Nebraska’s current minimum wage is $10.00. NE Statute 48-1203
For the next several years, the Nebraska minimum wage will increase as follows:
- January 1, 2024 – $12.00
- January 1, 2025 – $13.50
- January 1, 2026 – $15.00
Beginning January 1, 2027, Nebraska will increase its minimum wage each year based on the cost-of-living increase. The cost-of-living increase that will be used to determine future minimum wage increase will be measured by the percentage increase, if any, relative to August from the previous year to the level of the year immediate preceding the year in which the minimum wage increase will apply. The cost-of-living will be based on consumer price index published by the United States Department of Labor (US DOL) for all urban consumers (CPI-U) for the Midwest Region or its successor index.
The minimum wage determinations and increase based on cost-of-living increases will be:
- rounded up to the nearest multiple of five cents ($0.05)
- published by the Nebraska Department of Labor no later than October 15 of the year prior to the year the minimum wage increase will apply
Nebraska minimum wage laws do not apply to employers with fewer than four (4) employees. NE Statute 48-1202
Nebraska employers must also comply with federal minimum wage laws, which currently set the federal minimum wage at $7.25. For more information, see FLSA: Minimum Wage. If an employer chooses to pay employees minimum wage, the employer must pay those employees in accordance with the minimum wage law, either federal or state, that results in the employees being paid the higher wage.
Nebraska state law does not have laws regarding overtime pay. Federal law requires employers to pay employees one and a half their regular rate of pay if they work more than 40 hours per workweek. See FLSA: Overtime for more information regarding overtime hours, overtime wage rate requirements, and employees who may meet an overtime exemption.
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Tip Minimum Wage
Nebraska’s minimum wage for tipped employees is $2.13.
Employers may pay the tipped minimum wage to individuals who are compensated in part by gratuities, such as waitresses, waiters, bellhops, and porters.
If an employer chooses to pay employees the tipped minimum wage, they must also ensure the employees are paid the standard minimum wage when tipped wages are combined with tips received.
If employees are not paid the standard minimum wage when tipped wages are combined with tips received, the employer must make up the difference. The employer carries the burden to prove an employee is compensated by way of gratuities. NE Statute 48-1203(2)
Tip Pooling and Sharing
Nebraska minimum wage laws do not address whether an employer may require employees to participate in a tip pooling or tip-sharing arrangement.
Because most employers and employees in Nebraska are subject to the federal Fair Labor Standards Act, the standards set forth in that law related to tip/gratuity pooling provide additional guidance.
Employees with Disabilities
Nebraska law exempts employees with physical or mental disabilities from its minimum wage requirements if they receive federal, state, county, or local aid or welfare, whether directly or indirectly, and they work in a rehabilitation program.
Such employees may be paid a subminimum wage rate at a level appropriate to their health, efficiency, and general well-being.
Nebraska minimum wage laws allow employers to pay trainees a subminimum wage rate of no less than 75 percent of the federal minimum wage to new hires under 20 years of age and who are not seasonal or migrant workers.
The employers may pay the rate for 90 days from the date the trainee is hired. The employer may have the training period extended an additional 90 days if the trainee is participating in on-the-job training and:
- the training requires technical, personal, or other skills necessary for his or her employment; and
- the training is approved by the Department of Labor.
Hours worked by employees being paid the reduced training wage may make up no more than one-fourth of an employer’s total hours paid to all employees.
Employers may not pay employees the training wage rate if other employees have their hours reduced or have been laid off. The new employees’ hours or positions are considerably similar to those of the employees who have had their hours reduced or who have been laid off.
Employers are also prohibited from terminating or reducing the hours of an employee with the intention of replacing such employee or the hours of such employee with a new employee who is compensated at the training wage rate.
Nebraska minimum wage laws exempt apprentices from its minimum wage requirements. Thus, employers are not required to pay them the standard minimum wage. Nebraska does not set a minimum wage employers may pay apprentices. NE Statute 48-1202(3)(f).
Nebraska minimum wage laws exempt learners from its minimum wage requirements. Thus, employers are not required to pay them the standard minimum wage. Nebraska does not set a minimum wage employers may pay learners. NE Statute 48-1202(3)(f).
Nebraska minimum wage laws allow employers to pay student-learners a subminimum wage rate that is no less than 75 percent of the standard minimum wage if they work as part of a bona-fide vocational training program. NE Statute 48-1203(3).
Nebraska minimum wage laws do not allow employers to pay student workers a subminimum wage rate that is less than the standard minimum wage.
Nebraska Minimum Wage Laws 2023 FAQs
Can workers expect a minimum wage rate increase in Nebraska in 2023?
Nebraska’s current state minimum wage rate is $9 per hour. This is $1.75 more than the federal hour minimum wage, which is currently at $7.25.
These hourly wage rates are said to be assessed each year according to the Consumer Price Index (or CPI) and inflation trends. However, the minimum wage figure hasn’t changed since 2016 and will most likely remain the same for the rest of the year.
Are there efforts to increase Nebraska’s minimum wage in the future?
Yes, there are efforts to increase Nebraska’s current regular wage to what can be considered a fair wage.
For instance, Nebraska Appleseed, a nonprofit organization, is currently leading an initiative called “Raise the Wage Nebraska”. It is an initiative campaign using a ballot that seeks to increase the minimum hourly wage to $15 by 2026.
However, the road ahead won’t be easy. This call to raise the current minimum wage for thousands has a requirement of collecting over 87,000 petition signatures.
The deadline for filing signatures is before the November 2022 ballot.
Other individuals and organizations that support the minimum wage increase initiative by Nebraska Appleseed include the following:
- American Civil Liberties Union Nebraska
- Nebraska Civic Engagement Table
- South of Downtown Community Development Organization
- YWCA Lincoln
- Senator Terrell McKinney
- Senator Megan Hunt
- And others.
This list of supporters is still growing each day.
What are the things that business owners need to know about Nebraska’s minimum wage laws?
There are different things that business owners should consider to ensure compliance with Nebraska labor law and to keep their business operations running smoothly despite wage hikes.
Employee misclassification, for instance, is a common issue. Minimum wage laws (and their rates) can vary according to the type of employee, the employee benefits, and more.
Financial experts also suggest planning for income increases and utilizing an automatic payroll platform with custom payroll features. This way, you’ll never miss a payroll statement and further ensure compliance.