A new Vermont law will require most employers to provide paid sick time to employees. Vermont is the fifth state to adopt a paid sick leave law, following Connecticut, California, Massachusetts, and Oregon.  The law will be effective on January 1, 2017.

Some Key Provisions of the New Law:

• While the law takes effect on January 1, 2017, employers with five or fewer employees who are employed for an average of 30 hours or more per week will not be subject to the law until January 1, 2018.

• “Employee” is defined as a person who is employed for an average of 18 hours or more per week during a year. The law also excludes several categories of workers from the statutory definition of “employee,” including federal employees, certain state employees, certain short-term employees, and individuals under 18 years of age, among others.   Accordingly, these workers thus are not entitled to paid sick leave under the law.

• Eligible employees are entitled to accrue one hour of sick leave for every 52 hours worked, subject to the following caps:

  • Between January 1, 2017 and December 31, 2018, Vermont employers may limit an employee’s accrual and use of sick time to 24 hours in a 12-month period.

  • After December 31, 2018, Vermont employers may limit an employee’s accrual and use of sick time to 40 hours in a 12-month period.

• Employees generally must be permitted to carryover unused, accrued sick time from one year to the next year, but employers may limit employees’ use of accrued sick time in any 12-month period in accordance with the 24 or 40 hour caps described above. Employers also may elect to pay an employee for unused sick time in lieu of permitting carryover, but are not required to do so.

• Employers may impose a “waiting period” of up to one year for newly hired employees or for current employees who are employed on the law’s effective date. During the waiting period, employees will accrue sick time, but can be prohibited from using the accrued time until after the completion of the one-year waiting period.

• Employees may use sick for the following purposes: (i) to care for the employee’s or employee’s family member’s illness, injury, need for medical diagnosis or treatment, or need for preventative medical care; (ii) to obtain services or care for the employee or employee’s family member who is a victim of domestic violence, sexual assault, or stalking; or (iii) to care for a family member because the school or business where that individual is normally located during work hours is closed for public health or safety reasons.

• Employees can be required to make “reasonable efforts” to avoid scheduling routine or preventative health care during the work hours. Employers also may require employees to notify the employer as soon as practicable of the intent to take sick time and the expected duration of the employee’s absence.

• Employees generally must be allowed to use sick leave in the smallest time increments that the employer’s payroll system uses to account for other absences or that time off policies permit; however, employers are not required to permit sick leave use in increments of less than one hour.

• Employers must post notice of the law’s requirements in a conspicuous place. Employers also must provide notice of sick leave rights to new hires.

• Vermont employers should review their current sick leave policies and practices and update them in compliance with the requirements of the new law. Preexisting policies (such as sick leave, vacation day, or similar paid time off (“PTO”) policies) can satisfy the Vermont law provided that the accrual rates and permissible uses under the policy are at least as favorable as the new statutory requirements; however, employers should confirm with counsel that these policies are in compliance because the requirements of the new law are likely to be more expansive than existing policies. Vermont employers also should be on the lookout for regulations and other interpretive guidance related to the new law.