Montana Minimum Wage 2026
⚠️Informational only — not legal or tax advice.
Last Updated: February 10, 2026
Last Reviewed: February 10, 2026
Applicable Period: 2026
Jurisdiction: State of Montana, United States
Update Schedule: Quarterly reviews in 2026; annual reviews thereafter
Table of Contents
- Introduction
- Montana Minimum Wage – 2026 Quick Reference
- Overview of Minimum Wage Law in Montana
- Current Minimum Wage Rates in Montana 2026
- Minimum Wage for Tipped Employees
- Local Minimum Wage Ordinances in Montana
- Who Is Covered and Who Is Exempt
- Employer Obligations and Enforcement
- Montana Minimum Wage vs Federal Law
- Minimum Wage Posting Requirements
- Frequently Asked Questions
- Information Verification Log
Introduction
The minimum wage in Montana establishes the lowest hourly compensation that employers must legally provide to covered employees. For 2026, Montana maintains a minimum wage of $10.85 per hour, with annual adjustments based on the Consumer Price Index. Montana does not allow tip credits and requires employers to pay the full minimum wage to all employees, including those who receive tips.
Minimum wage regulations in Montana operate under Montana Code Annotated § 39-3-404 and § 39-3-409 alongside federal requirements established by the Fair Labor Standards Act (FLSA). When state minimum wage rates exceed the federal standard, employers must comply with the higher state rate. Montana does not allow tip credits, and no local jurisdictions have enacted separate minimum wage ordinances.
This page provides an authoritative overview of Montana minimum wage law for 2026, including current rates, scheduled increases, tipped employee provisions, employer exemptions, coverage and exemptions, enforcement procedures, and compliance requirements. All information is compiled from official government sources.
| Montana Minimum Wage – 2026 Quick Reference | |||
|---|---|---|---|
| Category | Rate | Effective Date | Official Source |
| State minimum wage | $10.85/hour | January 1, 2026 | Montana Code § 39-3-409 |
| Tipped minimum wage | $10.85/hour | January 1, 2026 | Montana DLI |
| Tip credit allowed | No | — | Montana statute |
| Next scheduled increase | TBD | September 30, 2026 | MCA § 39-3-409 |
| Rate adjustment mechanism | CPI-indexed | Annual | Montana statute |
| Small business rate | $4.00/hour | Ongoing | Montana Code § 39-3-409 |
| Federal minimum wage | $7.25/hour | July 24, 2009 | U.S. DOL |
| Local minimum wages | No | — | State law |
Last verified: February 10, 2026 via Montana Department of Labor & Industry website
Overview of Minimum Wage Law in Montana
Legal Authority
Montana minimum wage requirements are established under Montana Code Annotated Title 39, Chapter 3, Part 4, specifically § 39-3-404 and § 39-3-409. The Montana Department of Labor & Industry administers and enforces minimum wage regulations through its Employment Relations Division. Montana’s minimum wage law was significantly amended through a voter-approved initiative in 2006 that established automatic annual cost-of-living adjustments.
Relationship to Federal Law
Under the Fair Labor Standards Act (FLSA), the federal minimum wage establishes a floor of $7.25 per hour for covered employers and employees. Montana law operates independently of federal minimum wage standards and establishes its own rate determination mechanism. When both state and federal minimum wage laws apply, employers must pay whichever rate is higher.
Because Montana’s minimum wage of $10.85 exceeds the federal minimum, most covered employers must comply with the state rate. Montana statute § 39-3-409 specifically requires that the state minimum wage be the greater of either the federal rate or the Montana rate as adjusted for cost-of-living increases.
Coverage Scope
Montana minimum wage law applies to all employers operating in Montana, with limited exceptions for small businesses not covered by federal law. The law covers both private and public sector employees. Specific industry exemptions include certain agricultural workers and executive, administrative, and professional employees meeting both salary and duties tests. Employers not subject to state minimum wage requirements but covered by federal law must comply with FLSA standards.
Higher Rate Principle
The principle of “higher prevailing rate” requires employers to pay the highest applicable minimum wage—whether federal, state, or local. In Montana, this means employers must identify and apply whichever minimum wage rate provides employees the highest hourly compensation. Since Montana has no local minimum wage ordinances, the comparison is limited to federal versus state rates, with the $10.85 state rate prevailing for most employees.
