Overtime Laws in Montana 2026: Pay Rates, Exemptions & Tax Deduction (2026)
⚠️Informational only — not legal or tax advice.
Guide for Montana overtime laws 2026
Last verified: March 5, 2026
Next scheduled review: June 5, 2026
Table of Contents
- Montana Overtime Laws at a Glance (2026)
- Does Montana Have Its Own Overtime Law?
- How Overtime Pay Is Calculated in Montana
- Who Is Exempt from Overtime in Montana?
- Overtime Tax Deduction: “No Tax on Overtime” (2025–2028)
- Can an Employer Require Overtime in Montana?
- Industry-Specific Overtime Rules in Montana
- How to File an Overtime Wage Complaint in Montana
- Penalties for Overtime Violations in Montana
- Montana Overtime Law Updates (2025–2026)
- Frequently Asked Questions
- Sources and Verification
Montana Overtime Laws at a Glance (2026)
| Details | |
|---|---|
| Overtime threshold | 40 hours per workweek |
| Overtime pay rate | 1.5× regular rate of pay |
| Double time | No |
| 7th consecutive day rule | No |
| State minimum wage (2026) | $10.85/hour |
| Exempt salary threshold (2026) | Federal: $684/week ($35,568/yr) |
| Daily overtime | No — weekly calculation only |
| Seasonal student workers (board & room) | Overtime after 48 hours/workweek |
| State enforcement agency | Montana Department of Labor & Industry, Employment Standards Division |
| Federal enforcement | U.S. DOL Wage and Hour Division |
| Overtime tax deduction (federal) | Up to $12,500/yr (2025–2028) — FLSA-covered workers |
| State-level DLI filing deadline | 180 days from date of violation |
| FLSA statute of limitations | 2 years (3 if willful) |
Governing law: Montana Code Annotated § 39-3-405; Fair Labor Standards Act, 29 U.S.C. § 207
Last verified: March 5, 2026
Does Montana Have Its Own Overtime Law?
Montana has its own overtime law under Montana Code Annotated § 39-3-405, part of the Montana Minimum Wage Law of 1971. The statute establishes that employers may not employ any nonexempt employee for more than 40 hours in a workweek without paying overtime at a rate of not less than 1.5 times the employee’s regular hourly rate.
When Montana law and the federal Fair Labor Standards Act (FLSA) differ, the standard that is more favorable to the employee applies.
Key features of Montana’s overtime law:
Montana’s state overtime statute covers employees regardless of whether their employer is subject to the FLSA. Small employers not covered by the FLSA — specifically businesses with gross annual sales of $110,000 or less — are still subject to Montana’s state overtime requirements for most employees. This provides broader coverage than federal law alone in some situations.
Montana’s overtime law also includes a specific provision for students employed at seasonal amusement or recreational areas who are furnished board, lodging, or other facilities by the employer. These employees are entitled to overtime only after 48 hours in a workweek, rather than 40.
Notable distinction: Montana law explicitly does not extend overtime protections to farm workers (MCA § 39-3-405(2)). Under the FLSA, agricultural workers are also exempt from overtime. Both state and federal exemptions align on this point.
The statute makes clear that firefighters and law enforcement officers employed by the state must be compensated for overtime consistent with the FLSA and its implementing regulations (MCA § 39-3-405(4)).
State statute: Montana Code Annotated § 39-3-405 — https://leg.mt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0050/0390-0030-0040-0050.html
State exemptions: Montana Code Annotated § 39-3-406 — https://archive.legmt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0060/0390-0030-0040-0060.html
Federal statute: Fair Labor Standards Act, 29 U.S.C. § 207 — https://www.dol.gov/agencies/whd/overtime
How Overtime Pay Is Calculated in Montana
What Is a “Workweek”?
Under both the FLSA and Montana law, a workweek is a fixed, regularly recurring period of 168 consecutive hours (seven consecutive 24-hour periods). A workweek does not have to start on Monday or align with a calendar week — the employer may designate any day and time as the start of the workweek.
Each workweek stands alone. An employer cannot average hours across two or more workweeks to avoid overtime. If an employee works 50 hours in one week and 30 the next, overtime is owed for the first week regardless of the second.
