Labor distribution identifies where your payroll dollars are spent by charging your employees' time to specific "cost accounts." These cost accounts will vary from business to business and can be as broad or specific as your needs dictate.
Examples
| Broad Cost Accounts |
Cost Center, Line, Department, Location, Division |
| Specific Cost Accounts |
Jobs, Projects, Activity, and Machines |
Tracking labor distribution sounds simple: ensure that all of your employees' time is properly allocated to the correct accounts. But there are questions that will arise. For example: "What if I have employees working on multiple projects simultaneously?" and "What hourly value do I assign to my salaried employees' time?" Answering these questions will ultimately fall to your Time and Attendance system.
Unfortunately, most Time and Attendance applications are unable to calculate for these complex rules. They can track labor distribution for hourly employees working on a single cost center because it only requires a simple formula. Handling complex labor distribution should be a core capability for your Time and Attendance system.
Labor distribution gives visibility to what your employees are working on and whether their activities are profitable or not. It serves as a valuable tool for calculating payroll and monitoring costs.
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