Salary History Ban in Indiana: What Employers Can Ask

Federal law does not prohibit employers from asking about salary history. The Equal Employment Opportunity Commission (EEOC) enforces Title VII of the Civil Rights Act of 1964 (42 U.S.C. § 2000e), which bars discrimination based on protected characteristics (race, color, religion, sex, national origin) but does not address salary history inquiries directly. The Fair Pay Act was proposed federally to ban salary history questions to address wage discrimination and the perpetuation of historical pay gaps, particularly affecting women and minorities, but it has not been enacted into federal law.

The EEOC has issued guidance noting that salary history bans in states and cities are consistent with Title VII's anti-discrimination goals, as prior salary can perpetuate historical discrimination. However, absent a specific federal statute, employers operating in states without bans are free to ask about prior compensation. The Consumer Financial Protection Bureau (CFPB) and Department of Labor (DOL) do not regulate salary history inquiries at the federal level, leaving this area primarily to state and local jurisdiction.

Indiana has not enacted a statewide salary history ban. Indiana Code Title 22, which governs employment law, is silent on the topic of salary history inquiries. This means Indiana employers are not prohibited by state law from asking candidates about their previous compensation during the hiring process.

However, Indiana's approach differs significantly from states like California, Massachusetts, New York, and others that have implemented statewide salary history bans. Those states prohibit employers from asking candidates about prior salary, benefits, or other compensation without the candidate's voluntary disclosure, or from relying on salary history in setting offer amounts. Indiana takes the opposite position: no restriction exists at the state level.

That said, some Indiana cities and municipalities have begun adopting local salary history ordinances. For example, certain Indianapolis-area employers may be subject to local restrictions if their city has passed an ordinance. Employees should check whether their city or county has implemented a local ban. If a local ban applies, employers in that jurisdiction cannot ask about salary history, and the local ordinance would preempt state inaction. State law covers all private employers with no employee threshold requirement, while federal law does not restrict salary history questions at all.

Under Indiana law, remedies for wage discrimination (if proven through other evidence) may include recovery under federal Title VII or state discrimination statutes, but salary history inquiries themselves are not independently actionable under state employment law. Employees cannot sue an Indiana employer solely for asking about salary history unless the inquiry is combined with a discriminatory act based on a protected class, or unless a local ordinance applies and is violated.

Indiana's lack of a salary history ban creates broad exceptions favoring employers. Employers may ask about salary history at any stage of hiring—initial application, phone screen, interview, or offer stage—without legal restriction at the state level. There is no exception requiring confidentiality of prior salary information, and employers may use salary history as a primary factor in setting compensation offers.

A key exception applies if an employee works in a municipality that has passed a local salary history ordinance. In such cases, the local rule supersedes state inaction. However, even in municipalities with bans, exceptions may exist for internal transfers or promotions, where an employer may use an employee's current salary without restriction. Some local ordinances include carve-outs for employees who voluntarily disclose prior salary unprompted.

Another important exception is that salary history bans, where they exist, do not prevent employers from discussing the candidate's expected salary or negotiating offer amounts. The ban restricts inquiry about past compensation, not negotiation about future pay. Additionally, if an employer makes a discriminatory decision based on protected class status and salary history is one factor among many, the candidate might bring a discrimination claim, but the salary history inquiry itself would not be the violation—the discriminatory decision would be. Employers may also ask about salary history during background checks conducted by third parties, though this practice may be restricted in cities with robust local ordinances.

Step 1: Document and Preserve Evidence. If an employer asks about your salary history in Indiana, note the date, time, who asked, and the context (phone call, in-person interview, email, application form). If the request is in writing (email, application form, document), save it and take screenshots. Also document your response and any follow-up conversations about salary. Keep records of all job postings, job descriptions, and communications related to the position to show whether salary history was a factor in the offer decision. If you suspect the inquiry was linked to discriminatory animus (e.g., made after you disclosed a protected status), note that connection.

Step 2: Internal Complaint Process and Informal Resolution. If the employer is in a municipality with a local salary history ban, file an internal HR complaint immediately, citing the specific local ordinance. Even in jurisdictions without a ban, raise concerns in writing to HR if you believe the salary history question was pretextual for discrimination. Send a formal email outlining your concern and request a written response. This creates a record and may prompt the employer to address the issue internally. Give the employer a reasonable opportunity (7-14 days) to respond. Request clarification on how salary history will be used in compensation decisions. If the position was not offered or you received a lower offer than expected, explicitly ask whether prior salary influenced the decision.

Step 3: File with the Appropriate Agency. If you are in an Indiana city with a local salary history ban and the employer violated it, file a complaint with your city's human resources or civil rights department. Search your city's website for "salary history ordinance" or contact the city clerk's office for the complaint process and agency contact. If discrimination is involved (e.g., salary history question was asked only of minority candidates), file a charge with the U.S. Equal Employment Opportunity Commission (EEOC) within 180 days of the violation (or 300 days if your state has a deferral agency, though Indiana does not have one covering private employers). The EEOC accepts charges online at www.eeoc.gov/file-charge or by mail to the nearest EEOC office. For Indiana, contact the EEOC Chicago District Office (which covers Indiana) at 1-800-669-4000 or visit www.eeoc.gov/field-office. You must file with the EEOC first before pursuing federal court litigation. Include in your complaint: your name, employer name, date of violation, description of what was asked, any written materials, names of witnesses, and how you were harmed (e.g., lower offer, non-hire).

Step 4: Investigation Process and Timeline. The EEOC will acknowledge receipt of your charge and assign it a number. The agency investigates by requesting documentation from the employer, which typically takes 30-60 days. The employer will be notified of the charge and given an opportunity to respond. The EEOC may interview you and witnesses, request payroll records, job postings, and communications. The investigation period is usually 6-12 months, though it can extend longer for complex cases. You will receive a "Right to Sue" letter after investigation concludes, allowing you to file a private lawsuit. If the EEOC finds reasonable cause, it may attempt conciliation (settlement negotiation). If a local ordinance was violated, the city's civil rights department will conduct a parallel investigation, which may move faster (30-90 days) than the EEOC.

Step 5: When to Consult an Attorney. Consult an employment law attorney immediately if: (1) the salary history inquiry is part of a pattern of discriminatory conduct (questions about age, race, family status, disability); (2) you were not offered the job or received an offer substantially below market rate or below what similarly situated candidates received; (3) the employer admitted in writing that salary history influenced the decision; or (4) you work in a municipality with a local ban that was clearly violated and you suffered economic harm. An employment law attorney can review the facts, advise on whether you have a viable claim under discrimination law or local ordinance, and represent you in EEOC proceedings or civil litigation. Consultations are often free, and many employment attorneys work on contingency (paid only if you win or settle).