Hiring employees in Vermont: the 2026 compliance checklist for employers and recruiters

As of October 2026, an employer hiring in Vermont has to register with the Vermont Department of Labor (VDOL) for unemployment insurance once it is liable, open a withholding account with the Department of Taxes, which also collects the 0.44% Child Care Contribution, carry workers' compensation insurance, ask each new hire for Vermont's W-4VT, give a copy of its sexual harassment policy and notice of earned sick time at hire, and report the hire to VDOL within 10 calendar days. Employers with five or more employees must put pay in every Vermont job ad, and no employer may ask about pay history, put criminal history questions on the initial application or, outside listed jobs, use credit history. Drug tests wait for a conditional offer. Vermont has no wiretap statute, E-Verify mandate or AI hiring law.

This page is the Vermont hub: one table with every item and its official source, then a short section on each. Where we already have a full guide to an item, the section summarizes it and links there.

The Vermont hiring checklist at a glance

What must be in place before the first Vermont hire?

Two accounts and insurance. VDOL lists the tests that make an employer liable for unemployment coverage, including when it "Pays at least $1,500 in gross wages during any calendar quarter" or employs someone in each of 20 different weeks of a year. Its tax rates page puts the new employer rate for most employers at 1 percent from July 1, 2026, on the first $15,400 of each employee's wages.

Withholding is registered with the Department of Taxes through myVTax or Form BR-400, and the same account carries the Child Care Contribution: the department says "Employers are required to pay a 0.44% payroll tax on all employee wages earned in Vermont," of which up to 0.11% may be withheld from the employee.

Then workers' compensation. VDOL's fact sheet for employers says "Workers' compensation insurance is mandatory for all Vermont employers," and under 21 V.S.A. § 692 going without costs up to $100 a day for the first seven days and $150 a day after that, plus a stop-work order. The federal layer (an EIN, Form W-4 and Form I-9 by the third business day) applies on top.

Does a staffing or recruiting agency need a Vermont license?

No. Title 21 has no employment agency chapter, and as of October 2026 Vermont does not license search firms or temp agencies. The nearby license is for employee leasing: 21 V.S.A. § 1033 says "No person shall engage in the business of employee leasing in Vermont" without the Commissioner of Labor's license, at a $100 application fee and a $1,000 licensing fee, and bars running a temporary help business through the same entity. Agencies still appear in the hiring laws: the drug testing rules cover "an employer or an employment agency." See Vermont staffing agency rules.

What must a Vermont job posting include, and can you ask about pay history?

Pay, at five or more employees. Since July 1, 2025, 21 V.S.A. § 495p has required that "any advertisement of a Vermont job opening shall include the compensation or range of compensation" the employer "expects in good faith to pay." That includes a remote role that will "predominantly perform work for an office or work location that is physically located in Vermont." Commission-based ads say so instead, and tipped ads give the base wage. See the Vermont pay transparency guide.

Pay history is off limits at any size. 21 V.S.A. § 495m bars asking about "a prospective employee's current or past compensation," including bonuses and equity, and deciding whom to interview on it. Asking about salary expectations is allowed. See the Vermont salary history ban.

When can you ask about criminal history or run a credit check?

At the interview, not on the application. 21 V.S.A. § 495j says an employer "shall not request criminal history record information on its initial employee application form," but may ask "during an interview or once the prospective employee has been deemed otherwise qualified." Offense-limited questions are allowed on the form where a law disqualifies people for certain convictions. A still-eligible candidate must get a chance to explain, and each violation carries a penalty of up to $100. See Vermont's ban-the-box law and the FCRA background check process.

Credit checks are restricted too. 21 V.S.A. § 495i bars asking about or acting on "the individual's credit report or credit history" unless an exemption applies, such as a legal requirement, access to confidential financial or payroll information, financial institutions, law enforcement, or financial fiduciary duties. Even then credit cannot be the sole factor, and the employer needs written consent each time and must give its reasons in writing. Our credit check laws guide compares other states.

Can you record or transcribe a job interview in Vermont?

