Nebraska Enacts Health Care Staffing Agency Law

On April 14, 2026, Governor Jim Pillen signed Legislative Bill 921 (LB 921) into law, which, among other provisions, created the Health Care Staffing Agency Registration Act.

This communication focuses on the healthcare staffing agency provisions, which require annual registration with the Nebraska Department of Labor (NDOL), ban noncompete clauses in contracts with workers and healthcare entities, and restrict most conversion or hire-away fees.

This update applies to healthcare staffing agencies and healthcare technology platforms operating in Nebraska. The law takes effect July 1, 2027.

What Employers Need to Do

• Determine whether the organization qualifies as a healthcare staffing agency or healthcare technology platform under the Act and prepare for annual NDOL registration.

• Review and restructure existing contracts with workers and healthcare facilities to eliminate noncompete clauses and prohibited conversion/hire-away fee provisions before July 1, 2027.

• Verify and document that each worker meets all applicable licensing, certification, registration, and healthcare requirements, and establish systems to produce records to the NDOL within 14 days of request.

• Secure required insurance coverage: professional and general liability at $1 million per occurrence / $3 million aggregate, and confirm workers’ compensation coverage, self-insurance, or occupational accident coverage is in place.

Overview

Registration and Scope

• All healthcare staffing agencies operating in Nebraska must register annually with the NDOL and pay a $1,500 fee per physical location, or a single $1,500 statewide fee if the agency has no physical location in Nebraska.
• The law covers traditional staffing agencies and healthcare technology platforms (internet or app-based marketplaces where workers select open shifts).
• Excludes physicians, surgeons, osteopathic physicians, and nurse practitioners in independent practice.
• Renewal applications must be filed at least 60 days before expiration. The NDOL will maintain a public database of registered agencies on its website.

Compliance Requirements

• Agencies must ensure and document that each worker meets all applicable federal and state licensing, certification, registration, and healthcare requirements.
• Records must be produced to the NDOL within 14 days of request, and platforms must make records accessible to workers.
• Insurance minimums include professional and general liability coverage of $1 million per occurrence and $3 million aggregate. Agencies must also maintain workers’ compensation coverage, self-insurance, or occupational accident coverage.
• Agencies ceasing operations must notify the NDOL and maintain all files and records for two years.

Prohibited Contract Terms

• Noncompete clauses are void in any contract with a worker or a healthcare entity.

• Conversion or hire-away fees are banned: agencies cannot require payment of liquidated damages, employment fees, or other compensation if a worker is permanently hired by the facility, except in two (2) narrow cases:
  • (i) Payments reduced pro rata per hour worked, reaching zero at 720 hours, or
  • (ii) Payments by a foreign worker whom the agency assisted in obtaining U.S. work authorization, with an initial assignment of at least 24 months.

Enforcement

• Civil penalty of up to $500 (first offense) and $5,000 (subsequent offenses).
• Registration may be revoked for up to one calendar year, barring new applications during the revocation period. Entities with substantially common ownership or management are also barred.
• The Commissioner may investigate complaints, conduct random audits (with at least three business days’ notice), and subpoena witnesses and records. Appeals must be filed within 20 days of a denial or citation.

Why This Matters

Nebraska now regulates healthcare staffing agencies through a mandatory registration framework that includes significant contract restrictions, including bans on noncompete clauses and most conversion or hire-away fees.

Agencies that rely on these contract terms as part of their business model will need to restructure agreements before July 1, 2027.

The Act also extends to healthcare technology platforms, meaning modern app-based staffing models are in scope alongside traditional agencies.

Key Risks for Employers

• Operating without registration after July 1, 2027: Agencies that fail to register face civil penalties of up to $500 for a first offense and $5,000 for subsequent offenses, plus possible registration revocation for up to one calendar year — with new applications barred during that period, including for entities under substantially common ownership or management.

• Maintaining prohibited contract terms: Noncompete clauses and most conversion or hire-away fees are void under the Act. Enforcement may result in civil penalties (up to $500 first offense / $5,000 subsequent offenses) and possible registration revocation.

• Failing to meet credentialing and records obligations: Records must be producible to the NDOL within 14 days of request, and the Commissioner may conduct random audits with at least three business days’ notice. Non-compliance may result in civil penalties and possible registration revocation.

• Common-ownership revocation reach: When a registration is revoked, entities with substantially common ownership or management are also barred from new applications during the revocation period — meaning a single agency’s non-compliance can affect affiliated agencies operating in Nebraska.

Source References

• Nebraska LB 921 – Adopt the Nebraska Worker Adjustment and Retraining Notification Act and Others

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