Montana tip pooling laws & tipped minimum wage
Montana is one of only seven states that ban the tip credit: every tipped worker gets the full minimum wage in cash, and tips are paid on top.
| Regular minimum wage | $10.85/hr |
| Minimum cash wage for tipped workers | $10.85/hr (full minimum) |
| Maximum tip credit | Not allowed |
| Tips belong to | Employees — always |
A tip credit lets an employer count your tips toward the minimum wage it owes you. Rates reviewed July 2026. Rates change — confirm with the Montana labor department. Not legal advice.
What's specific to Montana
Montana bans the tip credit — tipped workers receive the full minimum wage before tips.
Montana pays tipped workers the full minimum — there is no tip credit
Montana does not allow a tip credit. As of January 1, 2026, the state minimum wage is $10.85 an hour, and tipped workers must be paid that full $10.85 in cash. Your tips are yours on top of that wage, not a substitute for part of it.
Because there is no tip credit, there is no shortfall math to worry about — your paycheck cannot dip below the full minimum no matter how slow a shift is.
The minimum rises every January, with one small-business exception
Montana adjusts its minimum wage each January based on the Consumer Price Index, which is how it reached $10.85 for 2026. A narrow exception exists: a business that is not covered by the federal Fair Labor Standards Act and has gross annual sales of $110,000 or less may pay $4.00 an hour instead.
That $4.00 rate is rare. If your work involves goods moving across state lines, or your employer is otherwise covered by federal law, you are entitled to the higher of the federal or Montana minimum wage — in practice, the full $10.85.
Because no tip credit is taken, a mandatory tip pool can include the kitchen
In a state with no tip credit, an employer may run a mandatory tip pool that shares tips with back-of-house staff such as cooks and dishwashers, because the employer is already paying everyone the full minimum wage in cash. Managers, supervisors, and owners may not take a share of the pool. If tips are being withheld or diverted improperly, you can contact the Montana Department of Labor and Industry, Wage and Hour Unit.
Tip pooling in Montana
Montana follows the federal baseline for pooling: employers may require tip pooling, and because no tip credit exists, pools may legally include back-of-house workers like cooks and dishwashers. Managers and supervisors are always excluded.
One federal rule applies everywhere: managers and supervisors can never take from a tip pool. Separately, credit card processing fees may only be deducted from tips where state law allows it — and several no-tip-credit states restrict that practice too.
What this means for your tip-out
Because Montana pays the full minimum wage before tips, your base pay does not depend on how the pool splits. Use the tip-out calculator to split a shift by your house's percentages or by hours, and see standard tip-out percentages to check whether your house's rates are typical.
Montana tip law FAQs
What is the tipped minimum wage in Montana?
Montana does not allow a tip credit, so tipped employees must be paid the full minimum wage of $10.85/hr in cash. All tips come on top of that wage.
Is mandatory tip pooling legal in Montana?
Montana follows the federal baseline for pooling: employers may require tip pooling, and because no tip credit exists, pools may legally include back-of-house workers like cooks and dishwashers. Managers and supervisors are always excluded.
Can my manager take a share of the tip pool in Montana?
No. Federal law prohibits managers, supervisors, and owners from keeping any portion of employee tips in every state, including Montana. A manager may keep only tips they directly and solely earned (e.g., a table they personally served start to finish).
Can my Montana employer pay me less than $10.85 because I earn tips?
No. Montana does not permit a tip credit, so tipped employees must be paid the full $10.85 minimum wage in cash. Any tips you earn are on top of that wage.
When does Montana’s minimum wage change?
It adjusts every January based on the Consumer Price Index. The rate reached $10.85 on January 1, 2026, and will be recalculated again the following January.