Indiana’s New FAIRNESS Act Bars Employers From Employing Undocumented Immigrants

Quick Hits

• Effective July 1, 2026, Indiana’s FAIRNESS Act bars employers from knowingly or intentionally recruiting, hiring, or continuing to employ unauthorized workers.
• The FAIRNESS Act gives Indiana employers a compliance safe harbor when they use reasonable diligence to verify work authorization before recruiting, hiring, or retaining workers, while allowing the attorney general to seek injunctions and license related penalties if violations are not corrected.
• The FAIRNESS Act authorizes the attorney general to enforce the law through notices, investigations, corrective opportunities, and escalating penalties.

Employer Obligations and Safe Harbor

Under the FAIRNESS Act—the acronym stands for “Forging American Independence, Restoring National Exceptionalism Safely and Securely”—it is unlawful for an “employer” (defined as any person, including an agent, that employs employees in Indiana) to knowingly or intentionally recruit, hire, or continue to employ an “unauthorized alien” on or after July 1, 2026. The term “employ” covers engaging an individual’s services or labor for wages or other remuneration, including suffering or permitting someone to work.

Notably, the FAIRNESS Act, codified at Indiana Code 22-5-9, provides a safe harbor. An employer is not in violation if it engaged in “reasonable diligence” before recruiting, hiring, or continuing to employ the individual. Reasonable diligence includes:

• using an electronic verification of work authorization program operated by the U.S. Department of Homeland Security (i.e., E-Verify) to verify work eligibility, except where circumstances would put a reasonable person on notice that the verification was unreliable; or
• engaging in diligence consistent with industry-standard best practices.

Enforcement and Penalties

The Indiana attorney general (AG) is empowered to enforce the FAIRNESS Act. We anticipate that the AG will use Civil Investigatory Demands (CIDs) to seek information for purposes of FAIRNESS Act investigations. CIDs are a powerful investigatory tool, and preparation for acting promptly is key in case the AG issues an employer a CID.

Before bringing an action for a violation of the FAIRNESS Act, the AG must send written notice of probable cause. The employer then has fifteen business days to either (1) provide evidence of reasonable diligence showing no violation occurred, or (2) submit a corrective affidavit attesting that it has dismissed all undocumented immigrants, confirmed work eligibility for all employees, and will not knowingly employ unauthorized aliens going forward. If the employer satisfies either option, the AG cannot proceed with the action.

If the employer does not satisfy either option and the AG determines that probable cause exists, the AG may bring an action to enjoin the violation and seek additional relief.

The statute establishes a graduated penalty structure tied to an employer’s “operating authorizations” (licenses, permits, certificates, registrations, charters, articles of incorporation, and similar authorizations issued by a state or local governmental body):

• First violation (single): Suspension of all operating authorizations at the location of the violation for five business days.
• First violation (multiple): Suspension at affected location(s) for ten business days.
• Repeat violation: Suspension at affected locations for 180 days.
• After 180-day suspension: Permanent revocation of all operating authorizations at affected locations.
• Willful violations (three or more locations, after prior revocation): Permanent revocation of all operating authorizations statewide.

Courts can also impose probationary status for six months to two years, requiring quarterly compliance reports and sworn affidavits. If an employer violates probation terms, it triggers the applicable operating-authorization penalty. Suspension or revocation of a license does not let an employer off the hook for its tax withholding obligations.

Conclusion

The FAIRNESS Act prohibits Indiana employers from knowingly or intentionally recruiting, hiring, or continuing to employ unauthorized aliens. In light of the FAIRNESS Act’s safe harbor provisions, this is a particularly appropriate time for employers with employees in Indiana to assess their existing employment verification processes and strengthen those processes. In the event an employer receives a CID from the attorney general, it is important that the employer understands its compliance obligations.

Ogletree Deakins’ Indianapolis office will continue to monitor developments and will post updates on the Immigration and Indiana blogs as additional information becomes available.

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