Current Minimum Wage Rates in Montana 2026
Standard Hourly Minimum Wage
As of January 1, 2026, the standard minimum wage in Montana is $10.85 per hour for covered employees. This rate applies to all non-exempt employees working in Montana, regardless of employer size, with limited exceptions for very small businesses not covered by federal law.
Montana adjusts its minimum wage annually based on the Consumer Price Index for All Urban Consumers (CPI-U) as calculated by the U.S. Bureau of Labor Statistics. The Montana Department of Labor & Industry calculates the cost-of-living adjustment based on the increase in the CPI from August of the preceding year to August of the year in which the calculation is made. The adjustment is announced no later than September 30th and becomes effective the following January 1st. The 2.8% increase from 2025’s rate of $10.55 reflects inflation adjustment for the August 2024 to August 2025 period.
If there is no increase in the Consumer Price Index, no adjustment is made to the minimum wage. When an increase occurs, the Department rounds the calculated amount to the nearest five cents to create practical wage increments.
Small Business Exception
Montana law provides a significant exception to the standard minimum wage for qualifying small businesses. Under Montana Code § 39-3-409(3), a business not covered by the Fair Labor Standards Act whose gross annual sales are $110,000 or less may pay $4.00 per hour.
Important limitation: This exception only applies to businesses that are both (1) not covered by the FLSA and (2) have annual gross sales of $110,000 or less. However, if an individual employee of such a business is producing or moving goods between states or is otherwise covered by the Fair Labor Standards Act, that employee must be paid the greater of either the federal minimum wage of $7.25 or Montana’s minimum wage of $10.85.
The small business exception is narrow in practice because most businesses with interstate commerce activity fall under FLSA coverage, which would require payment of at least the federal minimum wage. Employers should verify their classification with the Montana Department of Labor & Industry to ensure proper rate application.
Scheduled Minimum Wage Increases
Montana does not have legislatively scheduled future increases beyond the automatic annual adjustment mechanism. Instead, the minimum wage adjusts each year based on inflation as measured by the Consumer Price Index.
2027 and beyond: Beginning September 30, 2026, the Montana Department of Labor & Industry will calculate the 2027 minimum wage adjustment based on CPI-U data from August 2025 to August 2026. The adjusted rate will be announced and will take effect on January 1, 2027. This process repeats annually, ensuring Montana’s minimum wage keeps pace with cost-of-living changes.
The 2026 Minimum Wage Determination Letter published by the Montana Department of Labor & Industry provides the official calculation methodology and announcement for the current year’s rate. Employers should monitor the Department’s website each fall for the following year’s rate announcement.
Minimum Wage for Tipped Employees
No Tip Credit Allowed
Montana does not permit employers to take a tip credit against minimum wage obligations. All employees, including those who receive tips, must be paid the full state minimum wage of $10.85 per hour before any tips are considered.
This means:
- Tipped employees receive $10.85 per hour as base compensation
- All tips earned are additional compensation beyond the minimum wage
- Employers cannot use customer tips to satisfy minimum wage requirements
- Tips belong entirely to employees and cannot be retained by employers
According to the Montana Department of Labor & Industry, no tip credit, meal credit, or training wage is allowed under Montana’s Wage & Hour Laws. This makes Montana one of several states that require tipped workers to receive the full minimum wage as direct cash compensation.
Tipped Employee Rights
Even though Montana prohibits tip credits, specific rules govern tip handling and distribution:
Tip Ownership: All tips, gratuities, and service charges received by employees are the property of the employee. Under Montana law, employers cannot keep any portion of tips, require employees to share tips with management or supervisors, or deduct credit card processing fees from tips. Tips must be distributed directly to the employees who earned them or according to valid tip pooling arrangements.
Service Charges: Service charges imposed by businesses in the food, beverage, or lodging industry are distinct from voluntary tips. A service charge is defined as an arbitrary fixed charge added to the customer’s bill by an employer in lieu of a tip. Service charges collected by the employer must be distributed directly to non-management employees preparing or serving the food or beverage, or to any other non-management employee who is part of the chain of service. Employers cannot retain service charges as business revenue.
