A result of reclassifying the excess regular hours, is the creation of a new overhead expense equal to the amount of each employee's Overtime Premium Pay. For example, assume an employee making $20 per hour had 8 excess regular hours in the period. The overtime premium would be computed as follows ...
($20 x 8 hours x 1.5) - ($20 x 8 hours) = $80.
The modified Compute Payroll process now takes the Overtime Premium Pay and distributes it across the various non-overhead jobs charged during the period. Using the above example, assume the employee worked 33 hours on Direct Job A, 11 hours on Direct Job B and 4 hours on an Overhead Job. Using the 44 (33 + 11) direct hours as a base, the OT Premium would get allocated as follows ...
Job A: $80 x (33 / 44) = $60
Job B: $80 x (11 / 44) = $20
NOTE: The actual distribution is made by Job, Cost Code, Billing Item, Cost Category, Labor Rate, Earnings Group, Pay Type, GL Entity, Work Order and Date Worked.
See Start Compute Overtime , Registry Start Compute Overtime and Compute Payroll for additional information.
See Compute Overtime - No Checks Printed or Posted for details/additional registries for computing overtime when checks will not be generated.