Our new Pay Rate Engine was built for our Australian customers to help meet their more intricate Overtime and Pay Rate needs that our regular settings don’t provide, but it can be added to any account. Here are some notes for setting up this add-on.
- To get the Pay Rate Engine:
- Feature Add-ons > Manage Add-ons > Pay Rate Engine > Install
- OR Company Settings > Payroll & Overtime > Overtime > Use Pay Rate Engine
- All Overtime settings must be set up using the Pay Rate Engine after it is added to the account. The Overtime tab will still be in the Advanced section of the Company Settings, but only contains a link to “Manage Pay Rates”.
- Integrations: Rule of thumb - the PRE is not compatible if the integration does not offer Payroll Item Mapping (Gusto, ADP, etc.). Those that use payroll item mapping (Xero, QBD/O) will require each rule to be mapped to the appropriate overtime pay item
- If QuickBooks is integrated, map payroll items as normal in the Payroll Item Mapping Tool, but you will notice that Overtime options are missing. Click “Open Pay Rate Engine” at the top to adjust the Overtime mapping within the rules themselves.
- If the customer is using complex payroll Item mapping (by customer or service item), each overtime setting and its rules will display for the chosen items. They can be mapped here.
- If Xero is integrated to the account, the Pay Rate Engine will have a Pay Item Mapping option in each Overtime Rule (“Xero Pay Item”), so the correct pay item is linked with the hours when exporting time.
- The pay items in Xero must be categorized as "Overtime Earnings Category" to appear in the Pay Rate Engine.
- Compatible Reports:
- Wage Report, Job Costing Report, Approvals Report, and Payroll Report
- Downfalls: the new OT rules are not color-coded in the Approvals or Payroll, just displays as one whole OT bucket. To view the OT rules, open the team member details on these reports.
- Not compatible with Comp Time
- When and how are rules applied? (conflicting or overlapping rules):
- We can only apply one rule to any given timesheet. Overtime rules only apply to regular time (not other overtime, not time off, not breaks). Once a timesheet is marked as “overtime”, it won’t be read by any other rule.
- Daily, Consecutive Days, Time of Day, and Holiday rules are all calculated on the day the timesheet is created. Among these types of rules, the highest multiplier/rate (aka whichever gets them more $$) will be applied at the end of the day.
- Note that shift differential or holiday hours are counted as “overtime” in our system, even if they are technically not. So if one of these rules is applied to time first, no other rule will be applied.
- Notes on Time of Day setting:
- Check Allow shift to run late if the rate should continue to be applied even after the specified end time as long as the team member remains clocked in.
- If a shift was started 10 minutes or more before the Time of Day rule and the Allow shift to run late is checked, then the Time of Day overtime rule will not apply to that shift.
- Weekly overtime does not calculate until there are 40 hours of regular time worked (or however many hours they have set for weekly). However, daily overtime will have precedence over weekly rules, including on the final day(s) of the week.
- e.g., A week that looks like 8, 8, 8, 8, 9 will get 1 hour daily overtime.
- The Rate Multiplier should NEVER be set to 1x. If it is set to 1x, the rule will be completely ignored. The multiplier must be at LEAST 1.01x in order for the rule to be recognized and applied to timesheets.
- We can only apply one rule to any given timesheet. Overtime rules only apply to regular time (not other overtime, not time off, not breaks). Once a timesheet is marked as “overtime”, it won’t be read by any other rule.
- This means that overtime rules cannot be stacked – one timesheet cannot be associated to multiple overtime rates. For example, a timesheet cannot be both shift differential and weekly overtime. It will be one or the other.
- It also means overtime cannot be pyramided (yes, that's a word). In other words, only REGULAR time counts toward overtime. Daily overtime does not count toward weekly overtime, just like time off does not count toward overtime.
Example Scenario Rules:
Regular
Daily- over 8hrs/day at 1.5x
Holiday- Monday at 1.15x
Time of Day- 8pm-8am at 2x
Weekly- over 40hrs/week at 1.25x
Sunday: 12pm-4pm = 4 hours
Sunday is4 regular hours
Monday: 1pm-9pm = 8 hours
Monday was a holiday and 8pm-9pm fell into the Time of Day rule at 2x. Because that rule was higher, it was applied. Therefore,7 hours at 1.15xand1 hour at 2x
Tuesday: 8am-4pm = 8 hours
Tuesday is8 regular hours
Wednesday: 8am-4pm = 8 hours
Wednesday is8 regular hours
Thursday: 9am-6pm = 9 hours
Thursday fell past the daily limit of 8 hours Therefore,8 regular hoursand1 hour at 1.5x
Friday: 8am-4pm = 8 hours
Friday is8 regular hours
Saturday: 12pm-9pm = 9 hours
If you count all regular hours so far, you’ll see we’re at 36 regular hours for the week. So we still have regular hours to count in this day, until we hit the weekly overtime of 40. That means there are 4 regular hours. With the remaining 5 hours, we allocate those to weekly overtime, with the exception of the hour worked between 8 and 9pm. So we have4 hours at 1.25xand1 hour at 2x. Because Time of Day rule was higher, it was applied. (If weekly had been higher, it would have applied, only because it would have won, once it saw the over 40 hours.)
