Montana Employment Contracts laws & HR compliance analysis

Montana Employment Contracts: What you need to know

When we think about contracts, we typically imagine lengthy documents filled with legal jargon. Yet, an employment relationship is technically a contractual relationship regardless of whether the terms are put into writing. The employer offers the employee a job; the employee accepts that offer; and the employer provides something of value (also known as consideration) in return for the employee’s services.
Some employment relationships may continue for many years without formal written terms, while others may be negotiated to the final detail by a team of attorneys. Each relationship represents a form of contract.
The most important aspect of an employment contract isn’t the form the contract takes. Rather, the most important (and most easily botched) element of the contract is ensuring that once both parties have understood and mutually agreed upon terms, the subsequent words and actions of the parties then preserve those intentions.
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Montana is the exception to the at-will rule. Under Montana law, there are three recognized types of employment relationships. These include collective bargaining agreements; individual written employment agreements providing for a specific term of employment, e.g., employment for 1 year; and all other employment relationships.
Unlike many states where this last category falls under the default rule of at-will employment, in Montana these employment relationships are governed by the Wrongful Discharge from Employment Act (the Act) (MT Code Sec. 39-2-901et seq.).
The Act limits an employer's right to terminate an employee at will or without good cause. Under the Act, a discharge from employment is wrongful and, therefore, actionable if:
• The discharge ...

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