Source: Montana Code Annotated § 39-3-405; 29 C.F.R. § 778.104–778.105
Pay Rates
Under Montana law (MCA § 39-3-405) and the FLSA, nonexempt employees in Montana earn overtime at the following rate:
Time-and-a-half (1.5× regular rate):
- All hours worked over 40 in a workweek
Montana does not impose daily overtime triggers, double-time requirements, or 7th-consecutive-day rules. Overtime is calculated on a weekly basis only.
Special rule — Seasonal student workers with board and room:
Students employed at seasonal amusement or recreational areas who receive board, lodging, or similar facilities from the employer are only entitled to overtime after 48 hours in a workweek, not 40. All hours over 48 must be compensated at 1.5× their regular rate.
Source: Montana Code Annotated § 39-3-405(3)
What Counts as the “Regular Rate of Pay”
The regular rate is not always the same as the hourly wage. Under the FLSA (29 C.F.R. § 778.108), the regular rate includes:
- Base hourly rate or salary equivalent
- Non-discretionary bonuses and incentive pay
- Shift differentials
- Commissions
- Piece-rate earnings
The regular rate does not include:
- Discretionary bonuses (e.g., holiday gifts)
- Employer contributions to benefit plans
- Vacation, holiday, or sick pay when no work is performed
Montana’s Wage and Hour Reference Guide confirms that the regular rate is determined by dividing total wages for employment in any workweek by the total number of hours actually worked. All forms of compensation — including commissions, bonuses, and tips — count as wages under Montana law (MCA § 39-3-201).
Source: Montana Code Annotated § 39-3-201; 29 C.F.R. § 778.108–778.122; https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-laws-guide
Calculation Example
Example — Weekly overtime in Montana:
An employee earns $10.85/hour (Montana minimum wage, 2026) and works 48 hours in one workweek:
- Regular pay: 40 hours × $10.85 = $434.00
- Overtime pay: 8 hours × ($10.85 × 1.5) = 8 × $16.28 = $130.24
- Total weekly gross pay: $564.24
Example — Seasonal student worker (board & room) in Montana:
A student works at a seasonal recreational area, receives room and board from the employer, and works 52 hours in one week:
- Regular pay: 48 hours × $10.85 = $520.80
- Overtime pay: 4 hours × ($10.85 × 1.5) = 4 × $16.28 = $65.12
- Total weekly gross pay: $585.92
For the current Montana minimum wage used in these calculations, see the Montana Minimum Wage page.
Source: Montana Code Annotated § 39-3-405; https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/state-minimum-wage
Who Is Exempt from Overtime in Montana?
Not all employees in Montana are entitled to overtime pay. Exemptions arise under both Montana law and the federal FLSA.
Federal FLSA Exemption Requirements
To be exempt from overtime under the FLSA, an employee must meet all three of the following criteria:
1. Salary basis test: Paid a predetermined, fixed salary each pay period (not hourly)
2. Salary level test: Earn at least $684 per week ($35,568 per year)
3. Duties test: Perform specific job duties in one of these categories:
| Exemption | Key duty requirement |
|---|---|
| Executive | Manages enterprise or department; directs 2+ employees; authority to hire/fire |
| Administrative | Office/non-manual work related to management or business operations; exercises independent judgment |
| Professional | Work requiring advanced knowledge in a field of science or learning acquired through prolonged specialized study |
| Computer employee | Systems analysis, programming, software engineering — $684/week salary OR $27.63/hour |
| Outside sales | Primary duty is making sales away from employer's place of business |
Source: 29 C.F.R. Part 541
What Happened to the 2024 DOL Salary Threshold Increase?
In April 2024, the U.S. Department of Labor issued a final rule that would have raised the exempt salary threshold to $1,128 per week ($58,656/year) effective January 1, 2025.
On November 15, 2024, the U.S. District Court for the Eastern District of Texas vacated that rule nationwide in Texas v. U.S. Department of Labor (No. 4:24-cv-00499).
The salary threshold remains $684/week ($35,568/year) as of 2026.
Montana does not set an independent state exempt salary threshold above the federal level. The federal FLSA threshold of $684/week applies to covered employers in Montana.
