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- Setting up overhead detail codes
- Setting up overhead group codes
- Setting up federal classification codes
- Setting up union categories
- Setting up union codes
- Setting up employee codes
- Setting up rate classes for union payroll
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Overhead detail codes define how overhead amounts are calculated based on payroll costs. You can recognize indirect labor costs, not typically set up as cost codes on an hourly or piecework basis, as overhead. These costs are added to posted amounts for the detail and are not identified separately on customer invoices.
For example, assume you employ a technician, JBLACK, who works 10 hours at $10 per hour. If you set up a fixed cost overhead detail code of $5 per hour to account for benefits and a fixed cost overhead detail of 20 percent for general overhead, JBLACK's job wage calculation is:
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In this example, you would enter two overhead detail codes: one for benefits and one for general. You could use the abbreviation code BEN for the description "Benefit" and use $5 for the fixed portion. You could also use the code GEN for the description "General Overhead" and 20 percent as the portion.
The payroll transaction posts in Job Cost and then in the general ledger, provided the accounts are the default general ledger accounts, as a debit to WIP-Labor, a credit to the Wages Payable account of $100, and a credit to the Overhead Offset account of $70. The Wages Payable and Overhead Offset posting accounts default by division from the Revenue and Exp Account Setup window.
The methods for calculating overhead are flexible. You can allocate overhead on a cost-per-unit basis to a labor cost code or as a percentage of cost, or a combination of both.
You must set up detail codes for overhead in Job Cost regardless if you apply overhead to your jobs. To do so, create an overhead detail code for zero percent or zero dollars per unit.
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Overhead group codes organize overhead detail codes logically per departments, positions, and pay codes. For example, assume you set up detail codes for hourly workmen's compensation overhead and hourly driving time to a site. You combine these details under a group code named Hour and specify that the code applies to technicians assigned to the installation department.
The following illustration shows how overhead details can be grouped: 
Each detail code represents an indirect cost. You could enter the percentage of wages incurred on each of the details and use the appropriate amounts to calculate and track overhead costs on Job Cost payroll transactions assigned to the installation group code.
Grouping detail codes allows you to use both percentages and fixed amounts when calculating specific overhead amounts.
To post payroll transactions, you must set up at least one overhead group. Even if your company does not assign overhead costs to jobs, you must create an overhead detail code for zero percent or zero dollars per unit. You then assign the code to overhead group codes for each job department/position combination. See Setting up overhead group codes.
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You must set up detail codes for overhead in Job Cost regardless if you apply overhead to your jobs. To do so, create an overhead detail code for zero percent or zero dollars per unit. |
Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Overhead Detail Codes.
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If you have unposted payroll transactions (for either Microsoft Dynamics GP Payroll or TimeTrack), do not change overhead detail codes (or create new codes and assign them to affected overhead accounts) until all unposted transactions are posted. Otherwise, posting these transactions could result in unbalanced general ledger entries. Contact Key2Act Support for assistance.
- Complete the following fields, as necessary.
- Overhead Code, Description:Enter an abbreviated name and a description for the overhead classification.
- Allocation MethodAssign : Assign one of the following methods of calculating overhead for the detail code:
- Fixed portion: Allows you to allocate overhead on a cost per unit basis for payroll transactions. For example, if you want to apply hourly overhead to account for the cost of employees driving to and from a job site, you could add $1.50 per hour (the unit of measure) with an overhead detail code to cover the cost.
- Percent portion: Allows you to allocate overhead on a percentage basis for payroll transactions. For example, you can set up an overhead detail code for the cost of taxes incurred on an employee's pay rate that adds 16 percent of the payroll wages.
- Fixed Portion, Percent PortionEnter : Enter the fixed portion or percent portion amount. The field that is enabled depends on the allocation method you chose.
- Choose Save.
- To print only the overhead detail codes using the Overhead Detail Codes report, choose File > Print or choose the printer button. To print all detail codes (including overhead), choose Reports > Job Cost > Job Reports > Detail Codes List.
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- Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Union Categories.
- Enter a Union Category.
- Mark the appropriate check box to determine which window the union categories will be displayed in:
- Display in union benefit windowUnion : Union categories will appear in the Union Benefits Setup window.
