Indiana FAIRNESS Act Targets Unauthorized Hiring

On March 5, 2026, Indiana enacted Senate Enrolled Act 76 (SB 76), also known as the FAIRNESS Act, as Public Law 106, creating new state-level penalties for employers that knowingly or intentionally recruit, hire, or continue to employ unauthorized workers in Indiana.

The law authorizes the Indiana Attorney General to investigate suspected violations and seek court-ordered remedies, including suspending or revoking an employer’s operating authorizations, such as licenses, permits, or registrations.

This update applies to any employer that recruits, hires, or employs workers in Indiana, regardless of industry or size, and takes effect on July 1, 2026.

What Employers Need to Do

• Review Form I-9 completion, retention, and audit practices to ensure consistent and timely employment eligibility verification for all Indiana hires.

• Evaluate whether the use of E-Verify may assist in demonstrating reasonable diligence under the law’s defense provisions.

• Ensure individuals responsible for verifying work authorization are trained to apply consistent practices and escalate any concerns promptly.

• Create or update a response process for Attorney General inquiries, including who is responsible for receiving requests, gathering documentation, and coordinating with legal counsel.

• Reinforce anti-retaliation protections, because the law prohibits discharging, discriminating against, or retaliating against employees who communicate or cooperate with the Attorney General about compliance.

Overview

What is Prohibited:

• Employers may not knowingly or intentionally recruit an unauthorized worker, hire an unauthorized worker, or continue to employ a worker after the employer knows the worker is not authorized to work in Indiana.
• The “continue to employ” language means risk does not stop at hiring; if an employer learns during employment that a worker lacks authorization, keeping the worker on payroll may create exposure.

Who is Covered: The law applies broadly to employers operating in Indiana, including those that recruit, hire, or employ workers in the state. Coverage is not limited by industry or employer size.

Enforcement Authority: The Indiana Attorney General is authorized to investigate suspected violations and bring enforcement actions, including requests for information and court-ordered remedies if probable cause is found.

Penalties

• First-time Single Violation: Possible five-business-day suspension of operating authorizations at the affected location.
• Multiple First-time Violations: Possible 10-business-day suspension.
• Repeat Violations: Possible 180-day suspension.
• Willful or Serious Repeat Violations: Possible permanent revocation of all Indiana operating authorizations.

Reasonable-Diligence Defense: Employers may reduce liability by showing they took reasonable steps to verify work authorization before recruiting, hiring, or continuing employment. Use of E-Verify or industry-standard verification practices supports this defense.

Anti-Retaliation Protection: Employers may not discharge, discriminate against, or retaliate against an employee for communicating or cooperating with the Attorney General about compliance with the law.

Why This Matters

The FAIRNESS Act creates a state-level enforcement framework that goes beyond traditional fines; penalties can affect an employer’s ability to operate in Indiana by suspending or revoking licenses, permits, and registrations. Because the law also reaches continued employment, not just hiring, ongoing verification practices and audit readiness become as important as onboarding procedures.

Key Risks for Employers

• Violations carry escalating suspension periods. Five business days for a first-time single violation, 10 business days for multiple first-time violations, 180 days for repeat violations, and permanent revocation of all Indiana operating authorizations for willful or serious repeat violations.

• Enforcement risk does not end at hiring; learning that a current employee lacks authorization and keeping them employed may trigger the same suspension and revocation penalties above, applied to ongoing employment rather than initial hiring.

• The Indiana Attorney General may investigate suspected violations, issue information requests, and seek court-ordered remedies, meaning employers may face investigation and litigation costs even before a final suspension or revocation decision.

• Discharging, discriminating against, or retaliating against employees who communicate or cooperate with the Attorney General about compliance may create separate liability under the anti-retaliation provision, including additional enforcement actions and remedies.

Additional Information

The FAIRNESS Act also includes broader immigration enforcement provisions affecting government bodies, law enforcement, and post-secondary institutions, prohibiting policies that restrict cooperation with federal immigration enforcement.

A federal court reportedly denied a preliminary injunction on June 18, 2026, challenging parts of the law focused on detainer requirements, however, that litigation appears focused on the public-sector cooperation provisions, not the employer sanctions portion, so Indiana employers should not assume the employer provisions are delayed unless a court order specifically blocks them.

Source References

• Indiana SB 76 – Immigration matters.

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