A method for regulating operation of an induction motor having a rotor includes calculating a rotor flux angle error value, via a flux observer of a controller, using estimated d-axis and q-axis flux values of the rotor, estimating rotor position using a position observer of the controller, and calculating slip position of the rotor using d-axis and q-axis stator currents. The method also includes estimating a rotor flux angle as a function of slip position and estimated rotor position, calculating a corrected rotor flux angle by selectively adding the rotor flux angle error value to the estimated rotor flux angle, and controlling output torque of the motor using the corrected rotor flux angle. A logic switch may be used to selectively add the rotor flux angle.