Everything You Need to Know About the Nebraska Data Privacy Act

The Nebraska Data Privacy Act represents a significant step forward in data security, data protection, and data privacy for Nebraska–based consumers. The law mandates strict guidelines and protocols for organizations doing business in Nebraska that process, handle, share, or store personal data belonging to Nebraskans. This law was introduced to address growing concerns about data breaches and the misuse of personal information, offering Nebraskans a robust framework for data protection.

Compliance with this law helps organizations build trust with consumers, demonstrating a commitment to safeguarding sensitive information. Additionally, compliance spares organizations from potential legal repercussions, fines, and reputational damage that could result from data breaches.

In this article, we’ll take a closer look at the law, its components, requirements for businesses, and benefits for consumers.

Overview of the Nebraska Data Privacy Act

The Nebraska Data Privacy Act (NDPA), was signed into law on April 17, 2024 and takes effect on January 1, 2025. The NDPA applies to persons who conduct business in Nebraska or produce products or provide services consumed by Nebraska residents. It also applies to organizations that process or sell personally identifiable or protected health information (PII/PHI) of Nebraska residents.

LB1074 was introduced and ultimately passed in response to increasing concerns about data security and privacy. Legislators in Nebraska recognized the need for a comprehensive legal framework to address these issues, especially as data breaches and cyberattacks have become more prevalent.

The law’s primary aim is to ensure that organizations take the necessary steps to protect personal data and that consumers are informed about how their data is being used.

By establishing clear guidelines and requirements, the NDPA intends to create a safer environment for both data holders and data subjects. The law covers a wide range of data protection measures, including data encryption, access controls, and breach notification processes. These measures are designed to prevent unauthorized access to personal data and ensure that any breaches are promptly addressed.

Key Provisions of the Nebraska Data Privacy Act

The NDPA has broad applicability. Nevertheless, it details specific provisions that organizations must follow to safeguard Nebraskan’s personal data. These are just a few examples:

Sensitive Data and Children’s Data

Sensitive data is defined broadly to include data on race, religion, health, sexual orientation, citizenship status, biometrics, geolocation, and children’s data. Companies must obtain opt–in consent before processing sensitive data like racial/ethnic data, health data, biometrics, geolocation, or children’s data.

Data Protection Assessments

Companies must conduct data protection impact assessments for higher risk activities like targeted advertising, sale of data, profiling, processing sensitive data, or any processing presenting heightened risk of harm.

Privacy Notices

Companies must provide clear and accessible privacy notices disclosing categories of data processed, purposes, consumer rights processes, data sharing practices, and data retention periods.

Contracts with Processors

Controllers must have contracts with processors that govern data processing instructions, confidentiality, data deletion, and assistance with consumer requests.

How Consumers Benefit from the NDPA

For consumers, the Nebraska Data Privacy Act offers peace of mind and greater control over personal information. The law requires organizations to be transparent about data collection and usage practices, allowing consumers to make informed decisions about their data. With stringent data protection measures in place, consumers can have confidence that their personal information is being handled responsibly.

Additionally, the Nebraska Data Privacy Act includes provisions for breach notification, ensuring that consumers are promptly informed if their data is compromised. This allows individuals to take necessary actions to protect themselves, such as changing passwords or monitoring accounts for suspicious activity. Overall, the Act enhances consumer rights and provides a safer data environment.

The Nebraska Data Privacy Act grants the following key rights and protections for consumers:

• The right to access their personal data that a company holds on them.
• The right to correct inaccuracies in their personal data.
• The right to delete their personal data that was provided by or obtained about them.
• The right to obtain a copy of their personal data in a portable format to transfer to another company.
• The right to opt out of the processing of their personal data for targeted advertising, the sale of their data, or profiling that produces legal or similarly significant effects.
• Requirement for companies to obtain consent before processing sensitive personal data, which includes data on race, religion, health, sexual orientation, biometrics, precise geolocation, and children’s data.
• Requirement for companies to conduct data protection impact assessments for higher risk processing activities like targeted advertising, sale of data, profiling, and processing sensitive data.

