Prevailing Wage rate agreements provide capabilities to define and configure
rules for calculating wage rates depending on minimum wages imposed by local
authorities on different jobs related to work orders, service orders or other
project related tasks.
To support prevailing wage rate calculations you
need to set up Prevailing Wage Rate Agreements, job parameters and shortfall
definition.
'Use Prevailing Wage' in the rate agreement is dependent on the Job Cost Category. The usual case would be to have Categories defined as 'Prevailing wage', 'Union', 'Benefits' etc. where Prevailing wage has Use Prevailing Wage set to Yes. The rate agreement with prevailing wage rates should then be set to the category Prevailing Wage.
The header parameter is defined in Job Cost Parameters. The usual case would be to add parameter Location as a header parameter, which is used as an example in the following text. Another option could be to use for example contract reference referring to the valid rates. The location parameter will then be added to the rate agreement header instead of each row in the agreement. The same location cannot be used in more than one Rate Agreement. The same parameter also needs to be set as Use On Job to be able to define the default location on the job. This setting also makes the location parameter available for the user to change in My Time Registration (Other pages used for time reporting is delimited and the parameters won't be available there). Any updates of parameters connected to a transaction, could be done by drilling down to the page Job Transaction Parameters.
On the job, i.e. project activity and work task, the Job Rate Management tab should be used to add correct settings. The tab is available in all levels (Project, Sub Project, Activity, Work Order, Work Task) and the settings can be inherited to lower levels or defined as specific values in each level. There is a setting, Use Prevailing Wage, that says if this job should consider prevailing wage or not. If this is False, no prevailing wage rate agreements will be considered in the calculation at all. The parameters defined as Use On Job, will be available in this tab. The values for these parameters will be the default values fetched to the transaction when time is reported on this specific job.
When using prevailing wage the calculation can result in a shortfall. How this should be added needs to be defined in Fringe Shortfall Allocation. This is defined per company.
When all settings are done, and the transactions for the period are reported,
the calculation can be started. If a transaction eligible for prevailing wage
rates based on the prevailing wage parameter, the Job Cost Details will be created
based on separate rules. Direct rates from the prevailing wage rate agreement
is summarized and compared to the sum of the direct rates in other matched rate
agreements. The Job Cost Details with Job Cost Payment Type Direct will be created
from the agreement with the greatest summarized amount of direct rates. The
Indirect rates are always added from the connected rate agreements that aren't
of type prevailing wage. The total sum for the different kinds of rate agreements
are then compared. The result should at least match the largest of these sums,
but if this is not the case a shortfall is added to the result so that the total
result matches the largest amount.
Example:
| Union Rate Agreement connected to the employee | ||
| Job Cost Type | Job Cost Payment Type | Rate |
| Basic | Direct | $28.00 |
| Health | Indirect | $15.00 |
| Increment | Direct | $2.00 |
| $45.00 | ||
| Prevailing Wage Rate Agreement with reported location | ||
| Job Cost Type | Job Cost Payment Type | Rate |
| Wage | Direct | $25.00 |
| Fringe | Indirect | $26.00 |
| $51.00 | ||
Direct rates in Union rate agreement are summarized as $28+$2=$30, and in prevailing wage rate agreement as $25. The details are created from the greatest summarized value of these two, i.e. the union rate agreement, which gives row number 1 and 3 below.
The indirect Job Cost Details are always fetched from the Union Rate Agreements, which gives row number 2 below.
The sum of these three rows is $45, as in the union rate agreement, but when comparing the two agreements the prevailing wage rate agreement is summarized to $51 which is the minimum rate the employee should get. As a result of this, a shortfall of $6 is added in row number 6.
| Job Cost Details | |||
| Job Cost Type | Job Cost Payment Type | Rate | |
| 1 | Basic | Direct | $28.00 |
| 2 | Health | Indirect | $15.00 |
| 3 | Increment | Direct | $2.00 |
| 4 | Shortfall | Direct | $6.00 |
| $51.00 | |||