By: ZACH WENDLING/NEBRASKA EXAMINER
LINCOLN — State lawmakers seeking to slow down annual minimum wage increases that Nebraska voters approved in 2022 have reached a new deal to avoid the law’s inflationary increases.
State Sens. Jane Raybould of Lincoln and Stan Clouse of Kearney said they have found a “compromise” for Raybould’s Legislative Bill 258 that would completely remove permanent annual cost-of-living increases to the state minimum wage, beginning in 2027.
Under the Clouse amendment, the wage would increase instead by 1.75% annually in perpetuity. Under the current law, workers could see much larger increases. Average inflation for the past five years was 4.18%. Over the past 10 years, it was 2.63%. And over the past 25 years, it was 2.39%, according to data from the U.S. Bureau of Labor Statistics for the Midwest.
“It’s certainty, and I like certainty, and I like minimizing the risk,” Clouse said at the beginning of April, when he pitched a fixed annual increase rather than a sliding scale tied to inflation.
Raybould said her motivation and why she keeps pushing “passionately” for her measure is to help small businesses and others who might not be able to absorb the cost of rising wages that she said could pass on costs to consumers.
“I know that this is the right thing to do, to create a balance,” Raybould said this week. “You have to always balance it out to make sure that we maintain the economic vitality and vibrancy and economic growth in our state without falling off and creating a cycle of cost increases that are so much harder for Nebraska families to be able to afford.”
Clouse has said that unless his amendment has been attached to LB 258 before the end of the next four-hour debate on LB 258, he will not vote for the measure. His vote matters because overcoming a filibuster requires 33 votes, and Clouse is likely Raybould’s 33rd vote.
State Sen. Danielle Conrad of Lincoln has filed multiple motions and amendments to try to prevent his amendment from being attached, one of the opponents who say Raybould’s bill goes against voters.
Nebraska first enacted a state minimum wage of $1 in October 1967, 29 years after Congress passed a federal minimum wage, first at 25 cents for select workers. The federal minimum wage sets a floor for workers’ pay when state wages don’t keep up.
The Nebraska minimum wage did not overtake the federal minimum wage until voters acted in 2014, increasing it to $9 by January 2016.
In 2022, voters acted again and decided to permanently go around the Legislature, opting for annual $1.50 increases through 2026, up to $15, before shifting to annual cost-of-living adjustments.
Raybould, a longtime grocery store executive who was elected to the Legislature in 2022, first proposed capping annual minimum wage increases to up to 1.5% in 2023. Former State Sen. Tom Briese of Albion, now the state treasurer, had a separate measure seeking to amend the state training wage for teen workers, while also seeking to create a “youth minimum wage” for 14 or 15 year olds.
The training wage was first established in July 1991, allowing employers to pay workers younger than 20 a lower wage for up to the first 90 days of employment. The wage expired after March 1993 but returned in September 1997.
LB 258 would exempt 14 or 15 year olds from the training wage but create a subminimum wage for the youngest workers that could stay in place until they age out.
Raybould’s version of the original Briese proposal, in LB 258, includes the following:
- The training wage would be limited to teen workers ages 16 to 19. It would rise to $13.50 this September and, beginning in 2027, increase by 1.5% each year. The training wage in Nebraska has been tied to 75% of the federal minimum wage since 2007. With the $7.25 federal wage not increasing since 2009, the training wage has been locked at $5.44.
- The youth minimum wage would be created for 14 or 15 year olds, exempting them from the training wage. It would start at $13.50 in January 2026 and increase every fifth year by 1.5%.
The state minimum wage for adults and older teens would rise by 2065 to $29.51 under Clouse’s amendment. That’s the same point at which the new youth minimum wage would finally catch up to the $15 baseline wage that voters approved for all Nebraska workers in 2022, starting next year, based on an analysis by the Nebraska Examiner of the impact of the Clouse and Raybould language.
The disparity between the state minimum wage and the youth wage would grow over time, from about 90% of the state wage in 2026 to about half of the Nebraska rate by 2065. That’s young workers born after 2050.
The training wage would be $24.13 in 2065, or about 82% of the state minimum wage. Raybould said it’s critical to correct an “oversight” from past legislation and ballot measures that left out increases to the training wage and sever that wage from the stagnant federal rate.
Emancipated minors would be paid the full state minimum wage as older workers, which Raybould and supporters have said would help some young parents or youths who need the most support.
However, very few minors are granted emancipation, according to court data that Conrad requested and shared with the Examiner. In the report, 143 emancipation cases were filed with the judicial system, dating back to 2019 and including the early part of 2025.
Over that period, the court system granted 65 youths emancipation, and eight more cases were pending. It’s unclear how many of those minors were 14 or 15 years old.
Local businesses sought to employ 2,874 teens aged 14 or 15 in 2022, according to a March 2023 Nebraska Department of Labor report.
Raybould said she continues pushing for the youth minimum wage partly because of child labor laws that the Occupational Safety and Health Administration helps enforce. Under the requirements, a 14- or 15-year-old can only perform certain non-hazardous or non-manufacturing duties or work certain hours. Businesses face severe penalties for noncompliance.
These teen workers can’t work more than three hours on a school day or more than 18 hours during a school week. Work hours are restricted between 7 a.m. and 7 p.m., except around the summer when night hours are extended to 9 p.m.
