§ 384. Employment; wages

(a)(1) An employer shall not employ any employee at a rate of less than $10.96. Beginning on January 1, 2021, an employer shall not employ any employee at a rate of less than $11.75. Beginning on January 1, 2022, an employer shall not employ any employee at a rate of less than $12.55, and on each subsequent January 1, the minimum wage rate shall be increased by five percent or the percentage increase of the Consumer Price Index, CPI-U, U.S. city average, not seasonally adjusted, or successor index, as calculated by the U.S. Department of Labor or successor agency for the 12 months preceding the previous September 1, whichever is smaller, but in no event shall the minimum wage be decreased. The minimum wage shall be rounded off to the nearest $0.01.

(2) An employer in the hotel, motel, tourist place, and restaurant industry shall not employ a service or tipped employee at a basic wage rate less than one-half the minimum wage. As used in this subsection, “a service or tipped employee” means an employee of a hotel, motel, tourist place, or restaurant who customarily and regularly receives more than $120.00 per month in tips for direct and personal customer service.

(3) If the minimum wage rate established by the U.S. government is greater than the rate established for Vermont for any year, the minimum wage rate for that year shall be the rate established by the U.S. government.

(b) Notwithstanding subsection (a) of this section, an employer shall not pay an employee less than one and one-half times the regular wage rate for any work done by the employee in excess of 40 hours during a workweek. However, this subsection shall not apply to:

(1) Employees of any retail or service establishment. A “retail or service establishment” means an establishment 75 percent of whose annual volume of sales of goods or services, or of both, is not for resale and is recognized as retail sales or services in the particular industry.

(2) Employees of an establishment that is an amusement or recreational establishment, if:

(A) it does not operate for more than seven months in any calendar year; or

(B) during the preceding calendar year its average receipts for any six months of that year were not more than one-third of its average receipts for the other six months of the year.

(3) Employees of an establishment that is a hotel, motel, or restaurant.

(4) Employees of hospitals, public health centers, nursing homes, maternity homes, therapeutic community residences, and residential care homes as those terms are defined in Title 18, provided:

(A) the employer pays the employee on a biweekly basis; and

(B) the employer files an election to be governed by this section with the Commissioner; and

(C) the employee receives not less than one and one-half times the regular wage rate for any work done by the employee:

(i) in excess of eight hours for any workday; or

(ii) in excess of 80 hours for any biweekly period.

(5) Those employees of a business engaged in the transportation of persons or property to whom the overtime provisions of the federal Fair Labor Standards Act do not apply, but shall apply to all other employees of such businesses.

(6) Those employees of a political subdivision of this State.

(7) State employees who are covered by the federal Fair Labor Standards Act.

(c) However, an employer may deduct from the rates required in subsections (a) and (b) of this section the amounts for board, lodging, apparel, rent, or utilities paid or furnished or other items or services or such other conditions or circumstances as may be usual in a particular employer-employee relationship, including gratuities as determined by the wage order made under this subchapter.

(d) For the purposes of earned sick time, an employer shall comply with the provisions required under subchapter 4B of this chapter. (Amended 1959, No. 32, eff. Sept. 1, 1959; 1965, No. 35, § 1, eff. Oct. 1, 1965; 1967, No. 177, § 2, eff. April 17, 1967; 1969, No. 67, §§ 1, 2, eff. April 17, 1969; 1969, No. 190 (Adj. Sess.); 1971, No. 203 (Adj. Sess.); 1973, No. 265 (Adj. Sess.), eff. April 16, 1974; 1977, No. 244 (Adj. Sess.), § 8, eff. May 1, 1978; 1985, No. 80, § 1; 1987, No. 181 (Adj. Sess.); 1989, No. 131 (Adj. Sess.), § 1, eff. March 29, 1990; 1993, No. 227 (Adj. Sess.), §§ 33, 35; 1995, No. 150 (Adj. Sess.), § 1, eff. Jan. 1, 1997; 1997, No. 4, § 1; 1999, No. 21, § 1, eff. May 13, 1999; 1999, No. 119 (Adj. Sess.), § 7, eff. May 18, 2000; 2003, No. 67, § 25a; 2005, No. 82, § 1; 2007, No. 78, § 1; 2009, No. 54, § 31, eff. June 1, 2009; 2013, No. 176 (Adj. Sess.), § 1, eff. Jan. 1, 2015; 2015, No. 69 (Adj. Sess.), § 3, eff. Jan. 1, 2017; 2019, No. 86 (Adj. Sess.), § 1.)