NDPA’s Impact on Businesses

The impact of the Nebraska Data Privacy Act extends beyond regulatory compliance to influence various aspects of business operations. One significant impact is the potential for enhanced customer trust. By demonstrating a commitment to data protection, businesses can build stronger relationships with customers, which can lead to increased loyalty and a competitive advantage. Transparency about data handling practices fosters confidence and encourages customer retention.

Compliance with the Act also helps businesses avoid the substantial financial costs associated with data breaches. Legal fees, regulatory fines, and the costs of breach remediation can be crippling, especially for smaller organizations. By adhering to the Act’s requirements, businesses can mitigate these risks and protect their financial health. Additionally, compliance streamlines data management processes, making them more efficient and secure.

The Act also encourages innovation in data protection technologies. Organizations are incentivized to adopt cutting–edge solutions to meet compliance requirements, leading to advancements in encryption, access control, and breach detection technologies. These innovations not only enhance compliance but also contribute to overall data security advancements.

Compliance Requirements

The NDPA imposes various obligations on organizations doing business in Nebraska. These obligations include, but are not limited to:

• Providing clear privacy notices
• Implementing reasonable data security practices
• Conducting data protection assessments for certain processing activities
• Obtaining consent for processing sensitive data in some cases
• Honoring consumer rights requests

It should be noted, the NDPA does include certain exceptions that allow businesses to process personal data for certain purposes without violating the law. These exceptions include:

• Complying with laws and regulations
• Cooperating with law enforcement
• Protecting against illegal activities
• Conducting research under specific conditions

Cybersecurity Requirements for NDPA Compliance

So, how exactly do businesses protect Nebraskans’ data? The NDPA lists a number of data protection requirements. One example is data encryption. Organizations must encrypt sensitive information both in transit and at rest, ensuring that even if unauthorized access occurs, the data remains unintelligible. This measure greatly enhances the security of personal information.

Access controls are another vital component. The NDPA mandates that organizations establish robust access control mechanisms to restrict data access to authorized personnel only. These controls typically involve multi–factor authentication (MFA) and strict user permissions, ensuring that only those with a legitimate need can access sensitive data. This minimizes the risk of data breaches, accidental or malicious, from insiders like employees and contractors.

Breach notification procedures are another a key element of the Nebraska Data Privacy Act. Organizations must have clear protocols for detecting data breaches and notifying affected individuals. The law stipulates that notifications must be sent promptly and include detailed information about the breach and steps individuals can take to protect themselves. This transparency helps mitigate the damage caused by data breaches.

NDPA vs. Other State Data Privacy Laws: Similarities and Differences

The Nebraska Data Privacy Act shares many similarities with other comprehensive state data privacy laws like the California Consumer Privacy Act (CCPA), Virginia Consumer Data Protection Act (VCDPA), and Colorado Privacy Act (CPA), but also has some notable differences.

The NDPA, like other state data privacy laws:

• Grants consumers rights like access, correction, deletion, data portability, and opt–out of sale/targeted advertising
• Requires businesses to provide privacy notices disclosing data practices
• Imposes data protection obligations on businesses like data security and data protection assessments
• Covers sale of personal data and targeted advertising activities
• Provides exemptions for certain types of data and entities like HIPAA, GLBA, nonprofits
• Empowers the Attorney General to enforce the law, with potential fines for violations
• Prevents private citizens from suing NDPA violators directly (no private right of action for consumers)

Despite these similarities, there are key differences between the NDPA and other state data privacy laws. The NDPA, for example:

• Provides broad applicability with no revenue threshold or data volume criteria, unlike the CCPA, VCDPA, and CPA; potentially impacting more small businesses
• Requires opt–in consent for processing sensitive data and children’s data
• Grants a permanent 30–day cure period for violations before fines, unlike sunsetted cure periods in other laws
• Has a narrower definition of "sale" compared to CCPA, not covering data exchanges for analytics services
• Does not require a data protection officer, unlike the VCDPA and CPA
• Does not require risk assessments for processing activities that present a heightened risk of harm like in CPA

In total, while the NDPA aligns with the core rights and obligations seen in other state privacy laws, it has a broader scope of applicability, requires consent for sensitive data, has a permanent cure period, but lacks some requirements around risk assessments and data protection officers found in other laws.