Montana-Specific Exemptions
Montana Code Annotated § 39-3-406 lists employees exempt from both minimum wage and overtime, or from overtime only. Key exemptions include:
Exempt from both minimum wage and overtime (MCA § 39-3-406):
- Students in accredited distributive education programs (prior approval required)
- Persons employed in private homes for menial chores (babysitting, lawn care)
- Persons employed to care for children of the head of a household
- Immediate family members or financial dependents of the employer
- Unpaid or partially reimbursed volunteers for nonprofit organizations
- Persons with disabilities in work incidental to training or evaluation programs (prior approval required)
- Apprentices or learners for the first 30 days of employment (prior approval required)
- Farm worker learners under age 18 (for up to 180 days of initial employment)
- Retired or semi-retired persons in part-time incidental work on a farm or ranch
- Bona fide executive, administrative, or professional employees (as defined by DLI regulations)
- Computer employees earning at least $27.63/hour (MCA § 39-3-406(1)(j); 29 C.F.R. § 541.400–541.402)
- Outside sales employees (29 C.F.R. § 541.500)
- Employees of the United States government
- Resident managers at lodging establishments or assisted living facilities who live on premises
- Direct sellers as defined in 26 U.S.C. § 3508
- Foster parents caring for up to six children in their own residence
- Employees providing companionship services for elderly or infirm individuals, when employed directly by a family member or legal guardian
- Employees of seasonal nonprofit camps or religious/educational conference centers
Exempt from overtime only (MCA § 39-3-406):
- Farm workers (no state overtime protections — MCA § 39-3-405(2))
- Employees subject to motor carrier hours of service regulations
- Certain transportation and airline employees
- Air carrier employees whose overtime hours were voluntarily traded among employees
- State or local government employees working occasional or sporadic extra duty outside their regular occupation
Source: Montana Code Annotated §§ 39-3-405, 39-3-406 — https://archive.legmt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0060/0390-0030-0040-0060.html; Montana DLI Wage and Hour Reference Guide — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-laws-guide
Computer Employee Exemption — Montana-Specific Note
Montana enacted its computer employee overtime exemption effective October 1, 2013 (MCA § 39-3-406(1)(j)). Prior to that date, Montana did not recognize this exemption — meaning pre-2013 claims for computer employees cannot rely on it. The exemption applies to computer systems analysts, programmers, software engineers, network administrators, and similarly skilled computer employees earning at least $27.63 per hour. Job title alone does not determine applicability; actual job duties govern.
Source: Montana DLI Wage and Hour Reference Guide — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-laws-guide
Overtime Tax Deduction: "No Tax on Overtime" (2025–2028)
The One Big Beautiful Bill Act (Public Law 119-21), signed on July 4, 2025, created a new federal income tax deduction for qualified overtime compensation under Internal Revenue Code § 225. This deduction is available for tax years 2025 through 2028.
Who Is Eligible
- Nonexempt employees covered by the Fair Labor Standards Act (29 U.S.C. § 207)
- Must have a Social Security number valid for employment
- Cannot use the Married Filing Separately filing status
Who is NOT eligible:
- Exempt (salaried) employees who do not receive FLSA overtime
- Independent contractors (1099 workers) who are not FLSA-covered
- Employees receiving overtime only under Montana state law or employer policy, if that overtime is not also required by the FLSA
What Is Deductible
The deduction covers the premium portion of overtime pay — specifically the amount that exceeds the regular rate of pay.
| Overtime type | What is deductible | Example ($20/hr regular rate) |
|---|---|---|
| Time-and-a-half (1.5×) | The "half" — 1/3 of total OT pay | $10/hr per OT hour ($30 − $20) |
IRS shortcut for 2025: If you only know your total overtime pay and were paid time-and-a-half, divide the total overtime amount by 3. (Source: IRS Notice 2025-69)
| Deduction Limits | ||
|---|---|---|
| Filing status | Maximum annual deduction | Phase-out begins |
| Single | $12,500 | $150,000 MAGI |
| Married filing jointly | $25,000 | $300,000 MAGI |
| W-2 Reporting | |
|---|---|
| Tax year | Employer reporting requirement |
| 2025 | NOT required to separately report (transition year — IRS Notice 2025-62). May voluntarily report in W-2 Box 14 as "QUALI OT" or provide a separate statement |
| 2026 and later | REQUIRED to separately report qualified overtime compensation. IRS has indicated Box 12, Code TT for this purpose (draft form; subject to change before finalization) |
If an employer did not separately report overtime for 2025, the IRS allows employees to use “any reasonable method” to calculate the deductible amount, including one-third of total overtime pay (for time-and-a-half workers), payroll records or pay stubs, or employer statements.
