Stops vapor, not standing water
People hear vapor barrier and picture something that keeps a slab from flooding, and that is not what it does. Concrete is porous. Even after it cures, water vapor in the ground underneath can move up through it slowly, the same way damp comes through a basement wall. A vapor barrier blocks that upward drift of moisture. It is not waterproofing in the sense of holding back standing water under pressure, which is a different problem with different materials. On a slab, the moisture it is stopping is invisible: it shows up later as a haze on the surface or a coating that fails, not as a puddle.
Where it sits in the build
The sheeting goes down over the compacted stone base, before the slab is poured, not after. Seams get lapped and it runs out to the edge of the forms so the whole floor ends up sitting on it rather than half on plastic and half on bare stone. Reinforcement and the pour itself go on top of it as normal. Because it sits below everything else, it is a decision that has to be made before the pour, not something that can be added afterward without tearing out the floor.
When it earns its keep and when it gets skipped
An attached garage, a heated shop, or any floor that is going to get an epoxy coating or carry anything moisture sensitive is where a vapor barrier matters most, because trapped moisture is what lifts a coating or shows up as a damp patch on a finished floor. On an open equipment shed with a bare floor and nothing stored that minds a little dampness, some people skip it. Neither choice is automatically wrong. It comes down to what the floor is for, and it is worth deciding at the estimate rather than after the stone is already down.