Vermont Wage Payment Laws

Frequency of Wage Payments

An employer must pay employees their wages once per week unless it has given employees written notice, then an employer may pay employees bi-weekly (once every two weeks) or semi-monthly (twice per month). Wages must be paid within six (6) days of the last day of the pay period.

If an employee is absent from his regular place of employment on the employer’s regular scheduled payday, the employer must pay the employee upon demand. VT Statute 21-342

Manner of Wage Payments

An employer may pay his employees by:

• cash,
• check, or
• direct deposit, if authorized in writing by the employee
• payroll card, if authorized in writing by the employee

VT Statute 21-342

Direct Deposit

An employer may pay an employee by direct deposit if the employee has consented in writing. VT Statute 21-342

Payroll Card

Vermont labor laws allow employers to pay employees by payroll card if the following conditions are met:

• The employee’s wages, salary, or other employee compensation is deposited directly or indirectly in a federally insured depository institution.
• The employer provides the employee with a written disclosure in plain language, in at least 10-point type of:
  • all the payment methods available to the employee and
  • the terms and conditions of the payroll card account option, including
    • a complete list of all known fees that may be deducted from the employee’s payroll card account by the employer or the card issuer and
    • whether third parties may assess fees in addition to the fees assessed by the employer or issuer.
• The employer provides copies of all required written disclosures in the employee’s primary language or in a language the employee understand.
• The employer ensures that the payroll card account provides that during each pay period, the employee has at least three free withdrawals from the payroll card, one of which permits withdrawal of the full amount of the balance at a federally insured depository institution or other location convenient to the place of employment.
• None of the employer’s costs associated with the payroll card account are passed on to the employee.
• The employer may not receive any financial remuneration for using the pay card at the employee’s expense.
• At least 21 days before any change takes effect, the employer provides the employee with written notice in plain language, in at least 10 point type, of the following:
  • any change to any of the terms and conditions of the payroll card account, including any changes in the itemized list of fees;
  • the employee’s right to discontinue receipt of wages by a payroll card account at any time and without penalty; and
  • the employer may not charge the employee any additional fees until the employer has notified the employee in writing of the changes.
• The employer provides the employee the option to discontinue receipt of wages by a payroll card account at any time and without penalty to the employee.
• The payroll card issued to the employee shall be a branded-type payroll card that complies with both the following:
  • can be used at a PIN-based or a signature-based outlet.
  • the payroll card agreement prevents withdrawals in excess of the account balance and to the extent possible protects against the account being overdrawn.
• The employer ensures that the payroll card account provides one (1) free replacement payroll card per year at no cost to the employee before the card’s expiration date. A replacement card need not be provided if the card has been inactive for a period of at least 12 months or the employee is no longer employed by the employer.
• A nonbranded payroll card may be issued for temporary purposes and shall be valid for no more than 60 days.
• The payroll card account shall not be linked to any form of credit, including a loan against future pay or a cash advance on future pay.
• The employer may not charge the employee an initiation, loading, or other participatory fee to receive wages payable in an electronic fund transfer to a payroll card account, with the exception of the cost required to replace a lost, stolen, or damaged payroll card.
• The employer must ensure that the payroll card account provides to the employee, upon the employee’s written or oral request, one free written transaction history each month which includes all deposits, withdrawals, deductions, or charges by any entity from or to the employee’s payroll card account for the preceding 60 days. The employer must also ensure that the account allows the employee to elect to receive the monthly transaction history by electronic mail.

The employer’s obligations and the protections regarding payroll card account payments cease 30 days after the employer-employee relationship ends and the employee has been paid his or her final wages. When the employer-employee relationship ends:

• the employer shall notify the financial institution of any changes in the relationship between the employer and employee; and
• the financial institution holding the individually owned payroll card account shall provide the employee with a written statement in plain language describing a full list of the fees and obligations the employee might incur by continuing a relationship with the financial institution.

VT Statute 21-342

Payment upon Separation from Employment

Employees who are fired, discharged, terminated, or laid off

An employer must pay employees who are discharged or laid off from employment within 72 hours of the discharge. VT Statute 21-342

Employees who quit or resign

An employer must pay employees who voluntarily leave their employment on the payday following the separation from employment, or if there is no established payday, on the following Friday. VT Statute 21-342

Employees who are suspended or resigns due to a labor dispute (strike)

Vermont has no law regarding when an employer must pay an employee who has resigned due to a labor dispute. Presumably, an employer would pay an employee who resigns employment due to a labor dispute on the payday following the separation from employment, or if there is no established payday, on the following Friday.

Wages in Dispute

Vermont does not have any laws requiring an employer to pay an employee wages conceded to be due when involved in a wage dispute with the employee.

Deductions from Wages

According to Vermont’s Department of Labor, an employer may not withhold or deduct wages from an employee’s paycheck for:

• cash shortages
• breakage, damage, or loss of the employer’s property

Vermont labor laws allow employers to deduct the following items from employees’ wages:

• goods and services provided by the employer to the employee if the following conditions are met:
  • The deduction does not reduce an employee’s wages below the hourly minimum wage.
  • The employee provides written authorization or the employer sufficiently documents the employee’s intention to repay.
  • The deduction is not prohibited by state or federal law.
  • The deduction does not exceed the amount agreed to by the employee.
• specifically authorizedby state or federal law including deductions for state and federal taxes and child support.
• with written authorization from the employee, make deductions for contributions for health insurance or retirement plans.
• an allowance for meals and lodging actually furnished and accepted in the amounts indicated in the Vermont Minimum Wage Rules.

VT Dept. of Labor FAQs

Uniforms, Tools, and Other Equipment Necessary for Employment

Vermont wage payment laws prohibit employers from deducting any amount from employee wages for providing or maintaining required apparel, including uniforms, or requiring employees to otherwise pay for providing or maintaining required apparel, including uniforms, unless the employee voluntarily consents to the deduction or other payment in writing and the deduction does not:

• reduce the employees total compensation below the hourly minimum wage;
• include any administrative fees or charges;
• amend, nullify, or violate the terms of any collective bargaining agreement

An employer may neither deduct from an employee’s wages nor require an employee to pay any amount for personal protective equipment required by occupational safety and health regulations, except as allowed by sections 1910.132(h) and 1926.95(d) of Title 29 of theCode of Federal Regulations.

VT Dept. of Labor FAQs

Pre-hire Medical, Physical, or Drug Tests

An employer may not require an employee or applicant for employment to pay the cost of a medical examination as a condition of employment. VT Statute 21-301

Notice of Wage Reduction

Vermont does not have any laws addressing when or how an employer may reduce an employees wages or whether an employer must provide employees notice prior to instituting a wage reduction. Any wage reduction can only be applied to hours worked after the change and cannot be applied to hours already worked.

Statement of Wages (Pay Stub)

Vermont labor laws require employers to provide employees wage statements (pay stubs) each pay day that set forth, at a minimum, the total hours worked, the hourly rate, gross pay, and each deduction fully itemized. VT Dept. of Labor FAQs

Record Keeping Requirements

Vermont labor laws require an employer to keep a true and accurate record for two (2) years of the hours worked by each employee and of the wages paid to him or her. Vermot unemployment laws require employers to keep the same records for three (3) years. VT Statute 21-393

Notice Requirements

Vermont does not have any laws requiring employers to provide employees notice of wage rates, dates of pay, employment policies, fringe benefits, or other terms and conditions of employment.