What This Deduction Does NOT Do
- Does not exempt overtime from Social Security (6.2%) or Medicare (1.45%) taxes
- Does not apply to state income taxes unless the state separately conforms
- Does not change how much overtime pay an employee receives — it reduces taxable income when filing
- Does not apply to overtime paid solely under Montana state law or employer policy that exceeds FLSA requirements
Source: IRS FAQs on Qualified Overtime Compensation Deduction; IRS Notice 2025-69; IRS Notice 2025-62; IRC § 225; P.L. 119-21, § 70202; Schedule 1-A (Form 1040)
Official IRS page: https://www.irs.gov/newsroom/questions-and-answers-about-the-new-deduction-for-qualified-overtime-compensation
Montana Income Tax and the Federal Overtime Deduction
Montana imposes a state individual income tax. Overtime pay in Montana is subject to Montana state income tax at normal rates.
However, Montana has rolling IRC conformity under MCA § 15-30-2101 and § 15-31-113. Montana’s individual income tax starts from federal taxable income and incorporates IRC amendments as enacted — without requiring separate legislative action. Because Montana uses federal taxable income as its starting point and conforms to the IRC on a rolling basis, the IRC § 225 overtime deduction enacted by the OBBBA flows through automatically to Montana state taxable income for tax years 2025–2028.
This means Montana employees who qualify for the federal overtime deduction may also benefit from a reduction in their Montana state taxable income on the same basis.
Important caveat: Taxpayers should verify the current treatment of the IRC § 225 deduction with the Montana Department of Revenue, as legislative or administrative guidance specific to OBBBA conformity may be issued during the 2026 Montana legislative session. No Montana-specific decoupling legislation has been identified as of the date of this page.
Source: Montana Code Annotated § 15-30-2101 — https://archive.legmt.gov/bills/mca/title_0150/chapter_0300/part_0210/section_0100/0150-0300-0210-0100.html; Montana Department of Revenue — https://revenue.mt.gov; Montana Legislative Revenue Office — https://archive.legmt.gov/content/Committees/Interim/2023-2024/Revenue/Meetings/January-2024/1.4-SB399-memo.pdf
Cross-reference: For Montana individual income tax details, see the Montana Income Tax page.
Can an Employer Require Overtime in Montana?
Under the FLSA, there is no federal limit on the number of hours an employer can require an adult employee (age 16 and older) to work in a workweek, provided the employee is properly compensated for all overtime hours.
Similarly, Montana law does not impose a cap on the total hours an employer may require an employee to work. Montana’s Wage and Hour FAQs state that “the employer can work an employee as long as they feel it is necessary for the job that they are doing,” subject to overtime pay requirements for hours over the applicable threshold.
Montana is not an at-will employment state in the traditional sense. Unlike most states, Montana’s Wrongful Discharge From Employment Act (WDEA), MCA § 39-2-901 et seq., provides employees who have completed their probationary period with protection against discharge without good cause. This does not prevent employers from requiring overtime, but it does mean that terminating an employee solely for refusing overtime could be subject to greater scrutiny than in at-will states, depending on the circumstances, employment contract terms, and whether a collective bargaining agreement applies.
Notwithstanding the WDEA, refusing to work required overtime is generally a valid basis for employer action under most employment arrangements. Employees should review any applicable employment contracts or collective bargaining agreements.
Montana does not have additional state-level restrictions on mandatory overtime beyond the FLSA for most industries. Certain industries, such as healthcare, may have relevant federal or accreditation-based guidelines, but Montana has not enacted a broad statewide mandatory overtime restriction statute.
