Day: February 18, 2026

As lawmakers consider new workforce mandates this session, Vermont employers are facing a challenging economic context. Vermont ranks last in the nation for economic momentum and seventh for regulatory burden on the Vermont Competitiveness Dashboard. That broader picture aligns with what employers told the Vermont Chamber in our Business Climate Survey, where regulation consistently ranks among the top concerns.

Against that backdrop, the Vermont Chamber has been actively engaged at the State House this session, testifying on multiple workforce bills. Three proposals in particular highlight where legislation is gaining momentum, where policy and procedural complexity are creating headwinds, and where a proposal appears unlikely to advance this session.

Noncompete Agreements

• What the bill proposes
  The noncompete legislation would broadly prohibit noncompete agreements, while allowing limited, tightly defined exceptions. These include certain business transactions, severance agreements, and a narrow category of exempt employees, with guardrails around income thresholds, advance notice, and reasonableness standards related to time, geography, and scope.
• Vermont Chamber position
  The Vermont Chamber has emphasized that any statutory changes should align closely with existing Vermont case law, which already evaluates noncompete agreements using a reasonableness standard. In testimony this week, we noted that outside of health care, it is fair to ask what specific Vermont problem is being addressed beyond what current law already covers. At the same time, the Vermont Chamber has remained engaged throughout the process to help shape language that provides clarity and predictability, reflects how courts have historically evaluated these agreements, and results in an outcome that stakeholders across sectors can live with.
• Legislative Outlook: Gaining Momentum

This has been a longstanding priority for the committee, significant time has been invested, and the bill reflects a negotiated outcome shaped by stakeholder input. It is one of the more likely workforce bills to move this session.

Workers’ Compensation and Family and Medical Leave

• What the bill proposes
  The proposal would prohibit certain employers from counting workers’ compensation leave for a work-related injury or illness toward Vermont’s family and medical leave requirements, effectively requiring these leave systems to run sequentially rather than concurrently.
• Vermont Chamber position
  The Vermont Chamber’s testimony emphasized that workers’ compensation and family and medical leave serve different purposes and currently work together in a coordinated way. Workers’ compensation provides wage replacement and medical coverage, while family and medical leave provides job protection. Changing how these systems interact has real consequences for both employers and injured workers, particularly around job protection during recovery, return to work planning, and staffing predictability. Testimony made clear that this issue is far more complex than initially anticipated and warrants careful evaluation.
• Legislative Outlook: Facing Headwinds With only eight working days before crossover, multiple competing committee priorities, and significant technical and legal complexity involved, advancing this proposal meaningfully this session would be challenging.

Flexible Work Arrangements

• What the bill proposes
  The flexible work arrangements proposal would substantially change existing law by expanding the types of requests covered and shifting from a right-to-request framework toward a presumption that requests should be granted. It would narrow the circumstances under which an employer could deny a request, require more detailed written justifications for denial, shorten response timelines, and increase documentation and recordkeeping requirements.
• Vermont Chamber position
  The Vermont Chamber provided the only testimony on this proposal. Vermont already has one of the most comprehensive flexible working arrangements statutes in the country, and available enforcement data show very few employee complaints since the law took effect. From the Vermont Chamber’s perspective, the proposal did not identify a clear problem or evidence that the existing framework is failing employees, making it a solution in search of a problem.
• Legislative Outlook: Unlikely to Advance

The flexible work provision has been removed from the bill that is advancing and sent to the Government Operations Committee, significantly reducing the likelihood of action this session.

What happens next

The legislative session is far from over, and nothing is final until the gavel falls. Committee priorities can shift quickly, amendments can reappear, and issues that cool off one week can heat up the next. These classifications reflect the best read of where these workforce proposals stand today, based on testimony, committee focus, and the time remaining in the session. The Vermont Chamber will continue to stay engaged, track changes closely, and represent Vermont employers as these and other workforce issues evolve in the weeks ahead.