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Human Resources seeks $1.6M for classification/compensation overhaul and reports paid‑leave rollout
Summary
Department of Human Resources Commissioner Beth Fastyge told the Appropriations Committee the DHR FY26 increase is primarily personnel-driven, highlighted the multi‑year enterprise HR/payroll replacement (VTHR) and proposed $1,575,000 for a new classification and compensation project to modernize the state’s decades‑old system.
Beth Fastyge, commissioner of the Vermont Department of Human Resources, told the Senate Appropriations Committee on Feb. 6 that DHR’s FY26 budget reflects personnel costs alongside major multi‑year modernization initiatives, including a proposed new classification and compensation project.
Fastyge said the department’s FY26 increase of about 9% is driven by salaries and benefits and a lower reliance on vacancy savings as positions added in recent years are filled. “We have 6 exempt staff and 104 classified,” she said, and noted DHR is implementing the paid family medical leave insurance program in three phases: state employees (effective July 1, 2023), employers (opened last summer) and individuals (planned this summer).
The nut graf: DHR’s top near‑term initiatives are the enterprise resource planning (ERP) rollout for VTHR (the HR/payroll replacement) and a proposed $1,575,000 appropriation for a multi‑year classification and compensation project designed to replace a decades‑old point/level system and reduce the volume of ad‑hoc reclassification requests.
Fastyge described the consultant project as a multi‑phased effort to develop a modern classification system, align compensation methodology and reduce the current inventory of about 1,800 job classifications (she said the department hopes to cut that total in half). She emphasized that any compensation changes would be subject to collective bargaining and that implementation could be phased to manage budgetary impact: “Sometimes they’re implemented over time because depending on what the budgetary impact is, you might not be able to absorb that in 1 year,” she said.
Committee members asked whether reclassifications would require bargaining and whether employees’ pay could be reduced under a new system; Fastyge said reductions would not be a policy goal and that increases would require negotiation and phased budgeting.
DHR also reported progress on the VTHR implementation and that the paid family medical leave vendor, the Hartford, has sold coverage to about 52 employers so far and individual take‑up is in the low hundreds among participating firms’ employees. The department said it expects the VTHR rollout to be a two‑year implementation and that the classification/compensation consulting contract would likely run 18–24 months with subsequent bargaining steps.
No committee action was taken during the presentation; senators requested follow‑up materials on projected classification cost scenarios and workforce statistics.