Tip Pooling: Montana law permits tip pooling arrangements where tipped employees share their tips with other employees who contributed to customer service. However, tip pools cannot include managers, supervisors, or other employees in positions of authority who do not directly provide customer service. All participants in tip pools must be non-management employees who regularly receive tips or provide direct customer service.
Recordkeeping: While employers are not required to track individual tip amounts for minimum wage compliance purposes (since full minimum wage must be paid regardless), employers should maintain accurate records of service charges collected and distributed. Employees should keep personal records of tips received for tax reporting purposes.
Local Minimum Wage Ordinances in Montana
Montana law does not authorize cities and counties to enact their own minimum wage rates that differ from the state minimum wage. All employers in Montana must comply with the uniform statewide rate of $10.85 per hour.
While Montana law does not explicitly prohibit local minimum wage ordinances, no cities or counties in Montana have enacted rates exceeding the state minimum wage. The $10.85 statewide rate applies uniformly across all jurisdictions, including:
- Billings – State minimum wage applies
- Missoula – State minimum wage applies
- Great Falls – State minimum wage applies
- Bozeman – State minimum wage applies
- Butte-Silver Bow – State minimum wage applies
- Helena – State minimum wage applies
- Kalispell – State minimum wage applies
Montana employers can rely on consistent application of the $10.85 per hour rate statewide, regardless of where their business operates or where employees perform work. This uniformity simplifies compliance for businesses with multiple locations or employees working across different Montana communities.
Enforcement: The Montana Department of Labor & Industry enforces minimum wage requirements uniformly across all Montana jurisdictions. There are no separate local enforcement agencies or additional local workplace requirements beyond state law.
Who Is Covered and Who Is Exempt
Employees Covered by Montana Minimum Wage
Montana minimum wage law covers virtually all employees working in Montana unless specifically exempted. Unless specifically exempted, covered employees include:
- Private sector workers: Full-time and part-time employees of private businesses operating in Montana
- Salaried non-exempt employees: Employees paid on a salary basis who do not qualify for executive, administrative, or professional exemptions
- Hourly employees: Workers compensated on an hourly basis in all industries
- Temporary and seasonal workers: Workers in temporary or seasonal positions are covered at the same rate
- Minor employees: Workers under age 18 are covered at the full minimum wage with no youth wage provision
- Part-time employees: Employees working any number of hours per week are entitled to minimum wage
- Public sector employees: State and local government employees are covered by Montana’s minimum wage requirements
Exemptions from Minimum Wage Requirements
The following categories of employees may be exempt from Montana minimum wage requirements:
Executive, Administrative, and Professional Employees
Employees performing bona fide executive, administrative, or professional duties may be exempt if they meet both salary and duties tests established under Montana law and federal regulations. These exemptions align with FLSA requirements. To qualify for exemption, employees must:
- Be paid on a salary basis (not hourly)
- Receive salary above minimum thresholds
- Perform primary duties that meet specific criteria for executive, administrative, or professional work
The salary threshold and duties tests for these exemptions are detailed in Montana administrative rules and employers should consult these regulations for specific qualification requirements.
Outside Sales Employees
Employees whose primary duty is making sales away from the employer’s place of business and who are customarily and regularly engaged away from the employer’s business location may be exempt from minimum wage requirements. Outside sales employees must spend the majority of their working time on sales activities conducted outside the employer’s establishment.
Agricultural Workers
Montana provides specific provisions for farm workers under Montana Code § 39-3-404(2). Employers have two options for compensating agricultural employees:
- Keep a record of total hours worked and pay at least the applicable minimum wage multiplied by total hours worked, or
- Pay farm workers on a monthly basis at a minimum monthly wage established by statute ($635 per month as of the last statutory update, though this figure may be subject to review)
Agricultural employers should verify current requirements with the Montana Department of Labor & Industry as these provisions have specific application rules.
Independent Contractors
Properly classified independent contractors are not employees and therefore not covered by minimum wage requirements. However, Montana applies strict tests to determine independent contractor status, and misclassification may result in penalties and back wages. The classification depends on the degree of control the hiring party exercises over the work and the worker’s independence in performing services.
