- Minimum wage
- Tip Minimum Wage
- Tip Pooling and Sharing
- Subminimum Wage
- Montana Minimum Wage Laws 2022 FAQs
- Other State’s Minimum Wage Information
Montana’s current minimum wage is $9.20 for employers with more than $110,000 in annual gross sales.
For employers who have gross annual sales of $110,000 or less, the minimum wage rate is $4.00.
Montana law requires an annual review of its minimum wage, and the minimum wage must be increased by the percentage the cost of living has changed from the prior August to the August in the year the review is conducted.
The cost of living change is based on the consumer price index. Any change to the minimum wage takes effect on January 1 of the following year.
Montana employers must also comply with federal minimum wage laws, which currently set the federal minimum wage at $7.25.
For more information, see FLSA: Minimum Wage.
Suppose an employer chooses to pay employees minimum wage. In that case, the employer must pay those employees in accordance with the minimum wage law, either federal or state, that results in the employees being paid the higher wage.
In most instances in Montana, the Montana minimum wage will apply as it generally guarantees a higher wage rate for employees than federal law.
Tip Minimum Wage
Montana does not have a minimum wage for tipped employees that is lower than the standard minimum wage. Instead, these employees must get paid the standard minimum wage.
Tips are the property of the employee(s) who receive them and may not be used by the employer as part of the employee’s wages.
Montana defines a tip as a sum of money given by a customer to an employee in recognition of services performed. The customer determines the amount of money paid as a tip.
Tips are distinguished from service charges which are fixed amounts added to a customer’s bill in lieu of a tip. MT Statute 39-3-402; MT Admin. Rule 24.16.1508 Service charges must be distributed to nonmanagement employees who participated in preparing and serving the food or beverage pursuant to a tip pool agreement.
Employers may reduce the tips or service charges received by employees from customers by the fee the employers paid to process customers’ credit cards payments for the tips or service charges.
Tip Pooling and Sharing
Montana minimum wage laws do not address whether an employer may require employees to participate in a tip pooling or tip-sharing arrangement.
Employees with Disabilities
Montana law allows employers to pay employees with disabilities a subminimum wage if they are engaged in work that is incidental to training or evaluation programs or their earning capacity is so severely impaired that they are unable to engage in competitive employment. MT Statute 39-3-406(1)(f).
Montana minimum wage laws do not allow an employer to pay trainees a subminimum wage rate that is less than the standard minimum wage.
Montana minimum wage laws allow the Department of Labor and Industry to exempt apprentices from its minimum wage and overtime requirements for no more than the first 30 days of the apprentices’ employment. MT Statute 39-3-406(1)(g).
Montana minimum wage laws allow the Department of Labor and Industry to exempt learners from its minimum wage and overtime requirements for no more than the first 30 days of the learners’ employment. MT Statute 39-3-406(1)(g).
Montana minimum wage laws allow employers to pay learners who are under the age of 18 and who work as farmworkers a subminimum wage that is not less than 50 percent of the standard minimum wage for the first 180 days of employment. MT Statute 39-3-406(h)
Montana minimum wage laws do not allow employers to pay student learners a subminimum wage rate that is less than the standard minimum wage.
Montana minimum wage laws do not allow employers to pay student workers a subminimum wage rate that is less than the standard minimum wage.
Montana Minimum Wage Laws 2022 FAQs
Will Montana undergo a minimum wage increase in 2022?
Yes, and it already did back on the first of January, 2022. Montana’s hourly wage used to be $8.75.
However, after a successful ballot initiative, it had been decided that the minimum wage be increased to $9.20 per hour. It is then planned to have an annual adjustment to determine the fair wage rate.
Will Montana have further minimum wage increases in the future?
Thanks to the ballot initiative, it is now possible to have a minimum wage increase based on inflation. This is something that Montana workers really look forward to since they are currently experiencing the biggest increase they’ve had in years.
If this initiative pushes forward, Montana will soon enjoy an hour minimum wage enough to be considered a living wage. After all, its rate will be determined through various factors: the living wage estimate being one of them.
It also bodes well for businesses in the area since higher wages also mean better purchasing power for Montana’s citizens.
How can businesses in Montana prepare for a minimum wage rate climb?
The first thing that any business owner should do is stay on track with the changing minimum wage regulations and wage & hour laws to ensure compliance. Focusing on employee retention is also a good idea to make the most of your hired talents and minimize turnover costs.
Finally, those who want to determine whether they’re providing the accurate living wage can use a living wage calculator.
This way, you will have an idea of what the next potential increase will look like and ensure that your employees are getting the compensation they rightfully deserve.
Can minimum wage employees freely discuss how much they are paid in Montana?
Yes. In fact, there is a house bill (No. 547) with a provision for employee protection whenever they discuss their set of benefits or wages. By law, they could not be penalized by their employer.