Running a compliant operation in Montana means keeping a close eye on tipped wages and tip credits.
State requirements can interact with federal standards, and in some areas, local rules may layer on additional obligations for employers.
Montana’s wage and hour regulations balance simplicity with fairness.
The state maintains its own indexed minimum wage and largely follows federal standards for other employment laws. Employers must pay attention to annual rate adjustments and ensure written policies govern areas like PTO payout, reimbursements, and breaks.
Whether managing employees directly or through an Employer of Record (EOR) like HireArt, compliance with Montana’s labor laws helps employers maintain transparency and reduce risk.
This blog is based on information available to HireArt as of October, 2025. HireArt does not provide tax, accounting or legal advice. This material has been prepared for informational purposes only, and should not be relied on for, tax, legal or accounting advice. Consult your own tax, legal and accounting advisors before engaging in any related activities or transactions.
Montana sets a statewide minimum wage that adjusts annually based on inflation.
As of 2025, the minimum wage is $10.55 per hour. This indexed system ensures the rate keeps pace with the cost of living. The state does not permit local jurisdictions to establish separate minimum wage ordinances, so the statewide rate applies uniformly.
Employers must follow the higher applicable rate between state and local law.
Montana does not require employers to provide paid sick leave.
Employers are free to design and administer their own sick leave or PTO programs, provided they comply with federal wage and hour rules. Employers should document their policies clearly to ensure fair and consistent application across the workforce.
Montana maintains a consistent labor framework statewide.
There are no city or county ordinances that exceed or supplement state wage or leave requirements, as local governments are limited from enacting independent labor laws. Employers benefit from this consistency when operating in multiple regions of the state.
Montana does not have a statewide law requiring meal or rest breaks for adult employees.
Employers should establish their own policies, adhere to any applicable collective bargaining agreements (CBAs), and follow the federal Fair Labor Standards Act (FLSA) for general guidance. Providing regular rest and meal periods remains a best practice for supporting employee health and productivity.
Payout of unused paid time off (PTO) at termination is governed by the employer’s written policy or employment contract.
If an employer’s policy treats accrued vacation or PTO as earned wages, it must be paid upon separation. Clear documentation of how PTO is earned and paid out helps employers stay compliant and avoid disputes at termination.
Reimbursement rules in Montana are policy-driven.
There is no specific statewide statute requiring employers to reimburse business-related expenses. Employers should maintain written policies that define reimbursable expenses—such as travel, mileage, or tools—and outline reimbursement procedures.
Employers in Montana must provide detailed wage statements and ensure final pay is issued promptly.
Maintaining accurate payroll records supports compliance and fosters trust between employers and employees.
Montana applies both federal and state economic-realities tests to determine worker classification.
If an employer exercises significant control over how, when, and where work is performed, the individual must be classified as an employee (W-2). Misclassification can result in back wages, fines, and penalties under state and federal law.
HireArt acts as an Employer of Record (EOR) to help companies manage compliance with Montana’s employment laws. Through HireArt, employers can:
By partnering with HireArt, employers can simplify HR processes, reduce administrative risk, and maintain a consistent, compliant employment experience across Montana.
