Labor Rates

Labor Rates are key entries for Billing and Profit and Loss calculations. They control how Labor is charged to the Customer, including Initial Charges when working on a job.

Labor Rates are usually a set amount for a particular type of work. There is no explicit relationship to cost, because the Pay Rate for Employees (their cost to the Company) may differ. Labor Rates are set with a general consideration of Cost, but not with an explicit Markup (except for the Tech Markup).

By setting up and using Labor Rates carefully you can do your billing without tedious manual calculations. The person entering Labor as Item details on Work Order transactions specifies the time worked and the rest is automatic.

You can enter Labor Rates in the following places to influence the logic of defaults and overrides in Pricing calculations. (To understand better how and where Labor Rates are used, see Control Pricing.)

•	Controlling the entire Work Order:

►	Company Preferences, Work Order - determines Work Order Type

►	Work Order Type - contains Parts Markup and Labor Rate

►	individual Work Order General Tab - contains Parts Markup and Labor Rate

►	individual Agreement Pricing Tab - contains Parts Markup and Labor Rate

•	Controlling the Work Order Item Detail Lines:

►	Employee Details Tab - optional Labor Rate override

►	Employee Pay Types - Labor Rate Markups for Overtime, etc.

►	Customer Special Pricing Tab - Labor - optional Labor Rate override

►	Labor Codes - optional Labor Rate override

►	actual keyed entry on Item Detail for Labor

Setting up a Labor Rate:

•	On the Work Menu at the top of the screen, click the Work Order down-arrow, and select Labor Rates.

•	The smaller-size Lookup screen will appear. (To add or change a record, see Small Lookup, Add or Edit.)

•	Next, the Labor Rate Details screen will appear. This screen has a second Tab for Notes.

Explanation of Initial Charges in screen example:

The Labor Rate called Framing has a Rate Type of Hourly Rate of $85.00. The Initial Charge Time is the first 45 minutes and the Initial Charge is $100.00.

•	No matter how long the Technician is on the Job Site, the first 45 minute charge will be $100.00. For the remaining time (after the 45 minutes) the Framing Rate charge is $85.00 per hour.

•

However, if the Technician was actually at the Job Site for less than the Initial Time of 45 minutes, the charge remains the Initial Amount of $100.00 for that visit. (You also have the ability to preset a Trip Charge for every Job Site, which is similar, but relates to characteristics of the Job Site.)

Screen fields:

Labor Rate Name:

Required. Abbreviated but descriptive name for this Labor Rate.

Rate Type:

Select one of several methods for charging Labor to Customers:

•	Hourly Rate - a predefined fixed hourly rate, for instance $40 per hour

•	Fixed Amount - a flat amount, as opposed to an Hourly charge

•	Tech Rate Markup - a markup based on the Pay Rate (Company Cost per hour) for your Technician. For example, if you pay your Technician $25 per hour, you could specify a markup of 125%.

Hourly Rate:

Used if Rate Type above is Hourly Rate.

Fixed:

Used if Rate Type above is Fixed Amount.

Markup %:

Used if Rate Type above is Tech Rate Markup.

Here are the results from using Margin Percents, rather than fixed amounts. Note there are two types of "discounts." (For examples of Margin Percent variations, see Labor Discounts in Special Purpose Pricing.)

1.	zero % = No-Charge

2.	under 100% = Margin Discounts (on Pay Rate, Company Cost, = Loss)

3.	equals 100% = No-Markup for Margin

4.	over 100% = Normal Margin Markup - and/or Discount, on Cost Basis

Note: Take steps to set up Labor Rates with Markups specifically for your Agreement Types. For instance, you probably need a "No Charge" type of Markup, and possibly others.

Initial Charge Time:

The amount of time considered as the Minimum Time for this type of Labor.

Initial Charge:

The Minimum Amount charged for this type of Labor.

QB GL Account:

The Sales Account used for this Labor which links to a QuickBooks GL Account. (See Lookup Combo Box. To add an entry, click the Ellipsis button (…) and select New.)

QB Name:

If the Labor Rate Name field (above) in FieldOne differs from the Labor Rate in QuickBooks, use this field to link them. Over time there may be reasons to change the Import name, but then you must store the original value here. (For more details refer to Understand QuickBooks Naming Exceptions.)

Note: The QB Name list is only available after running QuickBooks Integration.

Is Active:

Use the checkbox to indicate currently used by your Company. If you later remove the check-mark making this field Inactive, this entry will still show on older records where it has already been used, but will not be available for use in the future.

The default for the Lookup screen is to show Only Active records. You can remove the check-mark from the select-box on that screen and view all.

When complete:

Click OK to save your entries and exit the screen.

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