Employment and labor laws in Montana [Updated 2023]

Published

Nov 27, 2023

United States employment laws are intended to protect workers from unfair working conditions, hazardous environments, exploitation, and discrimination. Should employers breach these laws, they can face penalties, lawsuits, and other consequences. Still, despite federal laws that are applicable nationwide, each state often has its own laws with more specific obligations. Sometimes, regulations can even vary from city to city.

If you’re planning to expand operations into Montana, whether you’re hiring in Billings, Missoula, Bozeman, or Butte, you must understand and comply with the laws of the Treasure State. Read on to learn more about the state’s employment and labor laws. 

If you’re worried about staying compliant with Montana state laws, check out Rippling’s Professional Employer Organization service. Rippling can take on your local tax registration and management work, eliminating compliance concerns so you can grow your business quickly.

Employment vs. labor law: What’s the difference?

“Employment law” and “labor law” are often used interchangeably. However, while they do share some characteristics, their meanings are distinct. While employment law is about the relationship between employers and the individuals they hire, labor law is about issues between employers and a group of individuals, like unions.

Here’s more at a glance:

  • Employment law encompasses overtime laws, wage rates, work hours, recruitment practices, retaliation against employees, and discrimination.
  • Labor law is a subset of employment law. Labor law deals specifically with groups of workers, including topics like union membership, union dues, and collective bargaining agreements (CBAs).

Wages and hours in Montana

Minimum wage regulations help ensure that employees receive fair pay, while overtime laws ensure that eligible workers are fairly compensated for working beyond the standard 40-hour workweek. 

Minimum Wage in Montana

Many states, including Montana, have a higher minimum wage than the federal minimum wage of $7.25 per hour. The Montana minimum wage is $9.20 per hour.

Some states have a lower minimum wage for tipped workers, such as restaurant servers. However, Montana doesn’t allow tip credits. Therefore, tipped employees must receive minimum wage. Under Montana’s child labor laws, minors may be paid the youth minimum wage of $4.25 per hour for their first 90 days of work; they must be paid the full minimum wage after that period.

Wage law can be complicated to navigate, especially if you’re hiring across multiple states. The good news is that whether your employees are based in the state of Montana or elsewhere, Rippling automatically flags any minimum wage violations based on your employees’ locations when you’re setting hourly wages.

Overtime pay in Montana

Montana follows federal Fair Labor Standards Act (FLSA) provisions regarding overtime hours. That means employees who work more than 40 hours per workweek are entitled to 1.5x their regular rate of pay for all extra hours worked.

Workers who are exempt from Montana overtime pay under FLSA include professional employees, executives, administrative employees, computer workers, and outside salespeople, as long as they are paid at least $684 per week.

Adhering to overtime pay laws in Montana is simple with Rippling’s payroll software. Rippling automatically applies the correct pay rates when an employee’s hours trigger overtime pay requirements.

Pay transparency in Montana

Pay transparency is the practice of openly sharing information about compensation with employees and job applicants. This may include salary ranges, wage structures, and other related data. The aim of pay transparency is to promote fairness, provide greater insight into compensation structures, improve equity, and enhance trust between employers and employees.

While the state of Montana doesn’t yet have pay transparency laws, the legislature considered a pay transparency bill in 2023. With more and more states adopting pay transparency measures each year, some companies are implementing full or partial pay transparency as a way to stay ahead of regulations.

Rippling can help with compensation band enforcement to promote pay equity. During the onboarding process, Rippling flags out-of-band adjustments, so you can accept special cases and deny others.

Breaks and rest periods in Montana

Montana has no regulations compelling employers to provide break time to their workers. However, many employers choose to offer rest or meal breaks to allow employees to relax and recharge. If employers do choose to allow breaks, then certain rules apply. First, breaks of 20 minutes or less are considered working time and must be paid. Meal periods can only be unpaid if they are at least 30 minutes long and, during that time, employees are completely relieved of their work duties.

Under federal law, Montana employers must allow breaks for employees who are breastfeeding. Employers must provide suitable facilities and enough time for employees to express milk. State law prohibits discrimination against employees who pump or express milk at work.

Leaves of absence in Montana

When employees are recuperating from sickness, welcoming a new child, or managing other personal issues, they may need to take leave from work. In Montana, several types of leave are allowed.

