Montana Overtime Laws: An Overview

Overtime refers to the additional compensation that employees receive when they work above the normal hours prescribed by their employer. In Montana, employers are required by law to pay their employees overtime pay when they exceed a certain number of hours in a workweek.

The Montana overtime laws are designed to protect workers by ensuring that they receive fair compensation for the time they put in at their jobs. This article will provide an overview of Montana’s overtime laws, including who is eligible for overtime pay, how overtime pay is calculated, and what exceptions there are to Montana’s overtime rules.

Who Is Eligible for Overtime Pay in Montana?

Under Montana law, most employees are entitled to overtime pay when they work more than 40 hours in a workweek. However, there are exceptions. Some employees are exempt from overtime pay requirements and are not entitled to receive it.

Exempt employees include those who:

– Are executive, administrative or professional employees (EAP)
– Are salaried employees earning at least $35,568 per year
– Are outside salespeople
– Are workers in certain industries, such as agriculture, movie theaters, and newspapers

EAP employees are individuals who perform work that is of an executive, administrative or professional nature. The Department of Labor uses a set of criteria to determine whether an employee falls within this category. For instance, an employee must have a salary that is equivalent to at least twice the state minimum wage before they can be classified as an EAP employee.

Salaried employees are typically paid a fixed amount for a set period of time, such as a week or a month. If an employer pays a salaried employee for more than 40 hours in a workweek, they are not required to provide overtime compensation.

How Is Overtime Pay Calculated in Montana?

In Montana, eligible employees are entitled to receive one and one-half times their regular rate of pay for all overtime hours worked in a workweek. For example, if an employee’s regular rate of pay is $20 per hour, they would be entitled to receive $30 per hour for any overtime hours worked.

Calculating overtime pay can be complicated, especially if an employee has a variable rate of pay or earns commissions or bonuses. Employers are required to use the following method for calculating overtime pay, as per Montana law.

Hourly Employees

To calculate overtime pay for hourly employees, employers should take the employee’s regular hourly rate and multiply it by 1.5. For instance, if an employee earns $15 per hour, their overtime rate would be $22.50 per hour.

Salaried Employees

To calculate overtime pay for salaried employees, employers should divide the employee’s weekly salary by the total hours worked in a week. They can then use this figure to calculate the employee’s regular hourly rate of pay. From there, they can calculate the overtime rate as per the method used for hourly employees.

Commissioned or Piecework Employees

For employees who earn commissions or work on a piecework basis, their overtime rate is calculated based on a piecework or commission rate. Employers should divide the employee’s total earnings for the week by the total number of hours worked, to arrive at the employee’s regular rate of pay. They can then apply the overtime rate as per Montana law.

Exceptions to Overtime Rules

While most employees are entitled to receive overtime pay for any hours worked over 40 in a workweek, there are some exceptions. Most notably, Montana law exempts outside salespeople and employees in certain industries from overtime pay requirements.

Additionally, some employees who are classified as EAP employees are exempt from overtime pay requirements. However, the criteria for determining this classification are strict, and employers must be careful not to misclassify employees as EAP in order to avoid paying overtime.

Implications for Employers

Employers must be careful to comply with Montana’s overtime laws. Failure to pay overtime can result in significant penalties, including additional pay owed to employees, legal fees, and fines imposed by regulatory agencies.

Employers should develop clear policies around overtime, including specifying who is eligible for overtime and how it will be calculated. Employers should also provide training to their managers and supervisors to ensure that they understand overtime requirements and don’t inadvertently misclassify employees or violate Montana’s overtime laws.

Conclusion

Montana’s overtime laws are designed to protect workers by ensuring that they receive fair compensation for the time they put in at their jobs. Employers must be careful to comply with these laws to avoid penalties and fines. Montana law specifies who is eligible for overtime pay and how it should be calculated, but employers must be careful to thoroughly understand these rules and exceptions to develop policies that ensure compliance.

Guide to Montana Overtime Laws

What are Montana Overtime Laws?

In the state of Montana, the majority of workers who receive an hourly wage and work over 40 hours in a 7-day work week must be provided with overtime compensation. When providing overtime compensation, an employer must pay at least 1.5 times the workers’ regularly hourly wage. Montana overtime laws are based on the number of hours worked in a traditional seven-day work week; the number of hours worked in a single day does not factor into the overtime calculation. 

Additionally, MT overtime laws declare that employers may force their employees to work any number of hours in a given 40 hour week; limitations are placed on workers under the age of 18. But of course remember, that any number of hours worked beyond 40, must be compensated at 1.5 times the worker’s normal hourly rate. 

Montana overtime laws make it mandatory that an employer pay an employee—described above—1.5 times their hourly wage. This applies to all hourly earners, with the exception of the following list:

Workers who are not protected by MT Overtime Laws:

• Montana Overtime Law does not protect workers employed on ranches or farms

• Seasonal employees at agricultural centers or fairs

• Montana Overtime Law does not provide protection for newspaper carriers or vendors

• Casual labor in or about private dwellings

• Fire Prevention and fire protection workers are not protected under Montana overtime laws

• Any position that requires the worker to reside or sleep at their office

• Seaman are not protected under MT overtime laws

• Vessel Operating Crews

• Inmates, patients or residents of any county, municipal or state correctional rehab institution or detention Center

• Youth Camps with Child Care Centers are not protected under Montana overtime laws

• Montana overtime law does not offer protection to Administrative, Executive, Computer Professional and Outside Sales employees

• Volunteers are not protected under Montana overtime laws

• Elected or appointive offices

MT Overtime Laws Regarding Breaks:

Montana overtime laws permit workers to request time off at later dates instead of being paid overtime wages in said periods. This is referred to as “exchange time” or “comp time.” When the employee takes his/her time off, payment must be paid at least one-half their typical wage rate. The exchange hours; however, may be paid at the regular rate. It must be noted; however, that federal law does not permit these types of agreements except for public workers and their employees.

To be exempt—according to MT Overtime Laws—as an executive employee, an individual must:

• Regularly direct the work of multiple (two or more) full-time employees

• Have management as his/her primary job function

• Possess the authority to hire and terminate or recommended said action or other changes in an employee’s working status

• Be compensated on a salary basis

• Spend no more than 1/5th of their time in activities not closely related to any of the above duties or 40% in a service or retail establishment

To be exempt—according to MT Overtime Laws—as an Administrative Employee, a person must:

• Possess as their “primary duty” the following:

o Non-manual or office work related to management policies or traditional business operations

o Performing work in an educational administration function, aka work directly related to training or academic instruction

• Regularly exercise independent judgment and discretion

• Directly assist bona fide executives or other administrative employees

• Perform general supervision work that is technical or specialized that requires special training, knowledge or experience

• Perform special assignments under only general supervision

To be exempt as a Professional Employee—according to MT Overtime Laws—one must:

• Have his/her primary duties include :

o Advanced knowledge typically requiring extensive education

o Creativity in a recognized artistic field

o Teaching imparting knowledge as a formal professor or teacher in an academic institution

o Practical application of highly specialized knowledge in computer platforms, programming, software engineering etc.

• Constantly exercises discretion and judgment

• Performs work that is predominantly eclectic and intellectual and which cannot be standardized in relation to a given time frame

• Spend no more than 20% of working hours—during a typical work week—in activities viewed as non-essential to the above duties

• Compensated on a “salary basis”

For a complete list of Montana overtime laws, please visit the www.lni.wa.gov/workplacerights/wages/overtime/.