- Display in union deduction windowUnion : Union categories will appear in the Union Deductions Setup window.
- Choose Save.
- To print the Union Categories List report, choose File > Print or choose the printer button.
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You can set up union codes that identify the unions your company is required to report to. Once unions are created, you can assign benefits, pay codes, and deductions.
Step 1: Create a union code.
- Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Union Codes.
- Enter the union code, description, and address information. The Benefits, Hours, and Deductions buttons become enabled.
- Choose Save.
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Note: You must pay employees weekly and use the Microsoft Dynamics GP Payroll module to print Job Cost Union reports. Also, the date used for building checks must be the same as the beginning and ending dates on your payroll transactions.
Step 2:
Assign union benefits.Anchor job_cost_setting_up_union_codes__2891 job_cost_setting_up_union_codes__2891
- Choose the Benefits button in the Union Code Setup window. You can assign the benefits provided by a union to the union codes. Example benefits include 401K and life insurance.
- Choose a benefit category from the Benefit Category drop-down list. This list contains the benefit categories defined in the Union Category Setup window.
- Choose a Benefit Code in the list and then choose Insert >>. The benefit code appears in the Union Benefits list.
- Choose Save.
- To print the Unions Benefits/Deductions List report, choose File > Print or choose the printer button.
Step 3:
Assign pay codes.Anchor job_cost_setting_up_union_codes__4570 job_cost_setting_up_union_codes__4570
- Choose the Hours button in the Union Code Setup window. You can assign pay codes set up in Microsoft Dynamics GP Payroll to a union pay type for the union code. Example pay codes include hourly and overtime.
- Choose a pay type from the Union Pay Type drop-down list.
- Choose a Pay Code in the list, then choose Insert >>. The pay code appears in the Union Codes list.
- Choose Save.
- To print the Unions Benefits/Deductions List report, choose File > Print or choose the printer button.
Step 4:
Assign union deductions.Anchor job_cost_setting_up_union_codes__1375 job_cost_setting_up_union_codes__1375
- Choose the Deductions button in the Union Code Setup window. You can assign deductions associated with a union to the union codes.
- Choose a deduction from the Deduction Category drop-down list.
- Choose a Deduction Code in the list and then choose Insert >>. The deduction code appears in the Union Deductions list.
- Choose Save.
- To print the Unions Benefits/Deductions List report, choose File > Print or choose the printer button.
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- Multiple unions for one rate classYou : You can have multiple unions for the same rate class. This is useful if you have employees from multiple trades employed on the job, or an employee who works for another union local (besides his home local) for a short amount of time. Conversely, you can also have one union be part of multiple rate classes.
- Multiple calculation methods for benefits and deductionsYou : You can calculate benefits or deductions based on % of Net Wages, % of Gross Wages, % of Deduction, and % of Earnings Wages, just as you can in Microsoft Dynamics GP. In addition, the system allows fixed Microsoft Dynamics GP benefits and deductions to be calculated, even if they are not set up as being part of a rate class, for example, if an employee has garnishments set up in GP.
- Prevailing wage and benefit determinationYou : You can implement prevailing wage and fringe rates into your payroll calculations, based on the information from the government-supplied Davis-Bacon Act (DBA) wage determination sheet. This information is based on the union, county and occupational (fed class) code and includes standard and overtime rates for wage and fringe benefits.
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The rate class feature allows employees to use the same "base" pay codes and benefit codes, relying on the system to substitute the appropriate pay rate or benefit/deduction calculation depending on several factors such as varying union local guidelines, job location (for example, Milwaukee vs. Chicago), or even the type of job (for example, heavy commercial vs. light commercial).
An example would be when an employee receives a completely different compensation package for a period of time, such as when a journeyman is the most senior person on a job site and thus qualifies for the Foreman wage and benefit package for that period of time.
The rate class calculates rates based on a matrix of job positions (classification), pay codes, and union codes; each of which can be changed on a line by line basis on the timesheet.
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Before you install the latest Microsoft Dynamics GP service pack relating to payroll issues, and before you use rate classes, contact Key2Act Support. |
Before you begin
Before you use rate classes, make sure the following have been set up:
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- To set up pay codes, choose Microsoft Dynamics GP > Tools > Setup > Payroll > Pay Code.