All employers in Montana must provide:

  • Family and medical leave: Under the Family and Medical Leave Act (FMLA), certain employees are eligible for 12 weeks of unpaid leave for birth, maternity leave, paternity leave, adoption or fostering a child, caring for a family member who is ill, or other life events. The employee must have worked for the employer for 12 months before they are eligible for this type of leave.
  • Jury duty leave: This is an entitlement for all employees, which can be unpaid.
  • Military leave: Under the Uniformed Services Employment and Reemployment Rights Act (USERRA), all employees are eligible for unpaid military leave with job protection. What’s more, under the Montana Military Service Employment Rights Act (MMSERA), public employees are entitled to earned paid military leave.
  • Crime victim leave: This includes employees who are victims of crimes or employees who need to assist family members who are victims of crimes.

Private employers aren’t required to provide sick leave, bereavement leave, vacation leave, holiday leave, or emergency response leave. Still, many do offer these additional types of leave as a perk for employees.

Pregnancy disability leave in Montana

While pregnancy disability leave isn’t required in Montana, employees may use some of their family and medical leave to take time off during pregnancy.

Paid sick leave in Montana

Sick leave isn’t required in Montana. However, providing sick days (whether paid or unpaid) is a common employee perk.

Automate and customize your leave policy with Rippling and get full visibility into how your employees are utilizing their leave.

Workplace safety in Montana

In the United States, employers are responsible for providing and maintaining safe work environments. They must provide safe equipment, protective gear, safety training, and safety policies.

The federal Occupational Safety and Health Administration (OSHA) has an office in Billings that oversees private-sector employers and their workforce. What’s more, the Montana Safety Culture Act (MSCA) of 1993 requires that all employers develop Safety, Health, Injury & Illness Prevention Plans (IIPP), which includes providing all their workers with general safety orientations, job-specific safety training throughout the employment cycle, and tools such as newsletters or posters to enforce safety protocols. Employers must also keep up-to-date documentation about activities and safety. Employers with more than five employees (which includes temporary, leased, and seasonal workers) have additional responsibilities, including establishing a safety committee.

Montana has strong workers’ compensation laws. All employers with more than three employees must provide insurance for their full-time, part-time, and seasonal workers with only a few exemptions.

If you need to carry workers' compensation insurance for your Montana employees but are worried about the expense, Rippling’s PEO offers a convenient pay-as-you-go workers’ comp plan. With Rippling, you don’t need to pay upfront for a whole year—so you can grow your business in Montana and elsewhere in the US without the stress or hassle.

Discrimination and harassment laws in Montana

Federal and state laws prohibit discrimination against employees for belonging to protected classes. This prevents discrimination throughout the employee lifecycle, including hiring, providing pay and benefits, promotions, discipline, and termination. Under the Montana Human Rights Act, employers can’t discriminate against job applicants or current employees on the basis of:

  • Race
  • Color
  • Religion
  • Creed
  • Sex
  • Age
  • National origin
  • Mental disability
  • Marital status

Discrimination may manifest in unjust hiring practices, wage disparities, promotion denials, or other prejudiced treatment. Workplace discrimination fosters an atmosphere where individuals face unequal treatment solely based on their identity or background—in addition to being illegal, it’s toxic and demoralizing to your team.

Workplace harassment happens when a hostile or intimidating environment is created via unwelcome conduct. This includes offensive comments, gestures, slurs, or actions that generate feelings of discomfort, fear, or humiliation.

Though sexual harassment training isn’t required of Montana employers, the Montana Department of Labor and Industry strongly recommends it. They also recommend written harassment policies, plans for how reports will be investigated, and informing employees and clients of their right to report sexual harassment to the Montana Human Rights Bureau.

Remember, in Montana, companies may be liable for sexual harassment committed by owners, executives, and managers, along with supervisors, coworkers, and even outside vendors and customers. Sexual harassment training requirements vary by state, which is why Rippling’s Learning Management System comes loaded with core sexual harassment training courses to meet the state requirements of any employee.