Protections That Always Apply
Regardless of mandatory overtime policies, the following protections apply in Montana:
- All overtime hours must be compensated at the applicable overtime rate (MCA § 39-3-405; 29 U.S.C. § 207)
- Employers cannot retaliate against employees who file wage complaints (29 U.S.C. § 215(a)(3); MCA § 39-3-216)
- Disability accommodation requests under the ADA may limit overtime requirements
- Child labor laws restrict hours for employees under 18
Source: 29 U.S.C. § 207; Montana Code Annotated § 39-3-405; Montana DLI FAQ — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-faq; Montana Code Annotated § 39-2-901 — https://leg.mt.gov/bills/mca/title_0390/chapter_0020/part_0090/sections_index.html
Industry-Specific Overtime Rules in Montana
Agriculture
Under both the FLSA and Montana law, agricultural workers are exempt from overtime. Montana Code Annotated § 39-3-405(2) states explicitly that overtime provisions do not apply to farm workers. Agricultural employees covered under Montana law may be paid at least the applicable minimum wage per hour or, alternatively, on a monthly basis of at least $635.
If an agricultural operation employs workers at sufficient scale to be covered by the FLSA (more than 500 man-days of agricultural labor in any calendar quarter of the preceding year), the federal agricultural exemption also applies, and overtime is not required.
Source: Montana Code Annotated § 39-3-405(2); https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-laws-guide
Healthcare (8-and-80 System)
Under 29 U.S.C. § 207(j), hospitals and residential care facilities may adopt a 14-day alternative work period by agreement with employees. Under this arrangement, overtime is due after 8 hours per day or 80 hours in the 14-day period, whichever calculation results in greater overtime pay for the employee.
Montana does not have a separate state statute modifying or expanding this federal healthcare overtime option.
Source: 29 U.S.C. § 207(j); 29 C.F.R. § 778.601
Retail and Commission Employees
Under 29 U.S.C. § 207(i), employees of retail or service establishments who are paid more than half their earnings in commissions may be exempt from overtime if their regular rate of pay exceeds 1.5 times the applicable minimum wage. Montana follows this federal exemption for covered employers.
Source: 29 U.S.C. § 207(i)
Public Sector / Government Employees
Under 29 U.S.C. § 207(o), public employers (state and local government) may offer compensatory time off instead of overtime pay, provided a prior agreement exists, comp time accrues at 1.5 hours per overtime hour worked, and the employee does not exceed the applicable cap.
Montana Code Annotated § 39-3-406(1)(x) also exempts state or local government employees who, at their own option, work occasional or sporadic shifts in a capacity other than their regular occupation — only those extra-duty hours are excluded from the overtime calculation.
Source: 29 U.S.C. § 207(o); Montana Code Annotated § 39-3-406(1)(x)
Compensatory Time (“Comp Time”) Rules
Under the FLSA, private-sector employers cannot offer comp time in lieu of overtime pay. An employee who works overtime hours must be compensated at 1.5× their regular rate in wages, not in time off.
Public-sector employers (state and local government) in Montana may offer compensatory time off instead of overtime pay under 29 U.S.C. § 207(o), provided:
- The comp time accrues at 1.5 hours for each overtime hour worked
- A prior agreement exists between the employer and employee (or union)
- The cap is 240 hours of accrued comp time (or 480 hours for public safety, emergency response, and seasonal employees)
- Employees must be permitted to use accrued comp time within a reasonable period
Montana follows federal rules for comp time and does not have a separate state comp time statute for private employers.
Source: 29 U.S.C. § 207(o)
Transportation (Motor Carrier Exemption)
Employees whose duties affect the safe operation of motor vehicles in interstate commerce may be exempt from FLSA overtime under the Motor Carrier Act exemption (49 U.S.C. § 31502). Montana Code Annotated § 39-3-406(1)(a) mirrors this exemption for state law purposes.
Source: 49 U.S.C. § 31502; Montana Code Annotated § 39-3-406(1)(a)
How to File an Overtime Wage Complaint in Montana
Employees in Montana who believe they have not received proper overtime pay have three options.
