- Transparency is trending. Vermont joined 12 other U.S. states plus the District of Columbia to have signed a pass transparency bill into law.
- Law covers many on-site and remote workers. Vermont’s law applies to positions physically located in the state and to remote positions in which work will be predominantly performed for a workplace located in the state.
- Ramp up the action plan. While the law takes effect on July 1, 2025, employers in the state should begin taking steps toward eventual compliance.
Vermont Gov. Phil Scott recently signed H.704, which requires pay transparency in job postings and advertisements. Effective July 1, 2025, employers with at least five employees must include the compensation or range of compensation in any “Vermont job opening” advertisement.
“Range of compensation” is defined in the legislation as the good-faith expectation of the position’s minimum and maximum annual salary or hourly wage range. “Advertisement” is defined as written notice, in any format, of a specific job opening made available to potential applicants.
With Vermont’s law passage, 13 U.S. states (plus the District of Columbia) have now signed a pay transparency bill into law. Others include California, Colorado, Connecticut, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, Nevada, New York, Rhode Island and Washington. Those listed in bold passed their laws in 2024. Like Vermont, the laws in Illinois and Minnesota go live in 2025.
The Vermont law applies to:
- Positions physically located in the state, and
- Remote positions in which work will be predominantly performed for a workplace physically located in the state.
In addition, the law applies to positions that are:
- Open to internal or external candidates, or both, and
- Positions into which current employees can transfer or be promoted.
With employer applicability starting at five employees, the law will not require so-called “micro-businesses” to post wage ranges. According to Megan Sullivan, the vice president of government affairs for the Vermont Chamber of Commerce, that is pertinent since such small businesses don’t necessarily have the HR department or resources to determine appropriate wage ranges.
The state’s Office of the Attorney General will publish guidance with additional information about the law on or before Jan. 1, 2025.
While the law won’t be effective for another year, legal experts say employers with personnel or operations in Vermont should start taking steps to ensure eventual compliance.
In a post on its website, law firm Foley & Lardner LLP stated such action plans should include:
- Determining how disclosure requirements will be implemented in job postings and advertisements;
- Considering implementation of an internal pay audit, which will likely allow employers to better understand potential pay discrepancies and alert them to any suggestion of disparate impact; and
- Training those responsible for drafting and/or posting job advertisements, including third-party vendors.
Editor’s Note: Additional Content
For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics:
