With the conclusion of the Vermont legislative session, there are a few important updates Vermont employers should note.

COVID Related Leave Grant

The passage of S.11, an omnibus spending bill, establishes a COVID-19-Related Paid Leave Grant Program (the “Program”), which will be administered through the Department of Financial Regulation. The Program will use grants to reimburse employers who provide COVID-19 related paid leave to employees during fiscal year 2022 (July 1, 2022 to June 30, 2023). Reimbursement is limited to leave taken for a “COVID-19 related reason,” and there are a number of reasons which qualify. The eligibility criteria is outlined in Sec. 51a of S.11.

Applications for participation in the program are expected to open on October 1, 2022 and close on September 30, 2023, and employers will be limited to submitting one application per calendar quarter during that period. Grants may be used to reimburse employers who provide leave for a COVID-19 related reason, including to provide retroactive payment to employees who took unpaid leave for a COVID-19 related reason during the Program period. Grants may only be sought for reimbursement for up to 40 hours for each eligible employee, and employers will only be eligible to receive up to $850 for each employee who takes COVID-19 related leave.  Details of the program are still being finalized and updates are expected in the coming months as the Department of Financial Regulation prepares to receive grant applications.

Unemployment Insurance

S.11 also contained changes to the unemployment law. This provision revisits a compromise reached in the last legislative session to provide supplemental benefits, which unfortunately did not conform with federal requirements and could not be implemented. Now, the legislature has agreed that the maximum weekly benefit will be increased by $60 for the next three years.

Other Proposed Legislation

There were also several bills that would have changed the Vermont employment landscape that died during the legislative session. Those bills included measures to:

  • Modify the sexual harassment law to eliminate the need to demonstrate that the activity was “severe and pervasive” to constitute unlawful harassment, establish a six-year statute of limitations for claims of harassment, eliminate the need to demonstrate that a similarly situated employee was treated differently to establish unlawful harassment, and to encourage employees to directly complain to the Attorney General’s office or the Equal Employment Opportunity Commission, instead of complaining internally first. 
  • Further study or enact Paid Family and Medical Leave.
  • Prohibit “no re-hire” clauses in private settlement agreements related to claims of sexual harassment.
  • Increase the minimum wage to $15 per hour by 2025.
  • Adopt the Uniform Restrictive Covenants Act, which would modify the notice requirements and further limit and define what may be included in restrictive covenants.
  • Require small non-profits to provide notice that their employees are not eligible for unemployment, as well as potentially requiring bonding to ensure solvency of the Unemployment Insurance fund and requiring small non-profits to provide unemployment benefits to their employees.

In the next legislative session, employers can reasonably anticipate that proposals will be made to enact Paid Family and Medical Leave, especially with the growing number of states that provide this benefit, and an increase in the minimum wage.