Vermont Family and Medical Leave Insurance: What It Is and How to Participate

In 2024, Vermont joined New Hampshire as the second state to offer a voluntary paid family and medical leave (PFML) program to employers and employees. Unlike the other 15 US states (plus DC) that have passed PFML laws, employers aren’t obligated to participate in Vermont’s plan—but they can if they want to. 

Whether you run a business in Vermont or have remote employees there, it’s important to understand how the state’s optional program works. Keep reading for details on cost, eligibility, and employee benefits. 

What is the Vermont Family and Medical Leave Insurance Plan?

The Vermont Family and Medical Leave Insurance Plan (VT FMLI) is a voluntary insurance plan that gives employees six weeks of paid leave for qualifying events. Vermont employees can take paid leave to:

1. Bond with a newborn, adopted, or fostered child 

2. Recover from a personal health condition, including childbirth

3. Care for a family member with a serious health condition

4. Manage affairs when a military family member is on active duty

5. Care for a military service member

Eligible workers get 60% of their average weekly wage during leave, up to the maximum weekly benefit: $2,031.92 in 2026. 

Can any business opt into VT FMLI?

Any Vermont employer can obtain VT FMLI insurance, either through the employer program or individual program. If you have two or more employees and a physical business location in the state, you purchase a VT FMLI employer plan through The Hartford, Vermont’s chosen insurance provider. There are two leave products to pick from: 

1. Family and Medical Leave Insurance (FMLI) together, which covers bonding leave, caregiving leave, military exigency leave, and personal medical leave OR

2. Standalone Family Leave Insurance (FLI), which covers everything except personal medical leave.

If you have just one employee, or if you’re self-employed, you’ll pick a plan from the Vermont FMLI Individual Purchasing Program, which is insured by The Hartford. Annual enrollment happens in May; get a quote here.

Which employees are eligible for VT FMLI?

Any employee who works for an employer with a VT FMLI plan can take leave. If someone's employer doesn’t participate in the program, they can purchase their own individual coverage. 

What does VT FMLI cost employers?

When you sign up for a VT FMLI plan, you have the option to:

1. Cover 100% of insurance premiums for your employees

2. Split the premium cost with your employees

3. Pass the full premium cost to your employees

The Hartford will determine how much your premiums cost, taking into account the specific plan you choose, how many employees you have, and what your payroll looks like. 

What is the Family and Medical Leave Act, and how does it work with VT FMLI?

The Family and Medical Leave Act (FMLA) is a federal law dating back to 1993. FMLA requires all US employers with at least 50 employees to give them up to 12 weeks of unpaid, job-protected leave for certain life events. 

Employees can take FMLA leave to: 

• Care for and bond with a new child (this applies to newly born, adopted, and foster children) 

• Care for a family member who has a serious health condition (this applies to spouses, children, and parents) 

• Manage a serious personal health condition 

• Manage affairs when a family member is on or called to active duty (this applies to spouses, children, and parents)

Though it’s not paid, FMLA leave comes with two critical employee protections: continued health insurance during leave and job restoration after leave.

Who’s eligible for FMLA leave?

Any worker in Vermont who meets these four eligibility requirements can take FMLA leave:

1. Work for an employer that has at least 50 employees who work within a 75-mile radius

2. Need time off from work for bonding, caregiving, personal medical reasons, or military exigency

3. Have worked for their employer for at least 12 months, consecutively or non-consecutively 

4. Have over 1,250 hours of service in the 12 months before leave begins

What is Vermont’s Parental and Family Leave Act? 

Vermont has its own state law similar to FMLA, called the Vermont Parental and Family Leave Act (VPFLA). Under VPFLA, certain employers are obligated to give eligible employees up to 12 weeks of unpaid leave a year for a handful of different reasons, including bonding and caregiving.

• Employers with 10+ employees who work an average of 30 hours a week are required to provide bereavement leave, safe leave, parental leave, and qualifying exigency leave. 

• Employers with 15+ employees who work an average of 30 hours a week are required to provide family leave (which the state defines as leave taken for a serious health condition).

To qualify for bereavement, family, parental, and qualifying exigency leave, employees need to have worked for their covered employers for an average of 30 hours a week over the last 12 months. To qualify for safe leave, employees just need to have worked an average of 20 hours a week for the last six months.  

Like FMLA leave, VPFLA guarantees employees ongoing health insurance during leave and job restoration after leave. 

VT FMLI vs FMLA vs VPFLA

Can employees take VT FMLI, VPFLA, and FMLA leave?

If you’re a covered employer under FMLA or VPFLA, and you also purchased some form of VT FMLI, your eligible employees might qualify for multiple leaves. That doesn’t mean they get to take leaves one after another, though—all the leaves run at the same time. 

Let’s say you have 25 employees, making you a covered employer under VPFLA but not FMLA. You have VT FMLI and one of your employees needs to take personal medical leave. They’ll qualify for six weeks of paid leave under your insurance program and receive 60% of their usual wages each week. 

However, if they meet the eligibility requirements for VPFLA, they can take an additional six weeks of unpaid leave. And because of VPFLA protections, they’ll receive continued health insurance and job protection the entire 12 weeks they’re gone. 

How does VT FMLI work with other employer-provided benefits? 

The Hartford designed VT FMLI plans to work alongside other employer-provided benefits, like short-term disability and workers’ compensation. The FMLI and FLI plans can top up other benefits or work in conjunction with them. Either way, you’ll talk with insurance brokers from The Hartford to coordinate your benefits and create a policy that works for you and your employees. 

What are my employer responsibilities with VT FMLI?

If you opt into Vermont’s leave insurance program, you’ll end up working with The Hartford to design a plan, integrate leave insurance with other benefits, and update your workplace leave policy. You’ll have to: 

• Inform employees about your insurance plan

• Update your employee handbook

• Give employees the option to enroll or decline coverage

• Either pay insurance premiums yourself, withhold them from employee paychecks, or do a combination 

• Provide any relevant info The Hartford needs to process workers’ claims

Even if you don’t purchase VT FMLI, your employees might buy their own individual plans, which means you need to be prepared to answer questions and submit employee information if The Hartford contacts your business. 

What’s the business case for signing up for a VT FMLI plan?

Opting into Vermont’s voluntary paid leave insurance program is a no-lose situation for your business. You get the opportunity to offer your employees an essential, life-changing benefit on terms that work for you. 

Here are the advantages of VT FMLI:

• It’s flexible: You get to pick from one of two products, choose exactly how to fund the premiums, and give your employees the option to participate. 

• It helps you stand out: You can advertise your paid leave offering during recruitment and hiring to attract talent. 

• It supports employees: Your business directly benefits from employees who have the time and financial support to care for themselves and their families.

• It can raise employee retention rates: Employees with paid leave access are more likely to stick around. 

Do I have to change my employee leave policy? 

If you haven’t updated your workplace leave policy to account for VT FMLI, you should—even if you’re not enrolled in an employer plan. Take the time to explain:  

• How VT FMLI works (qualifying leave situations, leave duration, partial wage replacement, employee protections, and premium payments)

• How VT FMLI intersects with VPFLA and FMLA 

• How VT FMLI works with other employer-provided benefits in your workplace

• How and when to file a claim for leave

Vermont employer guides

For compliance information and state-specific advice, save these evergreen guides: 

• Business tax incentives in Vermont

• Hiring in Vermont

• Vermont’s retirement program

• Business grants and loans in Vermont

• Employer taxes in Vermont