Vermont Employment and Labor Laws

One common employment and labor law violation experienced by workers across the country — including in Vermont — is wage theft. This sometimes coincides with other kinds of illegal practices, such as workplace discrimination or wrongful termination.

In one particular case, a Vermont employee was illegally fired after pursuing wages owed to them. Because their employer violated the Fair Labor Standards Act, the employee was able to recover over $28,000 in damages. During the investigation of the case, it was discovered that the business also failed to pay the overtime salaries of other employees. Consequently, the court ordered it to pay an additional $17,000 in damages. As evident in this lawsuit, the state’s employment and labor laws can help wronged workers seek justice.

In line with this, it’s important to know that employment and labor law, although related, are two distinct concepts that cover different aspects of the employee-employer relationship. Employment law deals primarily with the rights of an employee as an individual. It addresses matters like minimum wage, work hours, overtime pay, and benefits. Meanwhile, labor law is about the rights of employees as a group, including collective bargaining agreements and labor unions.

Both legal fields are discussed in this article to serve as a guide for individuals whose workplace rights may have been violated and who are looking for ways to seek rightful compensation.

Vermont Wage and Hour Laws

Minimum Wage

As of January 1, 2023, all Vermont employers with at least two employees are required to pay them at least $13.18 per hour. This shows an increase from the state’s 2022 minimum hourly wage, which was $12.55.

Like in other states, the increase in the minimum wage rate in Vermont is based on the Consumer Price Index. Any Vermont employer who pays less than the state’s imposed minimum wage shall be penalized up to $100 for each day the violation occurs.

An underpaid employee may also bring legal action against their employer through a civil lawsuit. Per state law, an underpaid employee may receive twice the minimum wage minus the amount paid by their employer. The employer will also have to pay for the employee’s attorney’s fees.

However, do note that some types of workers are not protected by the state’s minimum wage rules. These include:

• Domestic workers.

• Federal employees.

• Full-time high school students.

• Outside salespersons.

• Taxi drivers.

• Agriculture workers.

• Newspaper deliverers.

• Nonprofit workers.

Wage Rules for Tipped Employees

Tipped employees are those whose nature of work is to serve guests or customers. Examples include workers in hotels, motels, tourist spots, and restaurants who regularly earn more than $120 in tips per month.

As of 2023, the minimum wage for tipped employees in Vermont is $6.59 per hour. However, if the total amount of tips earned by an employee in a given month is below $120, their employer should cover the rest of their wage to reach the state’s standard minimum wage rate.

Schedule of Wage Payment

Any Vermont employer with at least one employee must pay their wages in cash or check on a weekly basis. The payment must be made no more than six days before the payday schedule.

Work Hours

An employee in Vermont can work for up to 40 hours per week. If they exceed this number, their employer must pay them 1.5 times their regular hourly rate for every hour worked beyond the 40-hour limit.

However, employees from the following types of businesses are exempt from overtime compensation under Vermont law:

• Retail or service establishments.

• Amusement or recreational businesses (with restrictions).

• Hotels, motels, and restaurants.

• Political subdivisions of Vermont.

• Healthcare providers (with restrictions).

Rest Breaks

Some states do not require employers to provide meal or rest breaks to their employees. In contrast, Vermont law demands all employers provide reasonable break time to their workers to allow them to use the restroom and have meals.

Nursing Mothers

Under Vermont law, employers of nursing mothers are required to provide them with a private space for at least three years where they can express their breastmilk. However, it’s the employer’s prerogative whether to compensate an employee for the time they spend expressing milk.

Employers that violate this law may face civil action from Vermont’s Attorney General. They will be made to pay for economic damages, such as lost wages for up to one year, as well as court and investigation fees.

In some instances, an employer may be exempt from this law if providing private space and time can greatly affect their operations.

Work Benefits

Paid Sick Leave

Most workers in Vermont can use 40 hours of earned sick leave per year for the following reasons:

• To recover from an illness.

• To get diagnostic, preventive, routine, or therapeutic care.

• To tend to a sick family member.

• To obtain professional help for a family member who is a victim of domestic violence, stalking, or sexual assault and requires relocation due to the incident.

