Vermont employers deal with one of the tightest labor markets in the country and a set of rules that reach very small businesses. If you have five employees in Burlington, Montpelier or St. Albans, most of this applies to you.
This guide is general information, not legal advice. Confirm the details for your situation.
Pay Transparency at Five Employees
Since July 1, 2025, Vermont employers with five or more employees (at least one working in Vermont) must include the pay or a pay range in job advertisements. For tipped roles, the posting must show the base wage. That is one of the lowest thresholds in the country.
Earned Sick Time
Vermont employees earn one hour for every 52 hours worked, up to 40 hours a year. The law covers employees who average 18 or more hours a week, and employers can set a waiting period of up to one year before use.
The Child Care Contribution
Since July 1, 2024, Vermont employers pay a 0.44% payroll tax to fund child care. The employer must cover at least 75% of it. Up to 0.11% can be withheld from employees. If your payroll provider is not handling this, you have a problem to fix.
Paid Family and Medical Leave Is Voluntary
Vermont's Family and Medical Leave Insurance (FMLI) program is voluntary. Employers with two or more employees can buy the state plan, which offers about six weeks of 60% wage replacement, and individuals could enroll on their own starting in 2025, with benefits from January 1, 2026. Proposals to make it mandatory have not passed.
Minimum Wage
The Vermont minimum wage is $14.42 an hour in 2026, with a tipped wage of $7.21.
Final Pay
- Discharged employees must be paid within 72 hours.
- Employees who quit must be paid by the next regular payday, or the following Friday if there is no regular payday.
Withholding
Vermont has a state income tax, so withholding applies. Employees who live in New Hampshire or New York and work in Vermont, or the reverse, need a careful setup.
Where King & Co. Helps
Most Vermont employers have fewer than 50 people, and HR lands on the owner or bookkeeper. A few hours of expert help a month goes a long way, and with hourly billing, a quiet month costs nothing.
- HR in Burlington and Northwest Vermont
- Recruiting support for a tight labor market
- How billing works
Book a free 15-minute call and we will help you set pay ranges and policies that hold up.
Josh runs HR, payroll and PBJ support for employers across New England and New York, from five-person offices to multi-building nursing home groups. He works in every major payroll system and answers the phone personally.
Book 15 minutes with Josh