7 Tips for Hiring Employees in Montana: The Employer’s 2023 Guide

Nicole Rothstein

Are you an employer ready to hire new employees in Montana? This great state was named by Forbes as the seventh-best state in which to start a business. Whether you’re part of the state’s agricultural industry, retail, food services, or another one of Montana’s many thriving industries, hiring is a critical component to owning and growing a business.

Hiring new employees is exciting. New team members can  help increase productivity and boost your bottom line. It also comes with many state and federal requirements, which  may feel like an overwhelming and time-consuming experience, but we are here to help with that part!

Check out these seven tips for hiring employees in Montana.

1. Get your Employer Identification Number, insurance, and labor posters

There are a number of requirements that Montana employers have to follow when it comes to hiring. For example, have you already secured an Employer Identification Number (EIN) for your business? If you’re a new employer looking to hire your first employee in the state of Montana, you will need to start by applying for an EIN. A company’s unique EIN is used for tax administration purposes, opening a bank account,  applying for licenses and permits, and registering for Workers’ Compensation insurance and unemployment insurance. Note that for unemployment insurance, you’ll retain this from the Montana Department of Labor & Industry and you’ll also need a withholding account number from the Montana Department of Revenue. 

Also, both state and federal law require businesses to display certain labor law posters and notices in areas visible to workers. Find out which posters are needed for your Montana business and then access those posters here.

2. Know Montana’s employee rights

Before hiring employees, it’s important to know what rights workers have in the state of Montana, such as those pertaining to wages, payments, overtime, breaks, and leaves of absence.

In terms of wage laws, Montana’s minimum wage rate is $9.95 per hour. (This supersedes the federal minimum wage of $7.25 per hour.) Tips, gratuities, and service charges are not calculated as part of the minimum wage.

When it comes to overtime, Montana follows federal law. Non-exempt employees in Montana must be paid time and a half for overtime. Generally, once an employee has worked 40 hours in one week, all additional hours that week are considered overtime. There are, however, state-specific child labor laws that employers need to be aware of, such as specific ages and hours minors are permitted to work. Montana law also requires that employers provide employees with family and parental time off for the birth or adoption of a child.

3. Prepare your business for hiring

First, assess what responsibilities you need to be covered. Do you require a full-time or part-time employee? Or, does it make more sense to utilize the services of an independent contractor? If you don’t have any previous experience in hiring an independent contractor, learn more on Gusto’s Talk Shop blog.

Consider how much your business can afford to pay in terms of compensation. Also, determine the benefits you’ll provide, and the cost (if any). This may include health insurance, a flexible workweek, childcare, and more. Stay competitive in today’s hiring market; work with Gusto to set your business apart with benefits that make a difference.

Now you’re ready to write a job description. It’s important to accurately communicate your needs and what you’re looking for in a candidate, and provide compelling reasons for why someone would want to work for your company. Include your company’s benefits and compensation, as well as a description of your company culture. 

Remember that, in accordance with the Montana Human Rights Act, it is illegal for an “employer to refuse employment to a person, to bar a person from employment, or to discriminate against a person in compensation or in a term, condition, or privilege of employment because of race, creed, religion, color, or national origin or because of age, physical or mental disability, marital status, or sex when the reasonable demands of the position do not require an age, physical or mental disability, marital status, or sex distinction…”

Share your legally compliant and inclusive job description appropriate outlets—whether it’s with the help of a recruiter, on online job boards, or social media groups—to ensure you attract top talent.

If you are new to the hiring market or you’re looking to expand an existing business, creating and consistently updating an employee handbook is another way to ensure your business is ready to add workers. Check out these top policies to include in your employee handbook.

4. Find the right fit employee

Hiring an employee is a commitment; Montana is the only state that is not an at-will employment state. This means that employers must have good cause for terminating a person’s employment. 

Be sure to take the time to create a thoughtful interview process, which includes several steps. For example, you may start with a basic phone screening and skills assessment before moving on to the interview stages. Below are some resources to help you plan:

5. Fill out (more) legal documents

So, you have your new hire selected and they have accepted your offer—congratulations! Here are the next tasks:

  1. Have each new employee confirm citizenship and eligibility to work in the United States by submitting an Employment Eligibility Verification Form, or I-9.
  2. Comply with Montana’s new hire reporting requirements by reporting new employees to the Montana Department of Public Health and Human Services within 20 days of the date of hire. The state uses this information for many important purposes, including to enforce child support orders and prevent fraud.

6. Set up payroll taxes

Setting up payroll properly is of critical importance. The first step is to have each new employee provide you with a Withholding Certificate, or W-4, which is used to determine federal income tax withholding. If an employee fails to complete and submit a W-4, you will need to withhold taxes from their paycheck as though they are not claiming any exemptions. Additionally, the Montana Withholding Allowance and Exemption Certificate, or MW-4, must be completed for all new employees. Both the W-4 and MW-4 should be updated any time an employee has a life event that could impact their taxes, such as marriage or divorce and the birth or adoption of a child.

There are several other forms that need to be completed, as well.Luckily for you, Gusto has already done a lot of the leg work. Check out our hourly and salary paycheck and payroll calculators for Montana. Both of these resources provide detailed information on things like Additional Medicare tax, how frequently to pay your employees, what information should be included on pay stubs, and other topics relevant to running a business in Montana.

7. Considerations for remote workers

There are times when, in order to find the best employee for the job, it may be necessary to look outside of Montana. Thanks to technology and the increased accessibility it provides, it’s possible for individuals from any corner of the world to become employees of your Montana business.

However, one thing to be aware of when seeking workers beyond Montana’s borders is that you may need to meet the employment requirements of the state or country in which those workers reside. Do your due diligence  to familiarize yourself with the legal requirements for out-of-state workers.

We hope you’ve found this employment information helpful as you set about hiring employees in Montana. Whether you’re hiring your first employee or adding to an existing team, check out Gusto’s hiring and onboarding software. Growing your staff might seem overwhelming at times, but we’re here to simplify and streamline your recruiting, hiring, and onboarding procedures so that your Big Sky Country business is compliant and ready for success.

Nicole Rothstein Nicole Rothstein covers a variety of topics related to finance, small business advocacy, and workforce and regional development. In addition to writing for and managing several blogs and publications, she has worked closely with federations, chambers of commerce, nonprofits, small businesses and financial institutions to create impactful content marketing strategies.
Back to top