Option 1: Montana Department of Labor & Industry — Wage and Hour Unit
| Details | |
|---|---|
| Agency | Montana Department of Labor & Industry, Employment Standards Division, Compliance and Investigations Bureau |
| Wage claim form & instructions | https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/filing-a-wage-claim |
| Phone | (406) 444-6543 |
| DLIERDWage@mt.gov | |
| Mailing address | P.O. Box 8011, Helena, MT 59604 |
| Deadline | 180 days from the date of the wage violation (MCA § 39-3-207) |
| Investigation reach | DLI may investigate wages 2 to 3 years prior to the last day of employment |
Important: Montana’s administrative wage claim deadline is 180 days from the date of default or delay — significantly shorter than the FLSA’s 2-year window. Employees who miss the DLI deadline may still pursue a private lawsuit under the FLSA, but the state administrative remedy will be unavailable.
Option 2: U.S. Department of Labor — Wage and Hour Division
| Details | |
|---|---|
| Online | https://www.dol.gov/agencies/whd/contact/complaints |
| Phone | 1-866-487-9243 (toll-free) |
| Deadline | 2 years from violation (3 years if willful) |
Option 3: Private Lawsuit
Employees may file a lawsuit against their employer in state or federal court under 29 U.S.C. § 216(b). Remedies may include:
- Back wages owed
- Liquidated damages (an additional amount equal to the unpaid wages)
- Reasonable attorney’s fees and court costs
Under Montana’s Wage Payment Act, MCA § 39-3-206, additional penalties may be assessed against employers who fail to pay wages as required, including a penalty of up to 110% of the unpaid wages for willful violations. However, MCA § 39-3-408 clarifies that FLSA liquidated damages, rather than Montana penalty provisions, apply to FLSA-covered employers for minimum wage and overtime violations.
Retaliation Protection
Under the FLSA (29 U.S.C. § 215(a)(3)) and Montana law (MCA § 39-3-216), employers cannot retaliate against employees for:
- Filing an overtime wage complaint
- Participating in an investigation
- Testifying in proceedings related to overtime violations
Source: Montana Code Annotated §§ 39-3-207, 39-3-206, 39-3-408, 39-3-216 — https://leg.mt.gov; Montana DLI Filing a Wage Claim — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/filing-a-wage-claim; 29 U.S.C. § 216(b); 29 U.S.C. § 215(a)(3)
Penalties for Overtime Violations in Montana
| Federal FLSA Penalties | |
|---|---|
| Penalty type | Amount |
| Back wages | Full amount of unpaid overtime owed |
| Liquidated damages | Equal to unpaid wages (effectively doubles recovery) |
| Civil monetary penalty | Up to $2,451 per violation (willful/repeated — adjusted annually) |
| Criminal prosecution | Willful: fines up to $10,000; second offense: up to 6 months imprisonment |
Source: 29 U.S.C. § 216
Montana State Penalties
Under Montana Code Annotated § 39-3-206, employers who fail to pay wages as required may be assessed a penalty. For overtime violations where the FLSA applies, MCA § 39-3-408 specifies that FLSA liquidated damages govern rather than the state penalty provision.
For wage violations not covered by the FLSA (e.g., workers covered only by Montana state law), Montana’s penalty provisions may result in an award of up to 110% of the unpaid wages, depending on the circumstances and whether the violation was willful. Employees may also recover costs incurred in collecting wages.
Montana does not provide treble damages for overtime violations.
Source: Montana Code Annotated §§ 39-3-206, 39-3-408 — https://leg.mt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0080/0390-0030-0040-0080.html
Montana Overtime Law Updates (2025–2026)
Federal Changes Affecting Montana
- July 4, 2025: One Big Beautiful Bill Act (P.L. 119-21) signed — created federal overtime tax deduction for tax years 2025–2028 under IRC § 225. Montana’s rolling IRC conformity means the deduction flows through to Montana taxable income.
- November 15, 2024: DOL salary threshold rule vacated by federal court — exempt threshold remains $684/week ($35,568/year)
- January 1, 2026: Montana minimum wage increased from $10.55 to $10.85/hour, raising the minimum overtime rate to $16.28/hour
Montana Changes
- January 1, 2026: Minimum wage adjustment to $10.85/hour based on CPI increase (announced by Montana DLI by September 30, 2025 per statutory formula). The 2026 Montana Wage & Hour Poster updated accordingly.
- No changes to Montana’s overtime statute (MCA § 39-3-405) during the 2025 legislative session.