- To set up deductions, choose Microsoft Dynamics GP > Tools > Setup > Payroll > Deductions.
- To set up benefits, choose Microsoft Dynamics GP > Tools > Setup > Payroll > Benefits.
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Once you decide to use rate classes, make sure you set up all pay codes as part of a rate class. Otherwise, checks will be calculated based on Microsoft Dynamics GP Payroll instead of rate classes. |
Setting up rate classes
Setting up rate classes involves the following:
Step 1: Enable the rate class feature
Step 2: Set up rate class codes
Step 3: Set up rate class detail
Step 4: Assign rate classes to union employees
Step 5: Assign rate classes to jobs
Step 1: Enable the rate class feature
You enable the rate class feature in the Posting Options window.
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- Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Job Cost Setup > Posting Options.
- In the Payroll section, mark the Rate Class check box.
- Choose Save.
Step 2: Set up rate class codes
This is where you enter your rate class codes, enable prevailing wage and fringe rate calculation feature (which includes use highest wage rate), or only the use highest wage rate (excluding prevailing calculation).
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- Enter a Rate Class code name. Give some thought as to how you want to categorize/name your rate classes. For example, if you are setting up your rate classes to reflect the type of job, for example, heavy commercial vs. light commercial, indicate that in the rate class name.
- Complete the remaining fields, as necessary.
- Rate ClassEnter : Enter the name of your rate class, being as descriptive as possible.
- DescriptionIt : It might be a good idea to include the names of the unions assigned to this rate class, in this description.
- Use Prevailing Wage and Fringe (Davis Bacon)If : If your organization pays its employees' wages and fringes based on the government-supplied wage determination sheet, mark this check box so that you can set up rate classes to automatically calculate those rates and fringes. If this check box is marked, the second is automatically marked. When you mark this check box, the Use Highest Wage Rate check box is marked automatically, as the prevailing feature must first determine the highest wage rate for an employee.
- Use Highest Wage RateIf : If your organization pays its employees the highest rate no matter what, mark this check box, and leave the other check box unmarked. The system deter mines the highest rate from the following: 1) employee 2) rate class 3) job rate class and 4) transaction (if different).
- Choose Save.
Step 3:
Set up rate class detailAnchor job_cost_setting_up_rate_classes_80 job_cost_setting_up_rate_classes_80
You can set up multiple rate classes for multiple position/pay code/deduction-benefit category combinations.
You can enter special rates for benefits and deductions using either a fixed dollar amount or percentage of gross wages. These amounts override any rates set up in the Employee Deduction Maintenance window (for deductions) and the Employee Benefit Maintenance window (for benefits).
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You can set up multiple rate classes for the same union. |
- Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Rate Class.
- Choose a Rate Class code.
- Fill the remaining fields, as necessary.
- Federal Classification CodeThe : The federal classification code is an assigned code for this type of work. This field acts as a filtering field, which allows you to view the rate classes for just one particular federal classification code.
- Union CodeEnter : Enter a union code to be associated with this rate class.
- Payroll Record TypeChoose : Choose from Pay Codes, Deductions and Benefits.
- PositionThe : The job position associated with this union/rate class.
- Deduction/Benefit CodeIf : If the Payroll Record Type is Deductions or Benefits, choose a Deduction/benefit code from the lookup.
- Calculation MethodChoose : Choose from the following:
- Percent of Gross Wages: e.g. 401K matching based on employee contribution
- Percent of Net Wages: e.g. Vacation pay or employee garnishments
- Amount Per Unit: e.g. Pension, Health and Welfare
- Percent of Earnings Wages: e.g. Over-scale pay rates
- Pay CodeThe : The pay code associated with this rate class, for example, hourly, salary, overtime, double time, and so on.
Dollar Amount/Percentage
For: For pay rate or deduction/benefit, enter a dollar amount if the calculation method is Amount per Unit, or a percentage if the method involves a percentage, for example, % of gross wages.
