances, accelerate contribution due dates with at least 30 days’ notice.
Youth Workers. Effective July 1, 2026, HB 1302 discontinues the state-run Youth Employment System (YES) and ends employer reporting of teen workers (aged 14 to 17). The Indiana Department of Labor will no longer maintain the YES database or require employer registration or updates for minor workers.
Action Items
- Review recruitment, hiring, and employment eligibility verification practices for compliance.
- Review and update employee separation notification procedures.
- Review payroll systems and consult with payroll provider regarding compliance with reporting for new per-employee data fields.
- Review youth worker reporting practices, as applicable.
- Have appropriate personnel trained on the updated requirements.
Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase