Understanding AAIs for Burden and Premium Labor Distribution

You set up AAIs to define accounts for actual burden, flat burden, and premium time transactions for labor distribution. You can select a hierarchy method that controls the search criteria by which the system searches for accounts.

You can set up AAIs separately for each company. The system searches first for a specific company. If it finds no instructions for the specific company, it searches for Company 00000. Always set up generic instructions in Company 00000.

Burden is defined as the direct expenses that a company incurs for an employee in addition to wages. These expenses include:

• Payroll taxes and insurance (PTI) - Company-paid taxes and insurance, such as workers compensation insurance

• Fringe benefits - Company-paid benefits, such as health insurance and company contributions to a 401(k) or RRSP plan

This table provides information that you should consider before you set up AAIs that are associated with burden:

Considerations	Additional Information
Flat burden:	Is an estimate that is a predetermined percentage of an employee's gross wages. This estimate is approximate to actual burden costs. Distributes the expense in the same amount throughout the entire year. Can be calculated per employee, union, or business unit for each timecard during time entry. Is not calculated for lump sum amounts. Is a median calculation of actual burden for the year.
Actual burden:	Is heavier at the beginning of the year until limits are reached. Examples in the U.S. are FICA, FUI, SUI, and SDI. Can be turned on and off by company to complete the calculation.
Burden considerations for Time and Labor	Time and Labor calculates flat burden instead of actual burden. When you set up flat burden distribution debit instructions, you must, at a minimum, include the FB (Flat Burden) journal type code. When you set up premium labor debit instructions, you must, at a minimum, include the PR (Payroll premium labor distribution) journal type code. You can specify whether the system splits the premium portion of overtime and creates separate journal entries for straight time versus premium time. When you set up actual burden distribution debit instructions, you must, at a minimum, include these default journal type codes: BF: Burden fringe benefits for actual burden Use this journal type for the burden fringe benefits that you do not want to distribute separately. The system uses the account number associated with this journal type when it does not find an entry for a specific fringe benefit. BT: Burden taxes for actual burden Use this journal type for the burden taxes that you do not want to distribute separately. The system uses the account number associated with this journal type when it does not find an entry for a specific tax.