Frequently Asked Questions

Questions and Answers Re-published from Main Street Montana Archives    

My employees would like the option of banking extra hours worked (above 40 in a work week) instead of receiving overtime pay. Can I legally do that? 
If you were a private employer you would probably be violating Wage and Hour laws. MCA 39-3-405 states (1) No employer shall employ any of his employees for a workweek longer than 40 hours unless such employee receives compensation for his employment in excess of 40 hours in a workweek at a rate of not less than 1 1/2 times the hourly wage rate at which he is employed.

Although some exemptions exist for paying of overtime (see MCA 39-3-406), the practice of allowing comp time in lieu of paying overtime is generally considered illegal for private employers.

We currently have a policy that states an employee must use their earned vacation hours by December of that year or lose those vacation hours earned. Is this a legal practice?
No. All wages earned are due and payable period. Legally, you cannot have a use-it or lose-it policy on vacation pay. You can adopt a policy that limits the employee's ability to earn vacation pay at a designated level of hours (cap). Once the employee's earned vacation hours drop below that limit, the employee's ability to earn vacation pay restarts. 

Our Employee Handbook states, "We are an At-Will employer and the employee or the employer has the right to terminate employment at any time". Does that mean our company can legally discharge any employee for any reason? 
Montana is unique on this one. We have a "Wrongful Discharge from Employment Act". MCA 39-2-901 states a discharge is wrongful only if:
1) It was in retaliation for the employee's refusal to violate public policy or for reporting a violation of public policy;
(2) The discharge was not for good cause and the employee had completed the employer's probationary period of employment; or
(3) The employer violated the express provisions of its own written personnel policy.

The only time Montana employers can practice "At Will Employment" in Montana is during the employee's probationary period. 

Caution: Discharging an employee during their probationary period will be considered an illegal act if the discharge is based on protected class reasons (illegal discrimination), if you violate your own company policies, or as stated in (3) above, "It was in retaliation for the employee's refusal to violate public policy or for reporting a violation of public policy".

Exemptions (39-2-912) from the "Wrongful Discharge from Employment Act" include:
(1) That is subject to any other state or federal statute that provides a procedure or remedy for contesting the dispute. The statutes include those that prohibit discharge for filing complaints, charges, or claims with administrative bodies or that prohibit unlawful discrimination based on race, national origin, sex, age, disability, creed, religion, political belief, color, marital status, and other similar grounds.
(2) Of an employee covered by a written collective bargaining agreement or a written contract of employment for a specific term. 

If I fire someone will they be eligible to receive unemployment benefits?
It's possible. The employee is entitled to benefits unless they voluntarily quit (for personal reasons) or were fired for gross misconduct. If misconduct is found, the individual is disqualified from receiving benefits until returning to work (other than self-employment) and earning eight times the weekly benefit amount.
To be considered misconduct, the individual must have had control over the situation and the behavior must have had an adverse affect on your business interests. These interests might be the good will of customers, business reputation, business costs and efficiency, morale of other employees, honesty, trust and loyalty.
Inefficient or poor work performance, good faith errors in judgment, discretion and mistakes or simple negligence are not misconduct.



Can a claimant quit and still receive unemployment insurance benefits?
Under some circumstances, a claimant can leave their job and still be eligible for unemployment. If a claimant can show that there are issues with their employment that the employer was made aware of and did not correct or address in a reasonable period of time they may be eligible. Some examples are:
Claimant was not paid appropriately (minimum wage or overtime);
The employer did not have workers' compensation coverage; or
The claimant was being harassed on the job and the employer did not respond to the complaint.
In each of these cases, the burden of proof would be with the claimant to provide enough evidence to substantiate their claim.

How are separations investigated?
A Customer Service Representative from one of our unemployment insurance telephone centers investigates quit and discharge issues. We may contact your business via phone, fax or mail to obtain specific separation information for each claim. We prefer to get most information via phone to expedite the process. However, we will fax or mail statements depending on your preference.

Can someone work for me part time and still receive unemployment insurance benefits?
Yes. Someone may receive partial unemployment benefits if they continue to work less than forty hours a week and earn less than twice their weekly benefit amount. Partial benefits are intended to give a claimant incentive to accept less than full-time work while they are looking for full-time employment.

One of my part time employees is receiving benefits. Am I being charged?
If you haven't reduced the employee's wages or hours, you will not be charged for any benefits the claimant receives. You must respond to the Division in a timely manner with the requested information.

Send your questions to the Commissioner's Office, Department of Labor and Industry, PO Box 1728, Helena MT 59620-1728.