House Commerce committee reviews S.117 labor bill: expedited OSHA rulemaking, layoff notices, UI and workers’‑comp changes

Senator Tom Chittenden, sponsor of S.117, and Office of Legislative Council staff briefed the House Committee on Commerce and Economic Development on April 3 about a broad labor bill that would: allow expedited adoption of federal OSHA rules by the Vermont Department of Labor, change layoff‑notice thresholds, add electronic communications options for unemployment insurance, restart a short‑term compensation program after a systems upgrade, clarify unpaid‑wage penalties and minimum‑wage rounding, and incorporate four workers’‑compensation provisions from S.125.

The bill matters because it affects how Vermont synchronizes workplace safety rules with federal OSHA, how employers must notify the state and workers about plant closings, and how unemployment and workers’‑comp systems will operate as the Department of Labor modernizes its IT systems.

Expedited OSHA rulemaking and safeguards

Sen. Tom Chittenden said sections 1–4 would let the Vermont Department of Labor adopt federal Occupational Safety and Health Administration (OSHA) rules more seamlessly. "This bill is mostly technical directions from the administration," he told the committee, adding the change is intended to help VOSHA manage a "very small staff." Chittenden said the state agreed in the 1970s, when it became a state plan, to adopt federal OSHA standards and that the proposed process would not prevent Vermont from adopting stricter standards.

Office of Legislative Council attorney Sophie Sedatny explained the expedited process applies only when Vermont is adopting a federal rule "wholesale" (a copy‑and‑paste adoption). Under the proposal the department would: post the proposed rule for at least 30 days, provide 30 days for public comment, notify interested parties, retain documentation for one year and file the adoption with the Secretary of State. Sedatny said the expedited process would automatically sunset after three years unless the Legislature acts; "this is a 3 year window in which to see how this works," she said. Committee members asked that notice to committee chairs (so chairs can sign up to track rulemaking) be added to the language.

The committee discussed safeguards: anyone could demand full traditional rulemaking if 25 or more people asked for the regular process, and the expedited route would not apply when Vermont proposes rules that are more protective than the federal standard.

Layoff notices: who is covered and when

The bill clarifies a covered employer is any employer with at least 50 employees in total, not just 50 in Vermont, and lowers the employee‑impact trigger for notice from 50 affected Vermonters to 20. Sophie Sedatny said that change "clarifies that a covered employer ... is 50 or more full time employees in total" and that the 20‑person threshold applies to the number of Vermont employees affected. The provision is intended to give the Department of Labor time to mobilize reemployment services before large layoffs appear in the news.

Wage and hour changes

S.117 modifies the unpaid‑wages enforcement language so that when unpaid wages are found to be willfully withheld, the Department of Labor “shall provide” (rather than “may” provide) that the employer is liable for an additional penalty up to twice the unpaid wages; one half of any additional amount recovered would go to the employee and one half would be retained by the Department of Labor. The bill also clarifies the minimum‑wage CPI calculation will be rounded to one decimal place, per a department request, and removes a dated statutory authority that allowed the labor commissioner to recommend a subminimum wage for people with disabilities (a relic tied to federal 14(c) certificates). Sedatny noted Vermont law already bars paying a person with a disability less for the same or similar work in many circumstances.

Unemployment insurance and short‑term compensation

S.117 adds an option for claimants and employers to receive determinations and notices electronically rather than only by mail. Sedatny said the change is optional: "this would be optional for people, so it wouldn't be required to be done electronically." The bill also reactivates a short‑term compensation program (dormant since July 2020) once the Department’s upgraded unemployment insurance system is deployed; Sedatny said implementation of the upgraded system has been moved to July 1, 2026, and the department hopes to start notifying businesses about new capabilities by late May of next year.

Workers’ compensation provisions taken from S.125

The committee agreed to incorporate four workers’‑compensation sections from S.125 into S.117. Those sections would: (1) add a statutory definition for "medical case management" (drawn from current workers’‑comp rules); (2) allow injured claimants, not just insurers, to request preauthorization for medical case‑management services; (3) require carriers (or employers acting as carriers) to provide translation services where a claimant does not speak English fluently; and (4) strengthen penalties for late benefit payments through an escalating schedule that could reach 15% for repeated late payments.

Former Senate Economic Development chair Sen. Kesha Ram Hinsdale urged the House committee to view the workers’‑comp changes as part of broader workforce policy and emphasized the policy history: "we have a workers' compensation system for about a century in Vermont ... it is essentially a grand bargain," she said. Hinsdale noted testimony that an attorney had identified about 60 clients in recent years who experienced late payments, which prompted lawmakers to raise penalties to encourage timely payments.

Committee direction and next steps

Committee members instructed Office of Legislative Council staff to move the four workers’‑comp sections into S.117 and to refer S.125 to the House General Committee for the remaining language. No formal roll‑call votes were recorded in the hearing. Several sections that affect revenues or rely on the department’s IT upgrade (notably the short‑term compensation restart and certain unemployment‑insurance provisions) were noted as reasons portions of the bill will go through the Appropriations Committee.

Ending

Committee members said Department of Labor staff would return to discuss implementation details — including the electronic notice option, the short‑term compensation program and late‑payment data — in a later session after floor activity. The committee did not take a final vote on S.117 during the April 3 hearing.