Hiring New Employees in Vermont: A Legal Guide

Create a clear job description that outlines the position's responsibilities, required qualifications, and compensation. Ensure the job posting complies with Vermont's fair employment practices and does not contain discriminatory language. Vermont law prohibits discrimination based on race, color, religion, ancestry, national origin, sex, sexual orientation, gender identity, place of birth, age, or disability.

Develop an application form that collects necessary information from candidates while complying with Vermont employment laws. Avoid questions about age, race, religion, national origin, disability, or other protected characteristics. Vermont law specifically prohibits employers from asking about salary history during the hiring process.

Interview qualified candidates and select the best fit for the position. Ensure all interview questions comply with Vermont employment laws and do not discriminate against protected classes. Document the selection process and reasons for hiring decisions to demonstrate compliance with fair employment practices.

Draft an offer letter that includes the position title, start date, compensation, benefits, and any conditions of employment. In Vermont, be clear about whether the employment is at-will or for a specific term. Include information about any probationary period if applicable.

If using a formal employment contract (beyond an offer letter), ensure it clearly outlines terms of employment, compensation, benefits, termination conditions, and any other relevant details. Vermont is an at-will employment state, but a contract can modify this relationship if desired.

If the position requires access to confidential information, prepare an NDA that protects your business interests while being reasonable in scope. In Vermont, NDAs should be narrowly tailored to protect legitimate business interests and not overly restrict an employee's ability to work elsewhere in the future.

If necessary, draft a non-compete agreement that complies with Vermont law. Vermont courts generally disfavor non-compete agreements and will only enforce them if they are reasonable in geographic scope, time duration, and activities restricted. The agreement must protect legitimate business interests and not merely prevent competition.

Create a form that obtains the candidate's consent for background checks. Vermont follows the federal Fair Credit Reporting Act (FCRA) requirements. Additionally, Vermont has 'Ban the Box' legislation that prohibits employers from asking about criminal history on initial job applications, though this can be discussed later in the hiring process.

After receiving signed authorization, conduct any necessary background checks in compliance with Vermont and federal laws. Vermont prohibits employers from asking about expunged criminal records. Follow FCRA requirements for adverse action procedures if you decide not to hire based on background check results.

If this is your first employee in Vermont, register as an employer with the Vermont Department of Labor for unemployment insurance purposes. All employers must register within 30 days of hiring their first employee.

Obtain workers' compensation insurance as required by Vermont law. All employers in Vermont must have workers' compensation coverage for their employees, with very few exceptions. Failure to carry workers' compensation insurance can result in significant penalties.

Have the new employee complete Form I-9 to verify their identity and authorization to work in the United States. The employee must complete Section 1 on or before their first day of work. As the employer, you must complete Section 2 within 3 business days of the employee's first day. Retain this form for the later of 3 years after the hire date or 1 year after employment ends.

Have the employee complete a federal W-4 form to determine federal income tax withholding. Keep this form in your records; you do not need to submit it to the IRS.

Have the employee complete Vermont's W-4VT form for state income tax withholding. Vermont has its own state withholding form that must be completed in addition to the federal W-4.

If offering direct deposit, have the employee complete an authorization form with their banking information. In Vermont, employers cannot require direct deposit as a condition of employment unless certain conditions are met, such as providing an alternative payment method.

Have the employee provide emergency contact information to be used in case of workplace accidents or emergencies.

Report your new hire to the Vermont Department of Labor within 10 days of their start date. This is required by federal and state law for child support enforcement purposes. You can report new hires online through the Vermont New Hire Reporting Center.

If offering benefits such as health insurance, retirement plans, or paid time off, provide the necessary enrollment forms and information. Vermont has specific requirements for certain benefits, such as earned sick time (all employers must provide this benefit).

Give the new employee a copy of your employee handbook that outlines company policies, procedures, and expectations. In Vermont, be sure to include policies on earned sick time (required by law), parental and family leave, anti-discrimination, sexual harassment prevention, and any other state-specific requirements.

Ensure all required federal and Vermont-specific workplace posters are displayed in a prominent location. Vermont requires specific posters including information about minimum wage, workers' compensation, unemployment insurance, workplace safety, sexual harassment, earned sick time, and more. These can be obtained from the Vermont Department of Labor.

Vermont law requires employers to provide sexual harassment prevention training. While not mandatory for all employers, it is strongly recommended and can help establish an affirmative defense in case of complaints.

Establish a payroll system that complies with Vermont wage and hour laws. Vermont has specific requirements for minimum wage ($13.67 as of 2024), overtime, pay frequency (at least bi-weekly), and pay statements. Ensure your system properly calculates and withholds all required taxes and maintains appropriate records.

Ensure your policies comply with Vermont's Earned Sick Time law, which requires all employers to provide employees with earned sick time. Employees accrue 1 hour of sick time for every 52 hours worked and can use up to 40 hours per year. New employees may be subject to a waiting period before using accrued time.