Segmentation
Labour rates can be determined based on segmentation. You can set primary and secondary segmentation, and labour rates can be configured accordingly.
Segmentations have four categories:
Job description
Job priority
Business unit
User group
▶️ Labour rates
Based on the chosen Primary segmentation, the other three categories will be available for Secondary segmentation.
In the example below, I've selected 'Job description' as the Primary segmentation and 'Job priority' as the Secondary segmentation.
If you choose a specific job description and priority and set the labour rate, it will only apply to that particular job description and priority.
If you choose 'Any' under Primary and Secondary segmentation, the configured labour rates will apply to all job descriptions and priorities.
If a specific job description is chosen and 'Any' is chosen for secondary segmentation, the labour rates will apply to that specific job description and all priorities.
The above logic will apply to all the primary and secondary segmentation.
Labour rates:
The labour rate template should be configured to the job description.
When setting up a 'Job description' in Settings, assign the 'Labour rates' template and create a contract for that specific job description.
Price book:
Price books are tailored to individual customers and must be assigned to them.
If a customer has a designated price book, the labour rate template set for the job description must also be in the price book.
Adjustments on timing for contract & advanced labour rates
If the contract template sets the time from Monday 12 AM to 11.45 PM, what happens if the task extends 15 mins and it occurs from Monday 12 AM till Tuesday 12 AM?
The system will still apply the labour rate of 60 pounds per hour, even though the timing is set from 12 AM to 11.45 PM. In this case, 11.45 PM will be considered as 12 AM.
How do labour rates work in contracts?
This article explains how labor rates are calculated within contractual agreements to provide clarity on the process and factors involved. You'll learn about the mechanisms used to determine, apply, and manage labor rates, as well as the key factors that influence these calculations.
If the labour rates does not match with any of the settings, then the labour rates for that particular job will be considered as zero.
Labour rates settings
There are a few settings available to determine how labour rates will be calculated for contract jobs. The system will consider the labour rates in the below order.
Contract template > Step 5: Billable rates > Labour
Price books (or)
Labour rates
Users
To use price books, the labour rates will be picked from multiple labour rate settings. Created job descriptions should be linked with a labour rate templates. so then the price books or labour rates price can match
To use labour rates from the 'Labour rates' template, it must be assigned to the specific 'Job description,' and a contract for that job description must be created.
Contract template > Step 5: Billable rates > Labour
The system will first consider the labour rates from the contract template. If the labour rates match, then invoice will be raised based on the rates given in contract template.
Here are the labour rates set up in the contract template above:
From Monday to Friday, between 8 AM and 5 PM, the labour rates will be £30 per hour.
On Saturdays and Sundays, from 8 AM to 9 PM, the labour rates will be £40 per hour.
If a job is created during a UK public holiday, the labour rates will be £60 per hour.
Scenario 1:
When creating a job for this contract with the timing set from 4 PM to 9 PM on Tuesday, how are labour rates calculated?
Between 4 PM and 5 PM, the labour rate of £30 will be sourced from the contract template.
From 5 PM to 9 PM, it will first check 'Price books'.
If a price book is assigned to the customer and the labour rate templates assigned in JD configured here, labour rates will be taken from the Price book. It will first check the available time slots in advanced labour rates. If no price is available from the slots, then it will take the Basic rate mentioned in the template.
If no price book is assigned, it will then check 'Labour rates' based on the job description. It will first check the available time slots in advanced labour rates. If no price is available from the slots, then it will take the Basic rate mentioned in the template.
If no rate is found, the system will consider the 'sale rate' in the 'Users' settings.
Scenario 2:
Create a new job and assign it to an engineer and that day falls on a UK public holiday. Job scheduled from Monday 12 AM till tuesday 12 AM.
In this case, labour rates for the job will first consider the contract template. In the template, timing configured is from 12 AM till 11.45 PM. In this case, the system will consider 12 AM - 11.45 PM as 12 AM -12 AM only. The timing will get rounded and labour rates will be calculated as 60 pounds per hour.
Scenario 3:
Create a new job and assign it to an engineer. If it falls on a UK public holiday, specifically Thursday, and the job is scheduled from 12 AM to 11 PM, but the contract template from and to time has been set as for 'public holiday' as 12 AM to 9 PM.
In this case, labour rates for 12 AM to 9 PM will be determined by the contract template's rates for UK public holidays.
From 9 PM to 11 PM, labour rates from other applicable days in the contract template, even if set for Thursday, won't be used. Instead, the system will consider 'Price books' or 'labour rates', or 'Users'.
Note: If the contract template does not include a 'Public holiday' setup and a job is created on a public holiday, that day will be treated as a regular day, and labour rates will be calculated as they are for other days.
Price books
If the job timing doesn't match the contract template, the system will next consider the labour rates from the price books.
In this case, the system will first look for 'Advanced labour rates'. If they match the timing, those rates will be used; otherwise, it defaults to the 'Basic rate'. No additional checks will be made in the 'Labour rates' or 'Users' settings.
In scenario 1, labour rates from 5 PM to 8 PM will be determined based on the price book set at £59, if this price book is allocated to the customer.
Note: If the labour rate template set for the job description isn't in the price book, then the system will ignore the price book assigned for the customer and it will next move to the “Labour rates” template.
Labour rates
If the job timing doesn't match the contract template and no price book is assigned to the customer, the system will then use the 'Labour rates' settings.
The labour rate template should be configured to the job description.
When setting up a 'Job description' in Settings, assign the 'Labour rates' template and create a contract for that specific job description. If done, the system will first check for 'Advanced labour rates'. If the timing matches, it will use that rate; otherwise, it will default to the 'Basic rate'. There won't be any further checks in 'Users' settings.
Users
This is the final option to check for labour rates.
If labour rates cannot be obtained from the contract template, price books, or labour rates, then the system will check the sale rate in the job-assigned engineer's profile.
If the 'Sale rate' is available in the business details, then the labour rate will be calculated based on that.
If not, then the job's labour rate will be considered zero.
Note: If the total working time is 5 hours and labour rates are calculated from the contract template and price book, each labour line item will display the total working hours when added to the invoice.
What happens if the contract billable or labour rates have duplicate time slots?
In case we have duplicate slots, the system will consider the first slot.
Contract
In the new contract, we won’t allow duplicate slots. But in the current contract, we don't have validation to check the duplicate slot.
Note: In case any clients have duplicate slots, they have to delete the slots manually in contract template settings and also in all customer contracts
In the screenshot below, Labour rates are set from Monday to Friday, 8 AM to 12 PM, at £20/hr.
Additionally, for the same time slot, another labour rate is set at £25/hr.
With our new improvement, the system will now only consider the first time slot with the labour rate of £20.
Advanced labour rates
Labour rate 1 is configured against the “JD” job description
The base rate is set as £40 per hour
Scenario
Job description: JD
Diary event: 11AM - 3PM
Line item 1: Time matches in the contract template from 11AM-12PM and picks the first slot. It will ignore the second duplicate slot.
Line item 2: Time matches in advanced labour rates from 12PM-2PM and ignores the second duplicate slot.
Line item 3: Time does not match advanced labour rates, so it will consider the basic rate.
Add a new job and schedule a diary event
Once a contract template is assigned to a customer, add a new contract job and create a diary event for an engineer/technician.
Based on the engineer/technician job start and end time logging in mobile, the labour rates will be calculated.