Small Business Employees
As previously described, employees of businesses not covered by FLSA with annual gross sales of $110,000 or less may be paid $4.00 per hour. However, this exception does not apply if the individual employee is engaged in interstate commerce or otherwise covered by federal law.
Common Exemptions
Montana does not provide the following exemptions that exist in some other states:
- No youth wage: Montana does not allow a reduced wage for workers under age 18
- No training wage: Montana does not permit a lower wage during initial employment or training periods
- No student wage: Montana does not authorize reduced wages for full-time students working part-time
- No learner wage: Montana does not have a separate learner or apprentice minimum wage below the standard rate
All covered employees, regardless of age, experience level, or training status, must receive at least the full $10.85 per hour minimum wage.
Employer Obligations and Enforcement
Employer Compliance Obligations
Employers subject to Montana minimum wage law must:
- Pay the applicable minimum wage for all hours worked, including preparation time, opening and closing the business, company travel, and required meetings and training
- Maintain accurate payroll records documenting hours worked and wages paid for at least three years
- Display required labor law posters informing employees of minimum wage rates and worker rights
- Issue compliant wage statements showing gross wages, deductions, and net pay with each payment
- Provide timely payment of wages according to Montana’s wage payment requirements
- Pay wages promptly upon separation – immediately if employee is laid off or discharged, or by the next regular payday if employee quits
Recordkeeping Requirements: Under Montana law, employers must maintain payroll records for three years, including:
- Employee names, addresses, and occupations
- Hours worked each workday and workweek
- Wage rates and total wages paid each pay period
- All deductions from wages
- Date of payment and pay period covered
The Montana Department of Labor & Industry provides detailed guidance on recordkeeping requirements in its Wage and Hour Reference Guide.
Enforcement of Minimum Wage Law
The Montana Department of Labor & Industry, Employment Relations Division enforces minimum wage requirements in Montana. The Compliance and Investigations Bureau specifically handles wage and hour violations. The agency:
- Investigates wage complaints filed by employees
- Conducts compliance reviews and inspections
- Issues orders for payment of unpaid wages
- Assesses penalties for violations
- Provides mediation services to resolve wage disputes
- Conducts administrative hearings when informal resolution fails
Filing a Wage Claim: Employees who believe they have not been paid proper minimum wage may file a complaint with the Montana Department of Labor & Industry through:
- Online: Download the wage claim form from the Department’s website
- Phone: (406) 444-6543
- Mail: Montana Department of Labor & Industry, P.O. Box 8011, Helena, MT 59604
- In-person: 301 South Park Avenue, Floors 4 and 5, Helena, MT 59601
Wage claims must be filed within 180 days of the wage default or delay. The Department may investigate wages for the period up to 2-3 years prior to the last day of employment. Montana law prohibits retaliation against employees who file wage complaints or cooperate with investigations.
Penalties and Remedies
Employers who violate Montana minimum wage law may be subject to:
Back Wages: Employers must pay employees the difference between wages paid and the required minimum wage for all hours worked. The Department can investigate and order payment of back wages for up to three years prior to the complaint date, depending on the circumstances.
Liquidated Damages: Under Montana’s wage payment statutes, employees may be entitled to penalty wages or liquidated damages for willful violations. When the federal Fair Labor Standards Act applies, liquidated damages equal to the amount of unpaid minimum wages may be assessed.
Interest: Unpaid wages may accrue interest from the date wages were due until paid. The interest rate is established by Montana law and administrative rules.
Administrative Penalties: The Department of Labor & Industry may assess civil penalties for violations of minimum wage requirements. Penalties increase for repeat or willful violations.
Court-Ordered Remedies: Employees who prevail in court actions may recover unpaid wages, liquidated damages, prejudgment interest, attorney fees, and costs of litigation. Montana courts have authority to order complete make-whole remedies for wage violations.
Criminal Penalties: Willful violations of Montana’s wage payment laws may constitute criminal offenses under certain circumstances, though criminal prosecution is reserved for the most egregious cases of wage theft.
The Montana Wage Payment Act provides the statutory framework for these enforcement mechanisms and remedies.