Pending Legislation
No Montana-specific overtime exemption legislation or mandatory overtime restriction bills were identified as active during the 2025–2026 legislative cycle. Montana’s 2025 legislative session addressed other employment matters (including pay transparency proposals that were tabled in committee) but did not advance overtime-specific changes.
Last reviewed: March 5, 2026
Next scheduled review: June 5, 2026
Source: Montana DLI — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/state-minimum-wage; Montana 2026 Minimum Wage Determination Letter — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/state-minimum-wage
Frequently Asked Questions About Overtime in Montana
Does Montana have its own overtime law?
Yes. Montana has its own overtime law under Montana Code Annotated § 39-3-405, enacted as part of the Montana Minimum Wage Law of 1971. Under this law, nonexempt employees must receive overtime pay at 1.5 times their regular rate for all hours worked over 40 in a workweek. Montana’s law covers employees of small employers who may not otherwise be subject to the federal FLSA.
What is the overtime rate in Montana in 2026?
The overtime rate in Montana is 1.5 times the employee’s regular rate of pay for hours over 40 in a workweek. Based on Montana’s 2026 minimum wage of $10.85/hour, the minimum overtime rate is $16.28/hour. Montana does not require double-time pay at any threshold.
Does Montana require daily overtime?
No. Overtime in Montana is calculated on a weekly basis only. Working more than 8 hours in a single day does not trigger overtime under either Montana law or the FLSA unless total hours worked in the workweek exceed 40.
Is mandatory overtime legal in Montana?
Under Montana law, employers may generally require employees to work overtime, provided overtime is properly compensated. Montana does not have a general state law prohibiting mandatory overtime for most industries. However, Montana’s Wrongful Discharge From Employment Act (MCA § 39-2-901) may affect how employers can act against employees who refuse overtime after completing a probationary period, depending on the terms of employment.
Am I exempt from overtime in Montana?
Exemption depends on both salary level and job duties. Under the FLSA, employees must earn at least $684/week on a salary basis and perform executive, administrative, or professional duties. Montana does not set a higher state salary threshold. Additionally, Montana law lists specific occupations exempt from state overtime requirements, including farm workers, certain computer employees earning at least $27.63/hour, and others listed in MCA § 39-3-406.
Can salaried employees get overtime in Montana?
Yes. Being paid a salary does not automatically exempt an employee from overtime. Salaried employees who earn less than $684/week or who do not satisfy the duties tests under 29 C.F.R. Part 541 are nonexempt and entitled to overtime pay.
Is overtime taxed in Montana?
Overtime pay is subject to both federal and Montana state income taxes. However, under the One Big Beautiful Bill Act (IRC § 225, 2025–2028), FLSA-covered nonexempt employees may deduct up to $12,500 ($25,000 joint) of the premium portion of overtime from federal taxable income. Because Montana conforms to the IRC on a rolling basis (MCA § 15-30-2101), this deduction also reduces Montana state taxable income for qualifying workers. Taxpayers should verify current guidance with the Montana Department of Revenue.
How do I calculate the overtime tax deduction?
For time-and-a-half pay, the deductible amount is one-third of total overtime pay. For example, if you earned $9,000 in total overtime at time-and-a-half, the qualified overtime compensation is $3,000. The IRS confirms this method in Notice 2025-69. The deduction is claimed on Schedule 1-A of Form 1040.
How do I file an overtime complaint in Montana?
File a wage claim with the Montana Department of Labor & Industry, Employment Standards Division, Compliance and Investigations Bureau at https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/filing-a-wage-claim or by calling (406) 444-6543. The DLI administrative deadline is 180 days from the date of the violation. Employees may also file with the U.S. DOL Wage and Hour Division (1-866-487-9243), which has a 2-year FLSA deadline (3 years for willful violations).
Can my employer fire me for refusing overtime in Montana?
Montana’s Wrongful Discharge From Employment Act (MCA § 39-2-901) provides that employees who have completed their probationary period generally cannot be fired without good cause. Whether refusing overtime constitutes good cause for discharge depends on the specific employment situation, applicable policies, and any contract terms. Employers cannot retaliate against employees who file wage complaints under 29 U.S.C. § 215(a)(3) or MCA § 39-3-216.
Can my employer give comp time instead of overtime pay in Montana?
