Nebraska voters have passed Initiative 436, also known as the Nebraska Healthy Families and Workplaces Act, which mandates paid sick leave for most employees in the state. Effective October 1, 2025, this initiative introduces new requirements for sick leave accrual and usage, affecting all Nebraska companies that employs one or more employees.

Key Provisions of the Nebraska Healthy Families and Workplaces Act

All employees in Nebraska are entitled to accrue and use up to one hour of paid sick leave for every 30 hours worked. Employees in companies with fewer than 20 employees are entitled to accrue and use up to 40 hours of paid sick leave per year, while employees in companies with 20 or more employees are entitled to accrue and use up to 56 hours annually. This headcount includes full-time, part-time, and temporary employees. If a company has 20 or more employees on its payroll for a total of 20 or more weeks in the current or previous calendar year, it is subject to the higher sick leave requirement.

Unused paid sick leave will carry over into the following year; however, employers are not required to permit employees to use more than the maximum annual limit—40 hours for businesses with fewer than 20 employees or 56 hours for those with 20 or more employees. This means that while any unused sick leave can roll over, employers can still cap the amount of sick leave an employee may use each year based on the limit set for their business size.

However, certain workers are exempt from this initiative, including individuals working fewer than 80 hours a year in Nebraska, as well as federal, state, and county employees. Businesses with existing leave policies or collective bargaining agreements that are equal to or more generous than the minimum requirements of the initiative may continue those policies. Additionally, the initiative prohibits retaliation against employees for using their paid sick leave, including actions such as termination, suspension, demotion, or reduction in hours or pay.

Implications for Businesses

Nebraska businesses should evaluate and adjust their paid time off (“PTO”) and paid sick leave policies to comply with the new standards. Here are some specific considerations for different types of businesses:

• Businesses with existing PTO policies should review them to ensure they meet the new requirements. If a company’s policy is more generous than the initiative, no changes are necessary.

• Companies without a dedicated system for tracking sick leave will need to implement one to manage sick leave accrual and carryover accurately.

• Employers that require employees to give notice before using sick leave must provide a written policy outlining the procedures. Employers cannot deny sick leave for noncompliance with unwritten policies.
• Employers cannot require employees requesting paid sick time to find a replacement worker to cover the hours during which the employee is using paid sick time.
• Employers can request reasonable documentation for sick leave used for three or more consecutive days. However, they cannot ask for health details as a condition for granting paid sick leave.

• Violations of the initiative can result in fines up to $500.00 for the first violation and up to $5,000.00 for subsequent offenses. Employers can contest citations within 15 days, and failure to pay citations will bar them from contracting with state or local governments until settled.

• Employees who file lawsuits for violations of the initiative may be entitled to full judgment recovery, including lawsuit costs and attorney fees. Civil lawsuits must be filed within 4 years of the violation under this initiative.
• Employers must provide employees with the amount of sick time available to the employee, the amount of sick time used by the employee to date in the year, and the amount of pay the employee has received as paid sick time in, or attached to, the employee’s regular paycheck.

Employer Notice Requirement for Paid Sick Time Implementation

            Employers must give employees written notice to its employees on or before September 15, 2025, that beginning October, 1, 2025: (1) employees are entitled to paid sick time; (2) the amount of paid sick time based on business size; (3) the terms of the use of paid sick time; (4) that retaliation against employees who request or use paid sick time is prohibited; (5) that employees have the right to file suit or a complaint if paid sick time is denied in violation of Initiative 436 or if the employee is subjected to retaliatory action for requesting or using paid sick time; and (6) the contact information for the Department of Labor.

            The notice must be provided in English, and any language that is the first spoken language by at least 5% of the employer’s workforce. Employers must display a poster with the notice in a conspicuous and accessible place. If the employer does not maintain a physical workplace, the employer must provide the notice via electronic communication or a conspicuous posting on the employer’s website. 

Conclusion

Nebraska’s Initiative 436 introduces significant changes to sick leave requirements that will impact all businesses in the state. Employers should prepare for the implementation by reviewing existing policies, implementing sick leave accrual and balance tracking systems, and clear communication with employees about their rights and responsibilities surrounding paid sick leave.