Nebraska Paid Sick Time Law: 11 Employee Threshold, 1 Hour per 30 Worked, 40 or 56 Hour Caps and Exemptions
Nebraska Paid Sick Time Law: 11 Employee Threshold, 1 Hour per 30 Worked, 40 or 56 Hour Caps and Exemptions
Nebraska's paid sick leave law is part of the Nebraska Healthy Families and Workplaces Act (Initiative Law 2024, No. 436, as amended by LB 415 of 2025). The act took effect October 1, 2025, and the Nebraska Department of Labor (NDOL) enforces it. This guide covers what matters most to a business owner: who has to comply, how fast employees earn sick time, how much they can build up, and what notice you must give. It is informational only and is not legal or tax advice.
Who has to comply: the 11 employee threshold
The act applies to employers with 11 or more employees. The count is not a single-day headcount. It includes every person who worked at least 80 hours in Nebraska during the calendar year. A part-time worker who logged 120 Nebraska hours counts toward your total for that year, even if that person has since left the company.
Here is how that plays out. Suppose you run a shop in Lincoln with 8 full-time employees and 3 part-time employees who each worked 120 hours in Nebraska during the year. Your count is 11, so the act applies to you. Count everyone who meets the 80 hour test, not only the people on the payroll today.
Who is exempt
The following workers are not covered:
- Individual owner-operators
- Independent contractors
- People who work fewer than 80 hours a year in Nebraska
- Seasonal or temporary agricultural workers
- Railroad employees covered by the Railroad Unemployment Insurance Act (RUIA)
- Workers under 16 years old
Exemptions turn on the facts of the working relationship, not on the label in your paperwork. If a worker you call a contractor keeps set hours, uses your equipment and reports to a supervisor, review that classification with an employment attorney before you rely on the exemption. Misclassification is one of the easiest ways to end up out of compliance without realizing it.
How employees earn sick time: 1 hour for every 30 hours worked
Covered employees accrue 1 hour of paid sick time for every 30 hours worked. Accrual begins after 80 hours of consecutive employment. If an employee has gaps in service, confirm with NDOL how consecutive employment is measured before you start the clock.
The math is simple. An employee who works 1,200 hours in a year earns 40 hours. An employee who works 1,680 hours earns 56 hours. Accrual stops at the annual cap, so hours worked beyond the cap do not add to the balance.
The annual caps: 40 hours or 56 hours
The cap depends on how many employees you have:
| Employees counted | Coverage | Annual accrual cap |
|---|---|---|
| Under 11 | Act does not apply | Not applicable |
| 11 to 19 | Covered | 40 hours per year |
| 20 or more | Covered | 56 hours per year |
Because the cap is tied to your employee count, the number can change as you grow. Recheck the count each calendar year so your tracking and policy keep up with your actual headcount.
Carryover, front-loading and payout
Unused sick time carries over from year to year, and the act sets no maximum balance. Unused hours do not disappear at the end of the year.
Payout is the exception. Under the act as NDOL describes it, an employer may pay out unused time when the employee starts the new year at the required minimum, in place of carrying the time over. Because payout affects your payroll records and your balance tracking, confirm the mechanics with NDOL before you adopt a written policy.
Front-loading is allowed. You can grant the full annual amount at the start of the year instead of letting it accrue, as long as the front-loaded amount is at least the required amount: 40 hours for employers with 11 to 19 employees, or 56 hours for employers with 20 or more. Front-loading can simplify administration, but you still need to track any hours used during the year.
What employees are paid for sick time
Sick time is paid at the employee's regular rate of pay. Commission and piece-rate workers are paid at the average weekly rate, as the act cross-references in section 48-126, divided by 40 hours. The calculation is straightforward once you have the average weekly rate, but the rate itself depends on your pay records. Confirm the method for your pay structure with NDOL, and document the calculation so you can show how each hourly figure was reached.
Notice and poster requirements
You must give each covered employee written notice of the act at hire. You must also display a workplace poster. NDOL provides a free model poster, so you can meet the posting requirement without paying for a custom design. Keep a signed or dated copy of each notice in the employee's file so you can prove it was delivered.
Worked examples
These examples show how the rules fit together. They are illustrations, not rulings, so check your own facts with NDOL.
- Warehouse worker at a 15 employee company. The worker is scheduled 35 hours a week, or about 1,800 hours a year. At 1 hour per 30 hours worked, the accrual would be 60 hours, but the cap for an employer with 11 to 19 employees is 40 hours. The balance stops at 40.
- Part-time worker at a 24 employee company. The worker is scheduled 20 hours a week, or about 1,000 hours a year. The accrual is roughly 33 hours, which is below the 56 hour cap, so the full accrual applies.
- Commission salesperson in Omaha. If the average weekly rate is $1,200, the sick-time hourly rate is $30 ($1,200 divided by 40). The same method applies to piece-rate pay.
- Seasonal worker with 70 Nebraska hours. A worker who works fewer than 80 hours a year in Nebraska is exempt from the act and does not accrue sick time under it.
Employer checklist
- Count employees for the calendar year, including each person who worked at least 80 hours in Nebraska.
- Set the annual cap at 40 hours (11 to 19 employees) or 56 hours (20 or more).
- Track hours worked, accrual and balances for every covered employee, including part-time staff.
- Give written notice at hire and post the NDOL model poster.
- Choose a carryover, front-loading or payout approach and document it in writing.
- Pay sick time at the regular rate, and calculate commission or piece-rate pay using the average weekly rate divided by 40 hours.
- Keep time and balance records. Confirm the required retention period with NDOL.
Related registrations for employers
Paid sick leave is one part of the employer picture. Nebraska has no general state business license and no county business license. Registration follows your activity. If you have employees, you need an income tax withholding certificate from the Nebraska Department of Revenue. You also need unemployment tax registration through the Nebraska Department of Labor. Your city or county may separately require zoning approval, local taxes or occupational licenses for certain trades, so check with the local government where you operate.
Common questions
Does the act apply if I have 10 employees?
Not under the 11 employee threshold, provided your count stays below 11 under the calendar-year rule. Remember that the count includes everyone who worked at least 80 hours in Nebraska during the year, not only the staff on payroll today.
Does unused sick time expire?
Under the carryover rule, it does not. The act sets no maximum balance on carried-over time, so employees keep what they have earned unless you pay it out under the rules described above.
Can I give employees their full year up front?
Yes, through front-loading, as long as the amount is at least the required 40 or 56 hours depending on your employee count.
Do part-time employees earn sick time?
Yes, if they are not exempt. Part-time status does not remove coverage. An employee who works fewer than 80 hours a year in Nebraska is exempt, however.
Items to confirm with NDOL
This guide summarizes the core rules. Confirm these points with the Nebraska Department of Labor before you finalize your policy: how the 80 hour accrual start is measured when service has breaks, the exact payout mechanics, the commission and piece-rate calculation for your pay plan, the permitted uses and documentation rules for sick time, and the record retention period. NDOL's FAQ is the starting point, and you should check its current version because guidance can be updated.
Next steps
Start by counting your employees for the calendar year and setting up tracking that records hours worked, accrual and balances. Then give written notice at hire and post the NDOL poster. Before you finalize payout, commission or piece-rate calculations, or the classification of any contractor, get the details confirmed in writing.
Disclaimer: This article is informational content, not legal, tax or employment advice. Laws, agency guidance and enforcement practices change. Speak with a qualified Nebraska employment attorney or CPA about your specific situation, especially if you have workers in multiple states, unusual pay plans or a classification question.