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Carla Tardi is a technical editor and digital content producer with 25+ years of experience at top-tier investment banks and money-management firms.
Updated August 19, 2024 Reviewed by Reviewed by Michael J BoyleMichael Boyle is an experienced financial professional with more than 10 years working with financial planning, derivatives, equities, fixed income, project management, and analytics.
Indentured servitude is a form of labor in which an individual is under contract to work without a salary for a certain timeframe to repay a loan. Such a contract was historically known as an indenture.
Indentured servitude was popular in the United States in the 1600s as many European immigrants worked in exchange for the price of passage to America. Today, indentured servitude is illegal in the U.S. and banned in nearly all countries.
Indentured servitude served as a type of barter system for many immigrants. An individual who sought a new life in America, but who could not afford the steamship fare from another country, could contract with a wealthy U.S. landowner to perform a type of work for a fixed period in exchange for the price of the boat ticket.
Approximately 300,000 European workers immigrated to the American colonies in the 1600s as indentured servants, and indentured servitude continued throughout much of the 1700s.
Indentured servitude in the U.S. began in the early 1600s in Virginia, not long after the settlement of Jamestown. Many early American settlers sought cheap labor to help manage their large estates and farms, and commonly agreed to fund the passage of European immigrants to Virginia in exchange for their labor.
Other parts of the world also engaged in indentured servitude at the same time that it was occurring in the United States. Many also left Europe for the Caribbean to work as indentured servants on sugar plantations.
Contracts—also known as indentures—stipulated that a worker would repay the loan to the lender by performing a certain kind of labor for a set period. Skilled laborers were usually indentured for four or five years, but unskilled workers often needed to remain for seven or more years.
The indentured servitude system permitted landowners to provide only food and shelter for indentured servants, as opposed to wages. Some landowners offered their servants basic medical care, but typically labor contracts did not provide for this.
Some indentured servants served as cooks, gardeners, housekeepers, field workers, or general laborers, while others learned specific trades such as blacksmithing, plastering, and bricklaying, which they often parlayed into future careers.
Most workers who became indentured servants were males, generally in their late teens and early twenties, but women also entered into these agreements and often worked as household employees or domestic servants.
Although some indentured servants completed their contracts and received land, livestock, tools, and other necessities, many others did not live to pay off their contracts because they perished from diseases or work-related accidents or fled before completing their terms of service.
Indentured servants enjoyed little personal freedom and some contracts allowed landowners to extend the work period for servants who were accused of behavior that was deemed improper.
Indentured servitude historically referred to agreements between apprentices and master tradesmen, with the apprentice working for free to learn a trade. It evolved as a way for an individual to pay the cost of transportation to the American colonies. Workers were commonly bought and sold when they arrived at their destinations. Great Britain used indentured servitude as a punishment for captured prisoners of war in rebellions and civil wars.
Until the late 18th century, indentured servitude was common in America and a common way for Europeans to immigrate to the colonies. The system was also used to exploit Asian immigrants who were used mainly to construct roads and railway systems.
Over one-half of all European immigrants to the American colonies between the 1630s and the American Revolution came under indentures. Many young children were taken from England to the American colonies as indentured servants, often kidnapped off the streets and sent off as merchandise to be sold as servants in the New World.
Both the American and British governments passed laws that helped the decline of indentured servitude. The United Kingdom's Passenger Vessels Act of 1803 regulated travel conditions aboard ships to make transportation more expensive and an American law passed in 1833 abolished the imprisonment of debtors, which made prosecuting runaway servants difficult.
The 13th Amendment to the U.S. Constitution prohibited most forms of involuntary labor, except as punishment for a crime. Although it does not specifically refer to indentured servitude, the Supreme Court has interpreted the amendment to include compulsory labor in repayment of debt.
However, informal debt bondage continued in the form of sharecropping and black codes. Though officially free, tenant farmers were unable to leave until they had repaid debts to the owners of the land where they worked. Since these debts tended to grow over time, the sharecropping system effectively replaced chattel slavery with an informal system of debt bondage.
Outside the United States, indentured servitude was prevalent in the British colonies, which relied on migrant labor to staff its sugar plantations after the abolition of slavery. Around 500,000 indentured laborers were transferred to the Caribbean between 1837 and 1917, when the practice was officially abolished.
Virginia and Maryland operated under the "headright system" where incentives, such as 50 acres of land, were provided for planters to import workers. This system was used by wealthy plantation aristocrats to increase their land holdings.
Immigrants often entered indentured servitude contracts of their own free will, as opposed to slaves, who did not. Both slaves and indentured servants could be sold, loaned, or inherited.
The treatment of indentured servants differed greatly from one master to another. Some masters considered their indentured servants as personal property and made these individuals work difficult jobs before their contracts expired.
Others treated slaves more humanely than their indentured servants because slaves were regarded as a lifetime investment and servants would leave within a few years.
Indentured servants did have limited rights including access to the courts and entitlement to own land. However, masters retained their right to prohibit their servants from marrying and had the authority to sell them to another master at any time.
A modern form of indentured servitude still exists in the form of debt bondage, also known as bonded labor, where people work for low or no wages in repayment of a debt. This may be for a debt that the worker agreed to work off as a condition for receiving a loan or advance, or a debt that was inherited.
Although prohibited by U.S. law, unethical employers may take advantage of a person's migrant status to compel work in repayment of a debt. If such conditions violate labor laws or other rights, this may be considered a form of human trafficking.
People in debt bondage may endure slavery-like conditions, like being forced to stay on the employer's premises, denied access to the authorities, or being subject to physical or psychological abuse. There are no exact figures, but the U.N. estimates that around 21 million people are subject to some form of forced labor. Debt bondage is the most prevalent type.
After serving their time as servants and paid with meals and housing, indentured servants were given "freedom dues" which often included a piece of land and supplies.
Indentured servants often served as field workers, gardeners, cooks, and laborers.
An indenture is a contract and for indentured servants, these contracts contained "indented" marks along the sides of the document. When the document was finalized, two copies were made. One copy was placed over the other and the edges of the pages were defaced or marked with indented characters. Servants were often uneducated and could be cheated so marking the two original copies helped to ensure a lasting means of authenticating the contract.
Indentured servitude is a labor contract in which an individual works without compensation to repay an indenture or loan over some time, commonly several years. Indentured servitude was popular in American colonies as many worked in exchange for the price of passage to America. Following the Civil War, the 13th Amendment made indentured servitude illegal in the United States.