Montana Minimum Wage vs Federal Law
The Federal Minimum Wage Floor
The Fair Labor Standards Act (FLSA) establishes a federal minimum wage of $7.25 per hour, which has remained unchanged since July 24, 2009. This federal rate sets a floor for minimum wage requirements nationwide and applies to employers engaged in interstate commerce or with annual gross sales exceeding $500,000. The federal minimum applies across all states and serves as a baseline protection for covered workers.
When State Law Applies
Because Montana’s minimum wage of $10.85 exceeds the federal minimum, most employees working in Montana are entitled to the higher state rate. The federal minimum serves as a fallback only for the very limited category of small employers not covered by state law (those with annual sales under $110,000 and not covered by FLSA).
Under Montana Code § 39-3-409, Montana’s minimum wage must be the greater of either the federal minimum wage or the state rate as adjusted annually for inflation. This statutory language ensures Montana workers receive the higher of the two rates regardless of which law technically covers their employment.
Higher Applicable Rate Rule
The fundamental principle governing minimum wage compliance is that employers must pay whichever rate—federal or state—provides employees the highest hourly wage. This rule ensures workers receive maximum protection under applicable law.
Practical Application:
- Identify whether the employer is covered by federal law (FLSA) or state law, or both
- Determine which minimum wage rates apply to the specific employment situation
- Pay the highest applicable rate
In Montana, this comparison is straightforward: the state minimum wage of $10.85 exceeds the federal minimum of $7.25, so employers covered by either law must pay at least $10.85 per hour. The only exception is the narrow small business exemption for businesses with sales under $110,000 not covered by federal law, which may pay $4.00 per hour (though few employers qualify for this exception in practice).
Employers should note that even if they believe they fall under the small business exception, they must pay federal minimum wage if they engage in any interstate commerce or if individual employees handle goods or communications moving in interstate commerce.
Minimum Wage Posting Requirements
Montana law requires employers to display information about minimum wage rates and employee rights in a conspicuous location accessible to all employees. While Montana does not mandate a specific minimum wage poster as a legal requirement, the Montana Department of Labor & Industry strongly recommends that employers display the Montana Wage & Hour Poster alongside other required labor law postings.
Where to obtain posters:
- Download the 2026 Montana Wage & Hour Poster from the Department’s website
- Download the 2026 Montana Wage & Hour Poster in Spanish
- Available at Montana Job Service Offices statewide
- For required posting information, visit the Montana DLI posting requirements page
Posting locations: The notice should be posted in each workplace location where employees can readily see it, typically near time clocks, in break rooms, or at other prominent locations where employees gather or check work schedules.
Compliance: While the Montana Wage & Hour Poster itself is optional, employers must still comply with other required posting obligations under Montana and federal law. Displaying wage and hour information is considered a best practice for ensuring employees understand their rights and helps prevent wage disputes.
Frequently Asked Questions: Minimum Wage in Montana 2026
What is the minimum wage in Montana in 2026?
The minimum wage in Montana is $10.85 per hour as of January 1, 2026. This rate applies to all covered employees regardless of whether they receive tips. Montana does not allow employers to pay tipped workers a reduced cash wage.
When is the next minimum wage increase in Montana?
The Montana Department of Labor & Industry will announce the 2027 minimum wage rate by September 30, 2026. The new rate takes effect on January 1, 2027. Montana’s minimum wage adjusts annually based on increases in the Consumer Price Index for All Urban Consumers (CPI-U) measured from August to August each year.
Does Montana allow tip credit?
No, Montana does not allow tip credit. All employees, including those who receive tips, must be paid the full minimum wage of $10.85 per hour before tips. Tips received are additional compensation beyond the minimum wage and belong entirely to the employee. Employers cannot use tips to satisfy any portion of minimum wage obligations.
Are there different minimum wages in different cities in Montana?
No, Montana maintains a uniform statewide minimum wage of $10.85 per hour. No cities or counties in Montana have enacted local minimum wage ordinances. The state rate applies consistently across all Montana jurisdictions, from Billings to Missoula to rural counties.
Who is exempt from minimum wage in Montana?