• For emergencies, like picking up a family member for security reasons.

An employee must notify their employer before taking a sick leave. But if the reason for the absence is unexpected, an advance notice is not necessary.

Do note that these rules do not apply to particular types of workers, such as:

• Federal government employees.

• Employees working for a company for less than 20 weeks.

• Healthcare employees with an intermittent work schedule.

• School district employees.

• Minor employees.

• Sole proprietors and partners.

• Executive officers, managers, and members of an LLC.

• Independent contractors.

Workers’ Compensation

Workers’ compensation insurance is a policy that pays for expenses related to occupational injuries and illnesses incurred by employees. It covers costs related to medical fees, lost wages, short-term and long-term disabilities, and funeral expenses.

Vermont employers with at least one employee are required to carry workers’ compensation coverage. Sole proprietors and partners are typically excluded from coverage, but they may opt-in if they prefer to.

An employer can purchase this type of policy from a private insurance company. Due to the high-risk nature of their business, those who cannot get this insurance from a private carrier may obtain coverage from the residual market through the National Council on Compensation Insurance.

Vermont businesses may also choose to self-insure if they meet certain qualifications regarding profit and assets, cash flow, bonds, and excess liability.

Employees who want to check if their employer carries workers’ compensation coverage may visit the state’s Department of Labor Employer Insurance Coverage Verification page.

Workplace Poster Requirement

Employers in Vermont are mandated to put up various posters in prominent areas of the workplace. These include posters regarding the following:

• Vermont Minimum Wage.

• Workers’ Compensation Reinstatement Rights.

• Parental and Family Leave.

• Child Labor.

• Accommodations for Pregnant Employees.

• A-24 Unemployment.

• Employer’s Liability and Workers’ Compensation.

• Vermont’s Earned Sick Time Act.

Layoffs

According to Vermont's labor laws, businesses with at least 50 employees planning a mass layoff must notify the Secretary of Commerce and Community Development and the Commissioner 45 days before the scheduled layoff. In addition, the employer should also give a 30-day notice to the affected employees and the local chief elected official.

Failure to do so translates to an administrative penalty of $500 for each day the required notice is not provided. The employer should also pay the laid-off employees their unpaid wages within 72 hours.

Is Vermont an At-Will Employment State?

Yes, Vermont is an at-will employment state. This means an employer can fire an employee at any time for any reason. However, the reason for discharge must not violate public policy, breach a provision of a contract, or be illegal in any way.

What Qualifies as Wrongful Termination in Vermont?

A termination in Vermont is considered wrongful if it violates the law or the agreements in an employment contract. Wrongful termination may stem from various situations, such as the following:

Discrimination

Under the Fair Employment Practices Act, employers with at least one employee are prohibited from terminating an employee for the following reasons:

• Race.

• Religion.

• Sex, sexual orientation, or gender.

• Age.

• Mental or physical disability.

• Place of birth and ancestry.

Retaliation

Retaliation occurs when an employee who engages in a protected activity — such as filing a workplace complaint with a government agency (whistleblowing) or cooperating in investigations — is punished by their employer. Some forms of retaliation are:

• Giving an unfair performance evaluation to an employee who resisted their manager’s sexual advances.

• Physically or verbally abusing a worker after they made a complaint to the HR department about workplace bullying.

• Demoting or dismissing an employee for talking about salary with their coworkers.

Breach of Contract

Employment in Vermont is protected from at-will rules if it involves a contract stating the length of the employer-employee relationship. A breach occurs when the employee is terminated before their contract ends.

How Do You Report an Employer in Vermont  for Wrongful Termination?

Employees who experience discrimination-based termination in the workplace may file a complaint with the Civil Rights Unit of the Attorney General of Vermont by answering the corresponding questionnaire. This may be sent via email to ago.civilrights@vermont.gov.

Whistleblowers who were terminated from their jobs may submit a report to the Vermont Department of Labor by completing the Whistleblower Retaliation Complaint Form.

Meanwhile, wrongfully terminated individuals employed by the state may file a complaint with the Vermont Human Rights Commission if their firing was motivated by discriminatory reasons. Those who intend to take this step have one year to initiate their complaint. To file a report, the appropriate form should be filled out and mailed to the following address:

Vermont Human Rights Commission
14-16 Baldwin Street
Montpelier, Vermont, 05633-6301

It can also be sent by fax to 802-828-2481 or through email to human.rights@vermont.gov.