NDPA Non–compliance Risks and Repercussions

Non–compliance with the Nebraska Data Privacy Act poses significant risks for organizations. Legal consequences, including hefty fines and litigation, are among the most immediate concerns. Data breaches resulting from non–compliance can lead to substantial financial losses, both from direct costs such as legal fees and indirect costs like lost business and reputational damage.

Moreover, failing to comply with the Act can erode consumer trust, leading to a decline in customer loyalty and potential loss of business. Organizations may also face operational disruptions as they struggle to address and remediate data breaches. The long–term impact of non–compliance can be detrimental, affecting an organization’s ability to attract and retain customers.

Enforcement and Penalties

The NDPA grants the Nebraska Attorney General exclusive authority to enforce violations, with a 30–day opportunity for companies to resolve alleged violations before facing potential fines of up to $7,500 per violation. There is no private right of action under the NDPA, meaning consumers cannot directly sue companies for violations. Only the Attorney General can bring enforcement actions.

Best Practices for NDPA Compliance

To comply with the Nebraska Data Privacy Act, organizations should follow a comprehensive compliance checklist. This checklist includes several key steps: implementing data encryption for sensitive information, establishing robust access control mechanisms, conducting regular security assessments, and maintaining detailed records of data processing activities. These steps form the foundation of a strong data protection strategy.

Organizations must also ensure that privacy notices are clear and accessible. These notices should explain data collection practices, usage, and sharing, as well as the rights individuals have under the Act. Training employees on data protection best practices is another critical step, as it helps create a security–conscious culture within the organization.

Ensuring that third–party service providers comply with the Act’s requirements is also essential. Organizations should conduct due diligence when selecting service providers and establish clear agreements that outline data protection responsibilities. This helps mitigate risks associated with third–party data handling.

Here are some best practices businesses can follow to demonstrate compliance with the Nebraska Data Privacy Act (NDPA):

1. 1. Update privacy notices and policies to meet NDPA requirements, including disclosing data processing practices, consumer rights processes, data sharing details, and data retention periods.
2. 2. Implement processes to respond to consumer rights requests within the required timeframes, such as access, deletion, correction, data portability, and opt–outs of sale/targeted advertising.
3. 3. Obtain opt–in consent before processing sensitive data like racial, health, biometric, geolocation, or children’s data as defined by the NDPA.
4. 4. Conduct data protection impact assessments for higher risk processing activities like targeted advertising, sale of data, profiling, and processing sensitive data.
5. 5. Implement reasonable data security practices and have contracts in place with data processors that meet NDPA requirements.
6. 6. Provide training to employees on NDPA requirements and consumer rights processes.
7. 7. Maintain records of data processing activities, consumer requests received, and responses provided to demonstrate compliance.
8. 8. For violations, follow the 30–day cure period process, provide a written statement of cure, and ensure no further violations occur to avoid penalties.
9. 9. Stay updated on any regulatory guidance or amendments issued related to the NDPA.
10. 10. Consider using a privacy management platform to streamline NDPA compliance efforts across data mapping, privacy notices, rights requests, assessments, and vendor management.

Kiteworks Helps Organizations Demonstrate Compliance with the Nebraska Data Privacy Act

The Nebraska Data Privacy Act provides a critical framework for data protection, offering significant benefits to both organizations and consumers. For organizations, compliance with the Act helps avoid legal penalties, builds customer trust, and enhances data management efficiency. Consumers benefit from increased data security, transparency, and strengthened rights regarding their personal information. Ultimately, adhering to the Nebraska Data Privacy Act is essential for safeguarding Nebraskans’ data and maintaining a trusted relationship with these residents and consumers.

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