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Starting January 1, 2025, Vermont’s minimum wage will increase to $14.01 per hour from $13.67 per hour as announced by the Vermont Department of Labor. Similarly, tipped employees will also see a raise in their minimum wages from $6.84 to $7.01 per hour.
According to state law, Vermont adjusts its minimum wages annually, including the tipped minimum wage. Employers are permitted to pay tipped employees a lower wage if their tips bring their total earnings above the standard minimum wage.
These rates are effective from January 1, 2025, and will continue to be adjusted annually in accordance with the Consumer Price Index or a maximum 5% increase, whichever is smaller.
Employees can contact the Department of Labor’s Wage and Hour Unit at Labor.Vermont.gov/Rights-and-Wages if they feel they are not being paid fairly.
Minimum Wages in Vermont Cities
Here is a table detailing the minimum wage and tipped minimum wage rates observed across all cities of Vermont.
| City | Non-tipped Employees | Tipped Employees |
|---|---|---|
| Burlington | $14.01 per hour | $7.01 per hour |
| South Burlington | $14.01 per hour | $7.01 per hour |
| Rutland | $14.01 per hour | $7.01 per hour |
| Barre | $14.01 per hour | $7.01 per hour |
| Montpelier | $14.01 per hour | $7.01 per hour |
| Winooski | $14.01 per hour | $7.01 per hour |
| St. Albans | $14.01 per hour | $7.01 per hour |
| Newport | $14.01 per hour | $7.01 per hour |
| Vergennes | $14.01 per hour | $7.01 per hour |
| St. Johnsbury | $14.01 per hour | $7.01 per hour |
| Springfield | $14.01 per hour | $7.01 per hour |
| Middlebury | $14.01 per hour | $7.01 per hour |
| Battleboro | $14.01 per hour | $7.01 per hour |
| Williston | $14.01 per hour | $7.01 per hour |
| Colchester | $14.01 per hour | $7.01 per hour |
| Essex Junction | $14.01 per hour | $7.01 per hour |
| Hartford | $14.01 per hour | $7.01 per hour |
| Bennington | $14.01 per hour | $7.01 per hour |
| Rockingham | $14.01 per hour | $7.01 per hour |
| Milton | $14.01 per hour | $7.01 per hour |
| Manchester | $14.01 per hour | $7.0114.01 per hour |
| Northfield | $13.67 per hour | $7.01 per hour |
| Morristown | $14.01 per hour | $7.01 per hour |
| Shelburne | $14.01 per hour | $7.0114.01 per hour |
| Waterbury | $13.67 per hour | $7.01 per hour |
| Castleton | $14.01 per hour | $7.01 per hour |
| Fairfax | $14.01 per hour | $7.01 per hour |
| Lyndon | $14.01 per hour | $7.01 per hour |
| Stowe | $14.01 per hour | $7.01 per hour |
| Randolph | $14.01per hour | $7.01 per hour |
| Richmond | $14.01 per hour | $7.01 per hour |
| Northfield | $14.01 per hour | $7.01 per hour |
Threshold For Exempt Employees
The salaries of Vermont’s elected officers, including the Governor and other top officials, are defined in 32 VSA § 1003(a), and any adjustments require legislative approval. Meanwhile, the base salaries for agency secretaries, commissioners, and some organization heads are defined in 32 VSA § 1003(b). The maximum salary range for these positions is 50% above the base pay. Furthermore, salary adjustments cannot exceed the average total range and require the Governor’s approval for any salary increase or bonus.
Other exempt employees, such as deputies and executive assistants, are not covered by the state’s minimum wage pay plan. They need pre-approval for hiring ranges and any salary increases, with final decisions made by the Secretary of Administration. Lastly, some exempt employees are covered by unique pay plans as defined in 32 VSA § 1020(c), with established salary ranges and guidelines.
Historical Data of Vermont Minimum Wages
The federal minimum wage in Vermont was first set at $0.25 per hour, which came into effect on October 24, 1938. Today, the federal minimum wage is $7.25 per hour. Vermont introduced its own minimum wage in 1959, owing to Act 32, and paid employees $1.00 per hour.
From 1959 to 2016, the state’s minimum wage rates increased by an average of 4.6% per year. However, when adjusted for inflation using the Consumer Price Index (CPI), the wage rates increased by an average of 0.8% per year.