For private-sector employees, no. The FLSA prohibits private employers from substituting compensatory time off for overtime pay. Public employers in Montana may offer comp time at 1.5 hours per overtime hour under 29 U.S.C. § 207(o), subject to applicable caps (240 hours generally; 480 hours for public safety and emergency employees).
Does working on weekends or holidays count as overtime in Montana?
No. Under both Montana law and the FLSA, working on weekends or holidays does not automatically constitute overtime. Overtime is determined by total hours worked in the workweek, regardless of which days those hours occurred.
What happens if my employer doesn’t pay overtime in Montana?
Employees may file a wage claim with the Montana DLI (within 180 days) or pursue a private lawsuit. Under the FLSA, employees may recover unpaid wages, liquidated damages equal to the unpaid amount, and attorney’s fees (29 U.S.C. § 216(b)). For violations covered only by Montana state law, penalties under MCA § 39-3-206 may apply.
What is the statute of limitations for overtime claims in Montana?
There are two applicable deadlines: (1) Administrative claims with the Montana DLI must be filed within 180 days of the violation (MCA § 39-3-207). DLI may investigate wages covering 2 to 3 years prior. (2) Private lawsuits under the FLSA must be filed within 2 years (or 3 years for willful violations). Employees should act promptly and consult both deadlines.
Do farm workers in Montana get overtime?
No. Montana Code Annotated § 39-3-405(2) explicitly exempts farm workers from the state overtime law. Agricultural workers are similarly exempt under the federal FLSA. Montana farm workers are entitled to the state minimum wage ($10.85/hour in 2026) or, alternatively, a monthly salary of at least $635.
What is the 48-hour overtime rule for seasonal workers in Montana?
Students employed at seasonal amusement or recreational areas who are furnished board, lodging, or other facilities by the employer are only entitled to overtime after 48 hours in a workweek, rather than the standard 40-hour threshold. All hours over 48 must be compensated at 1.5× their regular rate (MCA § 39-3-405(3)).
Sources and Verification
Primary Sources
- Montana Code Annotated § 39-3-405 (Overtime Compensation) — https://leg.mt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0050/0390-0030-0040-0050.html
- Montana Code Annotated § 39-3-406 (Exclusions/Exemptions) — https://archive.legmt.gov/bills/mca/title_0390/chapter_0030/part_0040/section_0060/0390-0030-0040-0060.html
- Montana Code Annotated § 39-3-207 (Wage Claim Filing Period) — https://leg.mt.gov
- Montana Code Annotated § 39-3-206, § 39-3-408 (Penalties) — https://leg.mt.gov
- Montana Code Annotated § 15-30-2101 (Individual Income Tax IRC Conformity) — https://archive.legmt.gov/bills/mca/title_0150/chapter_0300/part_0210/section_0100/0150-0300-0210-0100.html
- Montana Code Annotated § 39-2-901 et seq. (Wrongful Discharge From Employment Act) — https://leg.mt.gov/bills/mca/title_0390/chapter_0020/part_0090/sections_index.html
- Montana Department of Labor & Industry, Employment Standards Division — https://erd.dli.mt.gov
- Montana DLI Wage and Hour Laws Reference Guide — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-laws-guide
- Montana DLI Minimum Wage (2026 rate $10.85) — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/state-minimum-wage
- Montana DLI Filing a Wage Claim — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/filing-a-wage-claim
- Montana DLI Wage and Hour FAQs — https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-faq
- U.S. Department of Labor, Wage and Hour Division — https://www.dol.gov/agencies/whd/overtime
- Fair Labor Standards Act — 29 U.S.C. §§ 201–219
- 29 C.F.R. Part 541 (Overtime Exemptions)
- 29 C.F.R. §§ 778.104–778.122 (Workweek; Regular Rate)
- Internal Revenue Service — Overtime Tax Deduction FAQs — https://www.irs.gov/newsroom/questions-and-answers-about-the-new-deduction-for-qualified-overtime-compensation
- IRS Notice 2025-69 (Individual Calculation Guidance for Overtime Deduction)
- IRS Notice 2025-62 (Employer Reporting Transition Relief for 2025)
- Schedule 1-A, Form 1040 (Claiming the Overtime Deduction)
- Montana Department of Revenue — https://revenue.mt.gov