Why track time
- Payroll to compensate hourly employees
- Billing to invoice for time and material jobs
- Labor analysis
- Benchmarks for employees performance and processes. Data provides insights into opportunities for improvements, efficiencies, and work time line comparison.
- Profitability data to determine if time spent on jobs, calls, and opportunities is profitable to assist in making business decisions
- Differentiate employee utilization across three main areas to determine where labor is spent
- Pre sales activities such as sales opportunities
- Billable based on customer record or project type
- Administrative
- Forecast labor needs such as resources and time for what work needs to be done.
- Recognize cost and revenue to capture actual labor costs for job costing, increase % complete, etc.
Who tracks time
Yes
- General and administrative (SG&A)
- Administrative employees such as HR, Admin and IT
- Warehouse for picking and shipping
- Accounting AR
- Accounting AP
- Direct employees
- Designers and engineers
- Project managers
- Installers and technicians
- Service employees
- Support and CSRs
No
- Sales
- Executives and management
Maybe
- Supervisors and management
How to track time
System Setup
Configuration setting: UNIFIEDTYP = ON
- Aligns revenue and costs to GL accounts
- Allows definition of different billing rules by unified type. For example, rounding differently for remote vs. on site support.
- Factors to define which master number is associated to a time bill record based on UNIFIEDTYP setup
Configuration setting: COGSHR
- ON
- Labor cost comes from Employee record
- Accurate tracking of employee cost and performance
- Input directly to payroll to actual person’s cost is how much is owed in pay
- Differentiation of labor costs between wage types such as overtime and prevailing
- Separate GL credits of time bill between labor and burden through wage type, and visible in Accrual Payroll accounts
- OFF
- Labor cost comes from standard cost details from the linked master item on time bills
- Simple setup
- Does not derive employee’s actual hourly cost
- Maintains privacy
- Uphold fairness in job costing as job profitability impacts commission
- Employees are not penalized for use of high cost labor
- Simple comparison and analysis between labor sold versus actual dollars cost
Category and Sub Category fields in Time Bill form
- Purpose
- Defines the type of work
- Aligns revenue and costs to GL accounts
- Allows definition of different billing rules by unified type for time and materials
- Factors define which master number is associated to a time bill record
- Track budget based on type of work
- Analysis and improvement insights
- Forecasting labor needs based on type of work
- Input to Employee Utilization based on type of work
- Input for quoting future work
- Setup for Time Bill Category and Sub Category
- Use of category and sub category combination simplifies selection of master number
- Can tie sub categories (child) to categories (parent)
- Configured in the general codes TBCATEGORY and TBSUBCAT
Masters items
- L type master items are used for tracking time and labor. They must be used in both Quote and Timebill category and sub category mapping.
- Input for the Budget to Actual Report for projects
- Allows definition of accounting rules, such as sales tax and posting cost and revenue GL accounts
- Defines disciplines such as Project Management, Training, Installation, and Engineering
- Intended for salaried, hourly, and contract employees. Not applicable to subcontractors.
Labor rates
- Maps time bill record Category and SubCategory to a master item
- Defines rules for billing labor on service calls
Employee wage type
- Allows to define labor cost per employee
- Defines the GL account to post journal entries to on Post Time Bill
- Defines different labor cost based on different time periods. For example, salary raise for same wage type.
Employee burden
- Allocates direct and indirect cost to an employee, outside of their salary such as health benefit, vacation, lack of utilization, insurance, general expenses, and overhead.
- Defined as a percentage of the labor cost
- Can set different percentage by wage type
- Can associate different burden to employees such as someone with a vehicle versus one without a vehicle
Employee schedule type
- Defines the different categories of available and unavailable labor hours, tracks allocations, and accruals. For example, 1 day off for X hours worked.
Payroll report (optional)
- Provides details about export of labor including time worked, type of time worked, days unavailable, location of work
Accounting structure
- Default extended accounts define the expense and revenue grouping for masters items
- Master extended accounts define the exceptions by master number to the expense revenue defined in default extended accounts
Ongoing Maintenance
Employee records
- Wage type, burden, etc.
- Employee schedule
- Permissions
Project records
- Employees time bill against project tasks
- Project TYPE determines whether employee utilization to be considered for internal admin vs not (Y/N for ‘Admin Project’)
Call records
- Employees time bill against service calls
Opportunity records
- Employees time bill against sales opportunities
Time bill post / approve
- Report To and Managers posts time bill records
- HR approves posted time bill records
User best practices
Capture real time work in the following locations:
- My Tasks grid for project tasks, calls, and sales opportunities
- Technician App for project tasks and calls
Review time billing
- Reviewers are project managers and other managers
- Daily review in the morning (for previous day)
- Weekly review for utilization and compliance
- Monthly review for metrics, KPIs, and utilization
Post time billing
- Writes journal entries and posts labor costs
- Posted by employee managers
- Posted daily after review
HR approve time billing
- Performed by HR/Payroll personnel
- Occurs weekly, at a minimum, regardless of payroll cycle
- Does the following:
- Releases to payroll
- Provides a feedback mechanism to organization
- Locks down time bill records, no more edits to maintains payroll integrity