Calculating and Entering Overtime
After you completely set up your projects to collect overtime, you need to calculate overtime hours and enter them in Oracle Projects.
You calculate overtime hours and charge the hours to your overtime project using one of the following methods:
- Manually calculate overtime hours and charge them to your indirect project.
- Use a client extension or use the labor client extensions to calculate and charge the hours to your projects automatically.
Attention: You need to specify an overtime calculation method using the Implementation Options window during your implementation of Oracle Projects. See: Implementation Options.
Manual overtime calculation and entry
You can manually enter overtime hours along with straight time hours using the Expenditure Batches window.
When a timecard clerk enters pre-approved timecards, the clerk calculates an employee's overtime manually based on company overtime policies and the employee's compensation rule.
The clerk charges an employee's overtime hours to the overtime project and appropriate overtime task using an expenditure type that is classified with a expenditure type class of Overtime.
For example, suppose Pat Miller, a compensated employee turns in the timecard shown in the following table:
|
|
|
|
|
| Employee Name: Pat Miller
| Number: 1030
| Organization:
Structural
|
| Project/Task Number:
TM4/1.0
| Project/Task Name:
Engineering Survey/Collect Data
|
|
| Day
| Date
| Hours
| Total Hours
|
|
| Monday
| April 18
| 8
| Total Hours
|
| Tuesday
| April 19
| 9
|
| Wednesday
| April 20
| 10
|
| Thursday
| April 21
| 10
|
| Friday
| April 22
| 8
|
| Saturday
| April 23
| 7
|
| Sunday
| April 24
|
| 52
|
According to Fremont Corporation's policy, Miller is entitled to time and a half overtime for the first 40 hours she works beyond 40 hours per week. When the accounting department enters Miller's timecard into Oracle Projects, a clerk enters the following two timecard lines:
- 52 hours of straight time charged to the engineering survey project
- 12 hours of overtime charged to the overtime project, Time and Half task
The first line records 52 hours of straight time labor cost charged to the engineering survey project, which is costed using Miller's hourly labor cost rate.
Note: Fremont Corporation enters summary timecards for the expenditure week. They do not enter daily timecard lines.
The second line accounts for the overtime premium Fremont pays Miller for her overtime hours. The 12 overtime hours are charged to Fremont's indirect project, Time and Half task; the task's labor cost multiplier (0.5) calculates half Miller's labor cost rate.
A few things to note about manual entry of overtime in the Expenditure Batches window are:
- The expenditure item date can be set in two different ways, depending upon whether overtime is calculated for the week or a day. Generally, overtime is calculated for the week, so the clerk sets the expenditure item date of the overtime item to the week ending date. If overtime is calculated based on daily hours, the clerk can enter the overtime for each day or can summarize the overtime and enter the total overtime hours with a date of the end of the week. This is a company policy decision, but it is recommended that you enter overtime with the week ending date to reduce the number of overtime entries.
- After the clerk selects an Overtime expenditure type, the project and task default from the overtime project and task specified for the employee's compensation rule. You can override these values.
- Oracle Projects calculates the cost of the expenditure item using the labor cost multiplier that is assigned to the overtime task to which it is charged.
- All expenditure item dates must be within the expenditure week ending date of the timecard.
Employees who enter their own timecards in Oracle Personal Time and Expense cannot manually enter overtime. Timecard clerks calculate overtime based on timecards entered by employees, then enter the overtime hours using the Expenditure Batches window.
Automatic overtime calculation and entry
You can use the Overtime Calculation extension or labor client extensions to automatically calculate and charge all overtime hours to the project and tasks you specify according to your business policies.
Unlike manual overtime calculation, in which you calculate and enter overtime hours when you enter timecards, you can use automatic overtime calculation to calculate and charge overtime hours to a project and task when your accounting department distributes labor costs. Employees and timecard clerks, thus, enter only straight time hours.
Using the example, above, but this time using automatic overtime calculation, if Pat Miller works 52 hours on an engineering survey, the clerk in the accounting department enters only one line:
- 52 hours of time charged to the engineering survey project
When the accounting department distributes labor costs, the PRC: Distribute Labor Costs process runs the Overtime Calculation extension, or the labor client extension which automatically calculates overtime hours, and creates the following new expenditure item in a new expenditure and expenditure batch:
- 12 hours charged to the overtime project, Time and Half task
Oracle Projects uses two expenditure items to process Miller's labor cost whether you use manual or automatic overtime calculation; the difference is how and when the overtime items are calculated and entered.
See Also
Labor Costing Extensions
Labor Transaction Extensions