Unions in Montana

What is a labor union? This collective of employees within a company or across an industry works together to advocate for equitable or improved working conditions. They may aim to improve wages, time off, benefits, and more. Under the National Labor Relations Act (NLRA), employees throughout the US are allowed to:

  • Unionize or join a pre-existing union as a way to negotiate with their employer.
  • Collectively bargain by voting for employee representatives.
  • Discuss employment terms with coworkers and colleagues.
  • Seek better working conditions by getting help from the union or filing complaints with employers or the government.
  • Engage in strikes and picketing for valid reasons.
  • Opt out of joining a union.

Labor unions may not coerce employees into joining their efforts by threatening job loss or other punishments. Similarly, employers may not obstruct, discourage, coerce, terminate, demote, or menace any employees who join or express an interest in joining a union.

The Public Employees Collective Bargaining Act gives Montana employees the right to bargain. Unions are very common in Montana. For example, Billings has three city labor unions, representing more than 75% of the city’s employees. Additionally, Montana is not a “right-to-work state,” meaning that union membership may be a condition of employment. 

FAQs about Montana labor and employment laws

Are independent contractors covered under Montana employment laws?

No, independent contractors (also referred to as self-employed individuals, freelancers, gig workers, or contract workers) do not benefit from the safeguards provided by Montana state employment law. Therefore, they are exempt from minimum wage, overtime, leave regulations, and other employee protections.

Our analyzer tool helps ensure you classify workers correctly and comply with employment regulations.

Does at-will employment exist in Montana?

No. While most other states follow “at-will employment” standards, meaning that employees and employers can terminate their working relationship at any time and for any (non-discriminatory) reason, Montana has its own regulations. Under the Wrongful Discharge from Employment Act, employees can quit at any time, but their jobs are protected if they have completed probationary periods of up to 18 months. If employers would like to terminate those protected employees, they must provide evidence of “good cause.”

What privacy rights do employees have in Montana?

Employee privacy is protected under the Montana Constitution. Employers aren’t allowed to record conversations or monitor emails or other electronic communications without the knowledge and consent of their workers. Employers are limited in their ability to check the social media profiles of employees or job applicants. For example, they can’t ask for social media passwords or other information that would grant them access to such accounts. 

Are background checks legal in Montana?

Yes, background checks are legal in Montana, though employers must stay within the bounds of the Fair Credit Reporting Act (FCRA). Under the FCRA, job applicants must be notified about what information will be sought and must agree to the background check. 

Drug and alcohol testing of employees is allowed if employers have a written policy about such tests and pay for the tests to be conducted. Polygraph testing is not permitted in Montana as a condition of hiring or employment. 

Are whistleblowers protected in Montana?

Yes, the state of Montana offers certain protections for whistleblowers, individuals who expose or report information about unethical, illegal, or dishonest activities within their workplace. 

Whistleblowers are protected under the Montana False Claims Act if they report the misuse of government funds or fraudulent payments. Employees who report such abuse and are subject to retaliation may be owed reinstatement, doubled back pay with interest, and compensation for damages. What’s more, under the Whistleblower Award and Protection Act, whistleblowers may even be given a payout of a percentage of money recovered by the state as a result of their reporting.

Is workers’ compensation coverage required in Montana?

Yes, all employers in Montana with three or more employees must get workers’ compensation insurance. Employers with any number of employees in the construction industry are compelled to get workers’ comp insurance, too. 

Under the Workers’ Compensation Act, employers aren’t allowed to retaliate against employees who seek coverage for workplace injuries or illnesses. If employers violate that rule, they may be fined by the Second Injury Trust Fund.

Are there required healthcare benefits in Montana?

While the Affordable Care Act (ACA) mandates health insurance plans at the federal level, employers aren’t required to provide healthcare benefits for their Montana employees if they have fewer than 50 full-time employees. Those with 50+ full-time employees do need to offer some form of health insurance, or else they may face penalties. 

Are Montana employers required to provide bereavement leave?

No, employers aren’t required to provide bereavement leave in Montana.

What employee protections are available in Montana if layoffs occur?

If employers plan to enforce mass layoffs or close a plant, they owe affected employees at least 60 days’ notice under the Worker Adjustment and Retraining Notification Act (WARN Act). When employees get laid off, they’re typically owed their final paycheck with full payment, plus any applicable vacation time payouts. However, there may be additional employee protections for union members.

Disclaimer: Rippling and its affiliates do not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.

last edited: November 29, 2023

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