It is oddly worded, isn't it? On first blush, I thought it might be some attempt to institute gradual emancipation but Vermont corrected the first census and insisted that it had no slaves at all, where if they ended slavery gradually you would expect many for many years after the enactment. (New Jersey still had some slaves in 1860, left over from its gradual emancipation starting in 1804.) That doesn't mean they actually had none -you can get away with a lot on the frontier- but there's no real reason for them to have wanted to pull a con over all of sixteen people. The most plausible explanation there is human error on the census.

So I did some digging. The Vermont courts believed from that it was an absolute ban on slavery:

our State Constitution is express, no inhabitant of the State can hold a slave; ... when the master becomes an inhabitant of this State, his bill of sale ceases to operate here."

This case concerned an enslaved woman brought into the state in July of 1783, at which point the jurisdiction had no law regarding slavery either way except for the constitution. The 1777 constitution was it and it was enough and understood as such by regular Vermonters at the time. Come 1786, they pass a law to prohibit the sale and transit of slaves through the state. Neither of those would square with some kind of double-secret gradual emancipation plan, but both fit for a state that intended to have no slavery whatsoever. Their legislators say so themselves in the latter law:

the idea of slavery is expressly and totally exploded from our free government.

And whereas, instances have happened of the former owners of negro slaves in this commonwealth, making sale of such persons as slaves, notwithstanding their being liberated by the Constitution; and attempts have been made to transport such person to foreign parts, in open violation of the laws of the land

In other words, they don't legally have slaves but enslavers try to keep them anyway and this is enough of a problem to legislate against. There's nothing here about age; it's just no slavery for anyone, period.

What's that passage all about, then?

Vermont wanted to outlaw slavery. It did not want to outlaw apprenticeship contracts, indentured servitude, and the like. These are forms of unfree labor, but considerably short of slavery and were not as big a problem to whites of the era as they would eventually become around the turn of the century.

Vermont considers apprenticeship and service in the text and specifies that they can only arise from consent. A minor -or a minor's father, in most cases- can contract a son out as an apprentice to be housed at their master's expense and work for them in exchange for being trained in a trade, to age out at a set time and under agreed-upon conditions. Likewise a domestic servant -a more likely situation for women, because of patriarchy- could be bound by mutual agreement to a yearlong (or longer) contract to work for room & board and a little cash on the side maybe. These were all traditional forms of arranging labor that go back at least as far as Tudor England and carried over to British North America.

Sources

The First Emancipation: The Abolition of Slavery in the North by Arthur Zilversmit

In Re Vermont Constitution of 1777, as regards its adoption, and its declaration forbidding slavery; and the subsequent existence of slavery within the territory of the sovereign state. by John H. Watson in Proceedings of the Vermont Historical Society, 1919-1920 (My quotes are from this.)

I read it as saying the opposite. No child can be put into service until they are 18 or 21, unless it is to pay a debt. Once they are 18 or 21 they can agree to sell themselves as an indentured servant, but can't be forced to serve another against their will.