Common exemptions from Montana minimum wage include executive, administrative, and professional employees meeting salary and duties tests, outside sales employees, and certain agricultural workers under specific conditions. Montana does not provide exemptions for youth workers, training periods, or student employees. Independent contractors properly classified are not covered.
What happens if an employer pays below minimum wage in Montana?
Employers who pay below minimum wage face back wage liability for unpaid amounts, potential liquidated damages equal to unpaid wages under federal law, administrative penalties, and possible court-ordered attorney fees. Employees can file complaints with the Montana Department of Labor & Industry within 180 days of wage default. Montana law prohibits retaliation against workers who report violations.
Do small businesses have to pay minimum wage in Montana?
Most small businesses must pay Montana’s $10.85 minimum wage. A limited exception allows businesses not covered by federal law with annual gross sales of $110,000 or less to pay $4.00 per hour. However, this exception is narrow—if individual employees engage in interstate commerce or are otherwise covered by the Fair Labor Standards Act, they must receive the greater of federal or state minimum wage.
Is Montana’s minimum wage higher than the federal minimum?
Yes, Montana’s minimum wage of $10.85 is $3.60 higher than the federal minimum wage of $7.25. Employers in Montana must pay the higher state rate. Montana statute requires the state minimum wage to be the greater of either the federal rate or the Montana rate adjusted annually for inflation.
How often does Montana increase its minimum wage?
Montana adjusts its minimum wage annually on January 1st based on the Consumer Price Index for All Urban Consumers (CPI-U). The Montana Department of Labor & Industry calculates the cost-of-living adjustment each year using CPI data from August to August and announces the new rate by September 30th. If the CPI shows no increase, the minimum wage remains unchanged.
Can employers pay less than minimum wage during training?
No, Montana does not authorize a training wage. Employers must pay at least $10.85 per hour from the first hour of employment, regardless of whether the employee is in a training period, probationary status, or learning new skills. There is no provision for reduced wages during onboarding or skills development.
How to file a minimum wage complaint in Montana
Employees who believe they have not received proper minimum wage compensation may file a wage complaint with the Montana Department of Labor & Industry. Filing methods include:
- Online form: Download the wage claim form and submit by mail or in person
- Phone: (406) 444-6543
- In-person: 301 South Park Avenue, Floors 4 and 5, Helena, MT 59601
- Mail: P.O. Box 8011, Helena, MT 59604
The Department will investigate the complaint and may recover unpaid wages on behalf of the employee. Montana law prohibits employer retaliation against workers who file wage complaints or participate in investigations. Claims must be filed within 180 days of the wage violation.
Do remote workers in Montana get the Montana minimum wage?
Generally, the minimum wage of the jurisdiction where the employee physically performs work applies. Remote workers located in Montana are entitled to Montana’s minimum wage of $10.85 per hour, even if their employer is based in another state. Employers with remote workers should ensure compliance with the wage laws of each state where employees are physically located while working.
Information Verification Log
All information on this page has been compiled from official government sources and verified for accuracy as of the dates below.
| Sources & Verification – Montana Minimum Wage (2026) | ||
|---|---|---|
| Source | Last Verified | Full URL |
| Montana Code Annotated § 39-3-404 | February 10, 2026 | leg.mt.gov – MCA § 39-3-404 |
| Montana Code Annotated § 39-3-409 | February 10, 2026 | leg.mt.gov – MCA § 39-3-409 |
| Montana Department of Labor & Industry | February 10, 2026 | erd.dli.mt.gov – State Minimum Wage |
| Montana Wage & Hour Poster (2026) | February 10, 2026 | Official Minimum Wage Poster (PDF) |
| Montana Wage & Hour FAQs | February 10, 2026 | Wage & Hour FAQ |
| Montana Wage Claim Filing | February 10, 2026 | File a Wage Claim |
| Montana Wage Payment Act | February 10, 2026 | Wage Payment Act |
| 2026 Minimum Wage Determination Letter | February 10, 2026 | Determination Letter (PDF) |
| U.S. Department of Labor – FLSA | February 10, 2026 | dol.gov – FLSA |
| U.S. Department of Labor – Minimum Wage | February 10, 2026 | dol.gov – Minimum Wage |