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If you will be printing the Microsoft Dynamics Worker's Compensation Summary
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report (Reports > Payroll > Period-End), you will need to up the Job Cost Rate Class amount so that it takes into account the pay factor for the pay codes set up in Microsoft Dynamics GP. For example, if you are creating an overtime rate class and in Microsoft Dynamics GP you've created a standard pay code that is $10/hr and then create an Overtime pay code that has a pay factor of 1.5 and is based on the standard pay code, you will need to enter $15 for the Overtime rate class.
- When finished, choose Save. Your new rate class will appear in the scrolling window in the lower portion of the window.Proceed with adding other unions to the current rate class - OR - create additional rate classes.
- To print the Rate Class report, choose the printer button. This report contains a list of all rate classes and their associated unions. If a rate class is selected when you choose the printer button that the rate class and union code will default as the selection criteria in the Rate Class Report window. To edit a rate class, double-click a record and edit the fields. If you change the Position, Pay Code, or Deduction/Category field, a new record will be created. The record you first selected is not overridden. The first record is overridden only if you change the amount or percentage in the Calculation Type field.
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| You cannot delete a rate class if it is assigned to an employee, a job, an uncommitted TimeTrack transaction, or uncommitted Microsoft Dynamics GP Payroll transaction. You can delete an entire rate class (and all its records) if a rate class is selected and none of the individual records are selected.See Copying rate classes. |
Step 4: Assign rate classes to union employees
You can assign a rate class to each union employee. Each employee can be assigned to only one rate class.
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- Choose Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Employee Codes.
- Enter an Employee ID.
- Enter a Rate Class. The Union Code field automatically defaults to the union code associated with that rate class.
- Enter a Federal Classification Code.
- Choose Save. You can also assign a rate class to an employee in the following ways:
- Assign a rate class to a job that an employee is associated with. This overrides the rate class in the Employee Maintenance Codes window. See Assign rate classes to jobs.
- Assign the rate class to payroll transactions. The rate class is assigned to the employee for that transaction only, and overrides the rate class assigned in the Job Maintenance and Employee Maintenance Codes windows.
Step 5:
Assign rate classes to jobsAnchor job_cost_setting_up_rate_classes_1076 job_cost_setting_up_rate_classes_1076
You can assign one rate class for each job. The rate class entered in the Job Maintenance window overrides the rate class in the Employee Maintenance Codes window.
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In a union environment companies are faced with complex methods to determine the rate of pay for an employee. In addition to specific wage rates based on the worker's experience level and classification within a union, the location of the work and the employee's relationship with the company can become a factor.
There There are cases where the locality should dictate the rate for an employee, where the scale rate in the home union should dictate the rate, and cases where the employee is paid a rate above both of these.
This This features helps the scenario where the worker gets paid the highest rate. For example, the employee's home union might be Milwaukee, but could work temporarily on a job in Appleton. The Milwaukee union's pay rate is higher than Appleton's, hence, for incentive or other reasons, the Milwaukee union might agree to pay the employee their higher home rate.
If If your company supports similar over-scale scenarios, follow the steps below to implement this feature into your payroll system. This feature supports payroll transactions created in Payroll Transaction Entry in Microsoft Dynamics GP and in Time Track.
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- Rate class for employee's union
- Rate class assigned to the job
- Employee personal rate (pay code)
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The highest pay rate feature applies only to pay rates, NOT to benefits and deductions. |
Setup requirements
To set the system to use the highest pay rate, you must mark the check box Use higher pay rate, for ALL rate class groups, in the Rate Class Setup window.
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On union reports, the union code that will display is the union that the employee worked with while on the job. On the Employee Union report, you will see the employee's home union and the union from the job.
Example:
Employee works on a job for a different union local, and has been approved to get paid the higher rate, which happens to be his home union local.
This This example uses TimeTrack for payroll transactions.
Employee, WILLIE GREEN, is working on a job for the Sheet Metal Local Appleton union. His home union is Milwaukee, and he is performing the same duties in Appleton as does in his home union. In spirit of reciprocity, the Appleton local has agreed to pay Willie his home rate, which is the higher rate of the two unions.
For purposes of this example, we will assume that the Use higher pay rate check box has been marked for all rate classes in the Job Cost system. This example uses TimeTrack.
Pay rates:
Our fictitious system is set up with the following pay rates:
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The following diagram shows how the system calculates the pay rate involving prevailing wage and fringe amounts. Pay rate includes any cash fringe that may be due to the employee.
