House Appropriations committee favors S.117 to update unemployment notices, revive short‑time compensation and tweak workers’ compensation rules

The House Appropriations Committee on Wednesday favorably reported S.117, a 21‑page bill that the Office of Legislative Council described as technical corrections to Vermont labor laws and changes to unemployment and workers’ compensation procedures.

Sophie Sedatny, of the Office of Legislative Council, told the committee “this bill came about because it was, technical corrections requested by the Department of Labor.” She said the bill bundles mostly clarifying edits and procedural changes across unemployment insurance, wage‑payment enforcement and workers’ compensation provisions.

Sedatny summarized key elements: sections 1–4, which would have created an expedited rulemaking process for the Vermont Occupational Safety and Health Administration, were deleted at the Department of Labor’s request; section 5 clarifies the commissioner’s authority to pursue employers who willfully fail to pay wages and specifies that an employee who did not receive wages would be entitled to half of any penalty awarded; section 6 sets minimum‑wage calculations to be rounded to one decimal place.

The bill allows electronic service of claims notices once the state’s new unemployment insurance modernization system is operational. Sedatny said sections 9–16 add statutory language permitting determinations and notices to be sent electronically to claimants and employers instead of only by mail. Sections 21 and 21a extend deadlines in current session law tied to the IT rollout, moving an anticipated system launch from summer 2025 to summer 2026.

Section 17 targets what Sedatny described as attempts by some employers to split or restructure businesses to reduce their contributions to the state unemployment trust fund: the text would require affected employees to be assigned to one of the successor corporate entities for contribution‑calculation purposes. Section 18 aligns Vermont’s calculation of the highest benefit cost rate with the federal method so the state can use more federal data, Sedatny said.

The bill changes how disregarded earnings are handled for part‑time workers receiving unemployment: section 19 would require rounding down to the nearest dollar, a change characterized in testimony as pro‑claimant. Section 20 would allow the state to offer the federal short‑time compensation program again once the new UI system is in place; that program, Sedatny said, was dormant as of July 2020 because it was labor intensive to administer and will be easier to run on the new digital platform.

On workers’ compensation, Sedatny said sections 22, 24 and 25 let claimants (or their attorneys) request medical case management that previously carriers could arrange on their own; section 23 requires employers to provide translation services for claimants who do not speak English fluently; and section 25 raises late‑payment penalties on average weekly wage payments (5% for the first late payment, 10% for the second, 15% for the third) and section 26 requires employers to report late payments so the Department of Labor can produce a January 2027 report on the problem’s scope.

Committee members asked about budgetary and implementation implications. A committee member asked whether pushing the IT launch to 2026 affects funds already appropriated in fiscal 2025; Sedatny and other staff said they were not aware of a direct appropriations impact. Members discussed funding sources for the short‑time compensation program; Sedatny described it as a federal program administered through the state unemployment insurance system.

The committee moved to favorably report S.117 as amended. A roll call recorded “yes” votes from Representatives Luling, Dickinson, Harris, Consent Scott, LaRoche, Anderson, Nigro, Stevens and Gakpo. The motion was recorded as carried.

The discussion before the vote included substantive staff clarifications about which provisions were technical corrections and which change policy or process; members asked for follow‑up information about IT funding and anticipated administrative savings from electronic notices. No formal amendment text beyond what Sedatny described was read into the record during the committee action.