Another option for those discharged due to discrimination involves filing a report with the Equal Employment Opportunity Commission through the EEOC public portal. One is given 180 days to take action, but if the discrimination involved is also disallowed per Vermont law, the time limit can extend up to 300 days.

For employees who need to escalate their claim into a wrongful termination lawsuit, hiring an employment lawyer can increase the chance of a successful case. An experienced attorney can evaluate the facts surrounding the incident, provide legal advice, and explain one’s legal rights as an employee. They can also provide representation in court or during settlement negotiations.

What is the Statute of Limitations for Wrongful Termination Cases in Vermont?

Employees who wish to pursue a wrongful termination lawsuit in Vermont have six years to pursue legal action if their case involves a breach of oral or written contract.

Meanwhile, wrongful termination cases that involve the violation of public policy should be filed within three years. Some situations that fall under this category are:

• Being fired for reporting one’s employer to the authorities for committing illegal practices.

• Getting dismissed for filing a workers’ compensation claim.

Because the given timeframe is dependent on the specifics of one’s case, knowing when and how to hire a lawyer is valuable for a successful outcome.

How Much Can Someone Sue an Employer in Vermont for Wrongful Termination?

Determining how much a wrongful termination case is worth can be a complicated endeavor since it depends on a variety of factors. These include the calculated value of the following:

• Economic damages: These refer to the monetary losses a victim incurs, such as the income and benefits they would have received if they were not fired. These also include any unpaid wages they are entitled to.

• Non-economic damages: These are the types of losses that are non-monetary. Some examples include the emotional distress and mental anguish experienced by a person after being wrongfully fired by their employer.

• Punitive damages: These serve to punish the offending employer if they illegally fire a worker in a malicious or egregious manner. One particular example involves a person obtaining $25,000 in punitive damages after they got fired for attempting to report a workplace violation to the authorities.

Other considerations when calculating the value of one’s case are the limits imposed on these damages by the EEOC based on an employer’s size:

Note that EEOC laws on discrimination-based firing do not apply to employers with fewer than 15 workers.

Resources for Employees in Vermont

Vermont Human Rights Commission

The Vermont Human Rights Commission is a state agency that protects individuals against discrimination in housing, public accommodations, and employment. It also enforces the civil rights of Vermont residents. The VHRC holds workshops and training programs to educate locals about various legal topics. These include workplace harassment prevention, fair housing issues, service and assistance animals, and implicit bias and bystander intervention. Call 802-828-2480 or send an email to human.rights@vermont.gov for more information.

Vermont Department of Labor

The Vermont Department of Labor is a state agency with the mission of improving the well-being of the local workforce. It caters to the needs of both employees and employers in the state. Its website has information on workplace rights and wages. It also lists the mandatory posters that employers need to have in the workplace. Employees experiencing issues with wages and hours at work may file a complaint using the Online Wage Claim Form. Call 802-951-4083 for more details.

Vermont Agency of Human Services

Wrongfully terminated individuals who suddenly find themselves in need of financial aid or other forms of assistance may reach out to the state’s Agency of Human Services. It has several programs on affordable housing, food and financial support, health and wellness, and employment and job training. Its website also has a job postings page and various employment-related guides. To learn more about the agency and its services, call 211 or contact the office near you.

Vermont Department of Health

Victims of unlawful dismissal who have found a new job may be interested in knowing how their current place of employment can have a healthier workplace culture. The state’s Department of Health has various resources and programs in line with this. These include workshops on worksite wellness and guides that promote the well-being of employees.

GLBTQ Legal Advocates & Defenders

GLBTQ Legal Advocates & Defenders, also known as GLAD, is a movement committed to combating gender-based discrimination in Vermont and the rest of New England. It helps victims — including those discriminated against in the workplace — through legal assistance, a lawyer referral program, and various resources found on its website. You can reach out to the organization if you have discrimination-related queries by filling out and submitting its intake form or sending an email to GLADAnswers@glad.org.