Example scenarios - prevailing wage and benefits
This section contains example scenarios to illustrate how prevailing wage and fringe benefits are calculated, including cash fringe, if applicable.
The Employee Standard rate in the examples below is the highest rate, taken from one of the following:
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This window is used to enter wage rate and fringe rate information from the government-supplied wage determination sheet. Information is based on the union, county and Standard Occupational Code (Fed Class Code). Fringe rate is an hourly accumulation of all the fringe benefits paid to a typical employee in a classification (union or non-union).
Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup > Prevailing Wage and Fringe Rate.
- Rate ClassChoose : Choose the rate class for which you will be entering wage and fringe rates.
- Union CodeThis : This can be any union; it does not have to be assigned to the selected rate class in the Rate Class Detail window. This field is NOT required for non-union contractors.
- Start DateEnter : Enter a starting date for entering wage and fringe rates in this window. The default is the user date.
- Filter DateUse : Use this field to filter the wage/fringe rate entries that appear in the window. Wage/fringe rate entries appear only if this Filter Date falls within the start and end dates of the entry. If there are multiple entries (rows) for the same federal classification, but with different start dates, only the most recent entry will appear, assuming the Filter Date falls within the date range of the entry.
- Federal ClassificationSometimes : Sometimes referred to as the Standard Occupational Code.
- Rates (straight time, overtime, and double time)Enter : Enter the wage rate for straight time, as supplied on the wage determination sheet. The overtime and double time are calculated automatically; you can change these amounts, if necessary.
- Fringes (straight time, overtime, and double time)Enter : Enter the fringe rates for straight time, overtime, and double time - as supplied on the wage determination sheet. This will be an accumulated amount of several benefit categories. The default for overtime and double time is the same as straight time, however, you can override these defaults.
- Start DateThe : The date that the wages for this federal classification code takes effect for this employee.
- End DateThe : The system automatically fills in an end date as soon as you create a subsequent entry for the same federal classification code with a different start date (you cannot enter a date manually). For example, if wages for a fed code go into effect on 1/10/2010, but will increase on 6/1/2010, as soon as you enter the wage line for 6/1/2010, the End Date for the previous entry will be set to a day before, in this case, 5/30/2010.
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This window is used to enter and manage fringe benefits paid to each employee, including a start (effective) date. The standard benefits entered in this window are compared to prevailing fringe benefits, based on the information from the government-supplied Davis-Bacon Act (DBA) wage determination sheet.
Note: If you want the correct prevailing wage amount to default into Time Card Entry, you must set up at least one default benefit in this window, even if the fringe amount is zero.
Microsoft Dynamics GP > Tools > Setup > Job Cost > Payroll Setup> Employee Fringe
- Employee IDThis : This employee must be set up in the Employee Maintenance Code window in Job Cost.
- NameFills : Fills automatically based on employee ID.
- Start DateEnter : Enter a starting date for entering fringe benefits. If no date is entered, today's date is used.
- Filter DateUse : Use this field to filter the fringe rates that appear in the window. Fringe benefits appear only if this Filter Date falls within the start and end dates of the benefit.
- BenefitYou : You can choose existing benefits, one by one, using the lookup (same lookup accessed through the Payroll module) - OR - you can create one benefit that is an accumulation of the individual benefits for this employee. You can give your own name to this new benefit; it does not have to be an existing benefit name. If you choose benefits individually, the system will add up the total automatically. If you already know the total benefit amount for this employee, you can create one new benefit name and enter the total in one line.
- Start DateThe : The date that the benefit takes effect for this employee.
- End DateThe : The system automatically fills in an end date as soon as you create a subsequent entry for the same benefit code with a different start date (you cannot enter a date manually). For example, if benefit code H&W goes into effect on 1/10/2010, and will increase on 6/1/2010, as soon as you enter the benefit line for 6/1/2010, the End Date for the previous entry will be set to a day before, in this case, 5/30/2010.
- Fringe (straight time, over time, and double time)Enter : Enter the fringe rates for straight time, overtime, and double time - as supplied on the wage determination sheet. This can be an accumulated amount of several benefit categories (see Benefit above).
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