Labor Phases provide a number of functions throughout the software. First, we’ll discuss their various uses. Then we’ll look at setting them up.
Labor on Items: Each item can have an associated labor phase and time set up on the Item Master. Let’s assume a television costs $750 and we include 30 minutes of install time when sold to a customer. If you have a labor phase called Install and your labor price is $100 per hour, the installed price of the television will be $800, $750 TV + $50 Install. Including labor phases and times on items expedites the calculation of labor on the proposals you create.
Filter Lists: Since all items are associated with a labor phase, lists of items can be filtered and sorted using their phase on proposals, sales orders, work orders, and purchase orders. So, for example, you could create a list of prewire tasks based on the parts that have the labor phase of Prewire. Or you could choose to display a list of trim parts on a work order by filtering the parts’ labor phase.
Labor Only Work: All labor phases are automatically created as labor items as well. This is helpful when you want to add more time to a job above and beyond the labor associated with the items you sold. If the job you are quoting needs some extra programming time for the customer’s automation system, you can simply type the labor phase “Programming” on the proposal or invoice. If programming is charged at $150 an hour, you can put quantity 6 of Programming to add a $900 charge to the customer.
Time Tracking: As technicians check-in to work orders they will be asked to select a labor phase to aid in tracking their time. This will help distinguish between time spent on prewire and time working on final installation, for example. Labor phases can also be used to track sales and design & engineering time on proposals and sales orders as well.
Reporting: Job cost reports can indicate the amount of time sold versus the actual time used. Since the actual cost of labor (payroll) is entered into QuickBooks as a payable and not entered into iPoint, the software uses the labor cost entered on labor phases to calculate the labor portion of job costs.
Tie to QuickBooks Payroll: If you utilize QuickBooks to process your payroll, labor phases are used to tie labor to their corresponding QuickBooks counterparts.
Now that you understand the significance of labor phases in iPoint, let us look at how to set them up.
- The blue New Labor Phase button is used to send your accounting team on an all-expense-paid trip to Europe! Just kidding. It creates a new, blank labor phase.
- Now type the name of your labor phase in the Labor Phase field.
- When you tab out of the labor phase field, it will be placed in the list of labor phases, at the bottom of the screen, in alphabetical order. Or, if your list is numbered, the new labor phases will be shown at the top of your list.
- Click in the Labor Cost field to enter the average cost of this labor phase. Keep in mind this is generally an average cost. You might have two technicians, for example. Your senior technician is paid $28.75 per hour and your junior tech is paid $15.80. If both of your techs work the same amount of time, you might put a cost of $22.27 (the average of your two technicians.) Or, you might include burdened labor costs here, including benefits, the cost of van maintenance, and training expenses.
- In the Labor Price field, enter the price you sell this labor phase for.
- The Labor Margin field will automatically calculate the margin.
- If you are using QuickBooks Payroll, you will want to associate each labor phase with a QuickBooks Wage Item. Choose the QuickBooks Wage Item from the drop-down menu on each phase. Note: The drop-down QB Wage Item field is activated in Settings > Module Settings > Work Orders > Sync Work Order Time With QuickBooks.
Taxable: A check in this box will cause iPoint to calculate sales tax for this phase. Sales tax will be based on the sales tax defined on the proposal, sales order, or invoice.
Hide on WO & Project: By default, all labor phases are available for your technicians to select on a work order or project. However, you may have included an Engineering labor phase that is not performed by your techs. Placing a check in this box will keep the labor phase from being visible on work orders or projects.
Hide on Proposal/SO: iPoint can track the amount of time a project manager or engineer spends on the creation and execution of jobs. Checking this box will exclude the particular labor phase from appearing in the check-in options on proposals and sales orders.
Default Not Billable: As time entries are utilized in projects and work orders, they can automatically be applied to invoices and billed at the appropriate labor price. Placing a check in this box will cause the labor rate to be calculated at $0 per hour. The time will still display, but the customer won’t be charged. This is useful if you have a Warranty labor rate, for example.
Omit From SO Time Calcs: This option excludes the selected labor phase from being included in sales order project time calculations. (Sales Order > Project) If you are updating a pre-existing labor phase you will be prompted to update previously entered time entries with this phase or just new uses of this labor phase.
Omit From Prevailing Wage: Any labor phase can be used as a prevailing wage item. Placing a checkmark in this box will cause that labor phase not to be selectable to use on a Project.
Archive: If you have a labor phase you no longer want to use, a check-in this box will remove it from selection anywhere in iPoint. We don’t delete it altogether, because the labor phase is likely tied to historical time entries and sales. Deleting it would cause us to lose history and could cause transactions to be out of balance. Clicking this box will also hide the phase from the Labor Phase list.
- The Sort Order field allows you to organize the labor phases in any order you wish. Place a number in the fields to sort phases numerically. If two phases have the same number, they will be sorted alphabetically. Enter the number 3.5 to move a labor phase between phases 3 and 4.
- QuickBooks Wage Item dropdown field is only used if you are using QuickBooks payroll. From the dropdown list, pick the corresponding wage item in QB. Then, when you sync time entries in Settings > QuickBooks > Time the transactions will match their corresponding in the accounting software. Wage Items are set up in QuickBooks and synced to iPoint during the chart of accounts sync in Settings > QuickBooks > Chart of Accounts sync.
- The View Item button opens the matching item in the items module so you can adjust things like QuickBooks accounts and descriptions.
At the top of the Labor Phases window are three buttons.
- Show Archived will display any archived labor phases as well as the active ones. This is a toggle button and will show Hide Archived so you can re-hide the archived phases.
- Sort ABC will sort the labor phases alphabetically and then renumber them so that they appear in alphabetical order.
- Refresh Sort forces the software to update the order based on the manually entered sort numbers.