Yes, as a participant, but tell candidates at home. Vermont's criminal code has no wiretap or eavesdropping chapter, so federal law sets the baseline: 18 U.S.C. § 2511(2)(d) lets a person record a communication "where such person is a party to the communication." Vermont's voyeurism statute, 13 V.S.A. § 2605(d), bars recording "in any format a person without that person's knowledge and consent" in a private place "within a home or residence," which describes many video candidates. New Hampshire and Massachusetts, next door, are all-party states. See Vermont recording consent law for interviews and recording calls across state lines.

Does Vermont regulate AI in hiring?

Not as of October 2026. H.262, on electronic monitoring and "employment-related automated decision systems," and H.714, on automated employment decisions for state employees, both show the House Committee on General and Housing as their location on the Legislature's 2025-2026 bill pages, so neither was enacted. The credit and pay history rules above still bind an AI screen; see AI hiring laws by state.

Can you drug test applicants in Vermont?

Only after a conditional offer. 21 V.S.A. § 512 lets an employer or agency test an applicant only if the applicant "has been given an offer of employment conditioned on the applicant receiving a negative test result" and received written notice of the procedure and the drugs tested. Under § 514, the employer gives a written policy, uses a laboratory designated by the Department of Health, confirms positive urine screens and may not take blood. Section 513 bars random or company-wide testing unless federal law requires it, and § 519 sets a civil penalty of $500 to $2,000 plus a private right of action. See our drug testing laws guide.

Does Vermont require E-Verify?

No. As of October 2026 no Vermont statute requires E-Verify of private employers, state agencies or state contractors, so it applies only where a federal contract includes the FAR E-Verify clause or the employer opts in. Form I-9 is the baseline. See E-Verify requirements in Vermont for how we checked.

Which state withholding form does a new hire complete?

The W-4VT, if the employee chooses. The Department of Taxes' withholding page says employers should request a W-4VT from each employee in addition to the federal W-4. Its FAQs answer "Am I required to fill out the W-4VT?" with "No," and say "An employer may use the information from federal Form W-4 if a Vermont form is not submitted." Out-of-state employers need not start Vermont withholding until a remote employee has worked from Vermont for 30 days.

Which notices must a new Vermont employee get at hire?

• Sexual harassment policy. 21 V.S.A. § 495h(c)(1): "Employers shall provide individual copies of their written policies to new employees upon their being hired."
• Earned sick time. 21 V.S.A. § 483(j) requires a poster and says the employer "shall also notify an employee of the provisions of this section at the time of the employee's hiring."
• Pay frequency. Wages are due weekly under 21 V.S.A. § 342; biweekly or semimonthly pay is allowed "after giving notice to each employee."
• Drug testing notice and policy, before any test.
• Workers' compensation poster at each place of business, under 21 V.S.A. § 691.

How do you report a new hire in Vermont?

To the Department of Labor. VDOL's New Hire Reporting page says reports "must be filed within 10 days of the first day work is performed," and rehires separated for at least 60 consecutive days are reported again. Its requirements document counts 10 calendar days from "the first date services are performed for compensation," lists the employer's name, address and FEIN and the employee's name, address, Social Security number and date of hire, and says all reports are filed electronically in e-Services. A temporary agency that pays a worker's wages reports that worker once, unless a break in service requires a new W-4.

The Vermont hiring steps in order

1. Before the first hire: open the VDOL unemployment account once liable, register for withholding (the Child Care Contribution rides on it), and bind workers' compensation.
2. Posting: pay or a good-faith range in every Vermont job ad at five or more employees.
3. Application: no pay history, no criminal history on the initial form, no credit questions unless an exemption applies.
4. Interview: criminal history questions may start, with a chance to explain; tell the candidate before recording, especially one at home.
5. Conditional offer: drug test only now, with written notice, a written policy and a designated lab; background checks under the FCRA.
6. First day: Form I-9, W-4 and W-4VT, the sexual harassment policy, the earned sick time notice, and pay frequency notice if not weekly.
7. Within 10 calendar days of the first day of paid work: report the hire to VDOL in e-Services.

Hiring in more than one state? The same checklist is available for Massachusetts, New York, South Carolina, South Dakota, Utah, West Virginia, Wisconsin and Wyoming.