1. Using Project Costing
  2. Organization Labor Schedules

Organization Labor Schedules

Use organization labor schedules to efficiently distribute payroll costs to projects for groups of employees by creating labor schedules based on your organizational hierarchy, ensuring immediate cost capture upon payroll processing.

Organization labor schedules enable you to:

  • Easily distribute payroll costs for an entire department to a specific project, set of projects, or the ledger using non-project labor costs. For example, you can create labor schedules that send all R&D staff costs to Internal Research Projects.
  • Apply a consistent cost distribution rule for all employees across an entire business unit, ensuring all payroll costs are sent to Projects for distribution.
  • Distribute costs for large divisions or groups of related departments using the Include Child Nodes option, reducing the need for numerous individual schedules.
  • Ensure immediate initial distribution of payroll costs to projects via time cards, reducing delays in capturing labor costs.

Example Scenario: Centralized IT Department Costing

Vision Operations has a large central IT department, called Corporate IT, that provides support and develops internal tools for various projects across multiple business units, such as EMEA Sales, North America Operations, APAC Research, and so on. Currently, after every payroll cycle, their project accountants have to manually create or adjust labor schedules for individual IT employees to allocate their payroll costs to the correct projects. This is time-consuming, prone to errors, and delays accurate project cost reporting.

Instead of managing hundreds of individual labor schedules for each IT staff member, Vision Operations can create one or a few organizational labor schedules for the Corporate IT department.

How this works

Task Description
One-Time Setup
  1. A Labor Distribution Administrator creates a new organization labor schedule.
  2. They select the Corporate IT department within their primary business unit Global IT & Infrastructure.
  3. They set up a rule as follows:
    • Rule 1: 70% of Corporate IT payroll costs go to Project X: Core Infrastructure Maintenance (an internal project).
    • Rule 2: 30% of Corporate IT payroll costs go to Project Y: New Tools Development (another internal project).
  4. They then set this schedule to Active.
Payroll Processing and Cost Transfer (Ongoing, Automated)
  1. At the end of the month, Oracle Fusion Payroll processes salaries for all Corporate IT employees.
  2. During the scheduled run of the Import Payroll Costs process, these payroll costs are picked up from Oracle Fusion Payroll or your Third-Party Payroll Import.
  3. Immediately upon running the monthly import of payroll costs to projects process, the system identifies these payroll costs as belonging to the Corporate IT department.
  4. It then finds the active Organization Labor Schedule for Corporate IT.
  5. Based on the defined rules, it automatically distributes the gross payroll costs for all Corporate IT employees: 70% is earmarked for Project X and 30% for Project Y.
  6. They are then transferred and recorded as actual labor costs directly into Project X and Project Y within Project Costing.
Outcome / Benefit
  • Vision Operations' project accountants no longer need to manually manage schedules for each IT employee.
  • The initial distribution of payroll costs for the entire Corporate IT department is automated, ensuring costs are captured in projects much faster and with greater accuracy, significantly reducing administrative overhead and improving project financial reporting.

Reporting and Analysis in OTBI

  • OTBI includes organization labor schedule attributes in existing subject areas, enabling reporting by Business Unit and Department for organization labor schedules.
  • Use these subject areas for organization labor schedule analysis:
    • Projects – Labor Schedule Analysis Real Time
    • Projects – Labor Distribution Cost Analysis Real Time
  • Example analyses:
    • Coverage by Department and Business Unit: Identify which departments within each business unit have active organization labor schedules and which don’t.
    • Future schedule gaps: Find organization labor schedules ending in the next 30/60/90 days with no succeeding version to prevent cost distribution delays and late charging.
    • Exception prevention: Trend the count of payroll distribution exceptions correlated with departments or business units lacking coverage or with expiring schedules.
  • Access: See duty roles for subject areas under Creating Labor Distribution Data Analyses Using OTBI.