Here is a table of all the historical changes in the Minimum Wage Rates of Vermont:
| Time Period | Year | Minimum Wage (in $) |
|---|---|---|
| 1968 to 1981 | 1968 | 1.40 |
| 1970 | 1.60 | |
| 1972 | 1.60 | |
| 1976 | 2.30 | |
| 1988 to 1998 | 1988 | 3.55 |
| 1991 | 3.85 | |
| 1992 | 4.25 | |
| 1994 | 4.25 | |
| 1996 | 4.75 | |
| 1997 | 5.00 | |
| 1998 | 5.25 | |
| 2000 to 2006 | 2000 | 5.75 |
| 2001 | 6.25 | |
| 2002 | 6.25 | |
| 2003 | 6.25 | |
| 2004 | 6.75 | |
| 2005 | 7.00 | |
| 2006 | 7.25 | |
| 2007 to 2013 | 2007 | 7.53 |
| 2008 | 7.68 | |
| 2009 | 8.06 | |
| 2010 | 8.06 | |
| 2011 | 8.15 | |
| 2012 | 8.46 | |
| 2013 | 8.60 | |
| 2014 to 2019 | 2014 | 8.73 |
| 2015 | 9.15 | |
| 2016 | 9.60 | |
| 2017 | 10.00 | |
| 2018 | 10.50 | |
| 2019 | 10.96 | |
| 2020 to 2024 | 2020 | 10.96 |
| 2021 | 11.75 | |
| 2022 | 12.55 | |
| 2023 | 13.18 | |
| 2024 | 13.18 |
Source: https://www.dol.gov/agencies/whd/state/minimum-wage/history
Exemptions In Minimum Wages of Vermont
The current federal and state laws regarding minimum wage rates and overtime pay are quite complex. They also list various exemptions and conditions based on an employee’s work or their category classification. In a dispute regarding minimum wages between state and federal laws, the higher standard prevails.
Current Minimum Wage Law and Exemptions:
The federal minimum wage, as defined under the Fair Labor Standards Act, is $7.25 per hour. Meanwhile, Vermont’s minimum wage is $14.01 per hour. Generally, if an employee is exempt from Vermont’s minimum wage, they are paid as per federal laws. The table below details various exemptions and the applicable minimum wage rates.
| Worker Category | Federal Exemption | State Exemption | Minimum Wage (in $) |
|---|---|---|---|
| Farmworkers | No | Yes | 7.25 |
| Taxicab Drivers | No | Yes | 7.25 |
| Newspaper Deliverers | No | Yes | 7.25 |
| Publicly Supported Nonprofit Employees | No | Yes | 7.25 |
| Domestic Service Workers in a Private Home | No | Yes | 7.25 |
| Tipped Service Workers | Yes | Yes | 6.28 |
| Federal Government Employees | No | Yes | 15.00 |
| Youth and High School Students | Yes | Yes | 4.25 or 7.25 |
| Outside Salespersons | No | Yes | 7.25 |
| Professional/Salaried | Yes | Yes | N/A |
Note: The table excludes some federal exemptions that are considered irrelevant under the state minimum wage laws.
Current Overtime Pay Law and Exemptions:
Both federal and state laws mandate that employers pay 1.5 times the minimum wage rate to employees for hours worked beyond 40 hours per week. However, there are exemptions to these overtime requirements. These are mentioned in the table below.
| Worker Category | Federal Exemption | State Exemption | Is Overtime Owed? |
|---|---|---|---|
| Farmworkers | Yes | Yes | No |
| Retail and Service Employees | No | Yes | Yes |
| Seasonal Amusement Park and Recreation Establishment Employees | Yes | Yes | No |
| Hotel, Motel, and Restaurant Employees | No | Yes | Yes |
| Vermont Local Government Employees | No | Yes | Yes |
| Certain Employees in the Healthcare Sector | No | Yes | Yes |
| Transportation Employees | Yes | Yes | No |
| Professional/Salaried Employees | Yes | Yes | No |
Note: The table excludes federal exemptions made ineffective by Vermont’s overtime law. Some of these exemptions have additional complicated details. Refer to the Wages and Hour Division for complete information.
Minimum Wage Eligibility and Exemptions:
All employers who employ two more employees need to pay minimum wages. However, there are some exemptions to this rule. These include,
- Full-time high school students
- Federal employee
- Newspaper delivery people and taxi drivers
- Agricultural workers and domestic workers in private homes
- Outside salespeople
- Employees of certain non-profit organizations, excluding nurses’ aides and laundry workers
While full-time high school students fall in Vermont’s exempt category, they are paid minimum wages under federal law. If the federal minimum wage rates exceed that of Vermont’s, the state tries to match the federal rate, effective the same day.