Raybould said she’s heard from many business leaders who say they would hire 14- or 15-year-old workers but that the same minimum wage coupled with OSHA restrictions is a disincentive for doing so.
She said her family, which operates B&R Stores, Inc., the parent company of Super Saver, Russ’s Market and other local grocery stores, hasn’t hired those youngest workers for about 20 years “for the very reason of the equipment and things they are not permitted to do.”
If the youth wage were established, she said some businesses might reconsider hiring young workers. However, she said her grocery stores wouldn’t because of “too many restrictions.”
Raybould retired as vice president of her family company, founded in 1964, at the end of March. She continues to serve as vice chair of the company board and has filed a conflict of interest statement on her measure.
LB 258 would not be the final say on minimum wage, Raybould added, as future lawmakers or voters could still act. She noted employers also would not be prohibited from paying more than the minimum wage or from not adopting training or youth wages. She said she realizes workers, during a workforce shortage, are looking for competitive wages, benefits and hours.
Raybould’s bill would not change the $2.13 minimum hourly wage paid to workers earning tips or gratuities, which hasn’t changed since 1991.
Conrad, who helped run the 2014 ballot measure that brought the state minimum wage above the federal rate, and State Sen. Terrell McKinney of North Omaha, who helped lead the 2022 measure, have led opposition to Raybould this spring. All three are Democrats, with Raybould standing alone among her progressive colleagues in the officially nonpartisan Legislature.
Much of the opposition cites the “will of the voters” in 2022, when the McKinney-backed measure secured about 59% support statewide and majority support in 38 of 49 legislative districts.
Conrad blasted the creation of a youth wage as viewing young workers as “subhuman” and urged Raybould to show where in her campaign she said she would “stick it to low-income working families.”
“The frustration is that you shouldn’t have to explain basic civics to adult state senators,” Conrad said during the earlier debate.
As a freshman lawmaker in 2007, Conrad helped keep the state minimum wage on track with the federal minimum wage after a last-minute emergency congressional spending bill, focused on disaster relief for Hurricane Katrina and funding for wars in Iraq and Afghanistan, passed with minimum wage increases.
The first bill Conrad ever introduced, in 2007, sought to increase the state minimum wage and seek regular inflationary changes, while also increasing and narrowing the state training wage and tying the tipped-worker wage to 50% of the state minimum wage.
One of the lobbyists opposing that bill is now a freshman senator, State Sen. Bob Hallstrom of Syracuse. He was representing the National Federation of Independent Business.
A much-narrowed version of Conrad’s bill came to fruition at the tail-end of the 2007 legislative session, which inadvertently led to a temporary 53-day decrease in the state training wage because of differences in the timing of the state and federal laws taking effect, a hiccup that was added when Conrad’s bill was amended into a similar bill.
Speaking with the Examiner this week, Conrad said the debate needs to remain focused on voters and low-income families or low-income working young people, who she said would be most hurt by LB 258.
“Anything that has caused us to lose sight of the true impacts of these harmful measures is a distraction, and if Senator Raybould wants to perpetuate some sort of personal attacks or can’t defend her own position in financial conflict, that’s on her,” Conrad said. “Senator Raybould is not a victim.”
Conrad said she and Raybould have been friends for a long time and agree on more than they disagree. While this “sharp disagreement … is painful for both of us,” Conrad said she continues to consider Raybould a friend.
McKinney has said a “common theme” of the 2025 session so far has been to go against voters, whether it be weakening paid sick leave, medical cannabis or minimum wage measures. He called it “sad, to say the least.” He unsuccessfully tried to raise the state minimum wage with legislation in 2021, before leading the 2022 ballot measure.
“When you have stagnant wages, you have people stuck in a cycle,” McKinney said during the previous debate. “And then you have people telling people to pull yourselves up by your bootstraps, do all these things, but we have stagnant wages.”
Raybould has described her bill as exercising the Legislature’s referendum power to modify, amend or repeal voter-enacted laws.
State Sen. Kathleen Kauth of the Millard area, who chairs the Business and Labor Committee that advanced Raybould’s bill, said she was very much against the Raybould and Briese ideas when the youth minimum wage would have applied to 16 or 17 year olds.
Once Raybould limited the youth minimum wage to 14 or 15 year olds, citing the federal restrictions, Kauth came on board.
“Raising the minimum wage does nothing more than a very temporary measure to make you feel good for a little bit,” Kauth said.
She continued: “If you have not improved your skills, you haven’t taken on more responsibility, got more education, or done something to differentiate yourself and improve, then everybody’s going to just kind of float at that same level and everything becomes more expensive.”
Next year, Raybould will have a choice to make on whether she runs for reelection, but she said she has “never cared, not ever” about whether she is reelected. Instead, she said she cares about “doing the right thing every day for the right reasons that help the most Nebraskans.”
She said she’s heard from constituents who have thanked her for the measure, as well as others who have called her self-serving, self-centered and selfish. Of the hits, she said, “I just have to take those.”
Raybould said her constituents know her, that she is informed and does her “homework,” and that her 2026 reelection decision is up to central Lincoln voters. She previously served four years as a Lancaster County commissioner and eight years as a member of the Lincoln City Council, and she was the Democratic candidate in 2018 against U.S. Sen. Deb Fischer, R-Neb.
“It’s really up to them to make that decision if they want me to run again or if they want someone else,” Raybould said. “And if they want someone else, I would support that too.”