Understanding Job Cost

A job's real cost needs to include additional labor costs like topups, paid rest breaks and holidays. These were previously only known when you ran payroll as they depend on the average hourly rates for each employee.

The Cost section on each job provides you with a breakdown of additional labor costs by running these payroll period calculations for you.

What does "Estimated costs" mean?

Labor costs are subject to change until the payroll period is complete. Any new job that gets added may affect the average rates for employees, and therefore the topups, paid rest breaks, etc.

Jobs that are within an incomplete payroll payroll period will have a message to let you know the costs are not yet confirmed. An example of an in-progress job is where the job is from Wednesday, today is Thursday and your payroll period is Monday-Sunday.

How it works

We assess all jobs within your payroll period window and look at each employee's average hourly rate for contract work. From this we can calculate the topups (if any), paid rest breaks (if any) holiday costs that need to be incorporated to the job cost.

The exact calculations depend on your organisation settings. You can view these in the main menu under Account > Organisation.

Topups

When an employee's average hourly rate (for contract work) for the payroll period is below minimum wage they will require an hourly rate topup.

In some cases a job's topups will be negative. This can happen when one or more of the job's employees were topped-up, but they were over minimum wage for this particular job.

For example:

• Bob works on 5 8-hour contract jobs over one week:
  • Monday 8 hours at $20 p/h,
  • Tuesday 8 hours at $20 p/h,
  • Wednesday 8 hours at $15 p/h,
  • Thursday 8 hours at $10 p/h and
  • Friday 8 hours at $15 p/h.
• His average contract hourly rate is $16 p/h.
• He requires $1.70 p/h to achieve the current minimum wage of $17.70.
• The topup cost for Bob on each job is calculated as follows:
  • Monday
    • Base cost = 8 x 20 = $160
    • Topup = 8 x (17.7 - 20) = -$18.40
  • Tuesday
    • Base cost = 8 x 20 = $160
    • Topup = 8 x (17.7 - 20) = -$18.40
  • Wednesday
    • Base cost = 8 x 15 = $120
    • Topup = 8 x (17.7 - 15) = $21.60
  • Thursday
    • Base cost = 8 x 10 = $80
    • Topup = 8 x (17.7 - 10) = $61.60
  • Friday
    • Base cost = 8 x 15 = $120
    • Topup = 8 x (17.7 - 15) = $21.60

Related articles

• Page:
  Paid rest break calculations
• Page:
  Job cost calculations
• Page:
  Divisons