- Eliminates Effort Needed to Develop Interface with ADP Payroll Service
- Minimizes Manual Accounting Intervention
- Eliminates Need for Duplicate Payroll Feedback
- Handles Incentive Pay
This module collects payroll data for interfaces to many payroll systems, including the ADP Payroll System. The Payroll module interfaces with the DMACS Shop Floor Control modules (i.e., Work in Process and Labor Collection) for collecting payroll information, and it provides management personnel with the ability to monitor and adjust shop floor feedback that will eventually feed an outside payroll service.
The Payroll module accommodates payroll processing for both direct and indirect labor feedback. Direct feedback can include both piecework and normal (non-piecework) operations. Normal feedback is time reported by a direct employee for non-incentive operations. The payroll calculation for normal feedback is based on the employee’s normal hourly pay rate. Piecework feedback, on the other hand, is based on an employee’s incentive rate.
The Payroll module also provides the ability to optionally enter a temporary standard for non-standard labor feedback transactions. This is allowed for piecework operations only, and is not considered a permanent change to either the standard routing or the work order routing.
When an employee has worked on piecework operations, the Payroll module will calculate two payroll values – the employee’s piecework earnings and the employee’s guaranteed earnings and then accumulate the employee’s guaranteed earnings for the piecework operations.
The Payroll module will accumulate an employee’s total piecework earnings and total guaranteed earnings for the pay period. The employee will then be paid his piecework earnings, and if his total guaranteed earnings is greater than his total piecework earnings for that period, then he will also be paid the difference between the two. This piecework differential, which is the difference between the standard hours earned and the actual hours worked extended by the guarantee rate, is generally considered overhead and can be charged to a special overhead account. It will also be posted to the Labor Audit Trail as Indirect Labor.
The Piecework Rate is established at the employee level and defined on each Pay Code record that is flagged for piecework. This rate can be overridden during labor feedback time by management personnel.
Management Override to Setup and Direct Labor Hours In addition to being able to override the Piecework Rate as mentioned above, the DMACS Payroll module also allows management to override the Standard Direct Hours and the Standard Setup Hours for an operation. This is a temporary change to the standard hours for the purposes of increasing an employee’s efficiency percentage and should not be considered a permanent change to either the standard routing or the work order routing. Therefore, an override to the standard labor hours will have no effect on the planning process.
Average Earning Adjustments
The module provides the ability for qualified personnel to be paid based on their average (hourly) earnings from the past quarter as opposed to their regular hourly rate. An Average Earning Adjustment programl calculates each employee’s average earnings (i.e., average hourly rate) from their work in the past quarter and set the rate up for the coming quarter (using the effectivity dates on each record). All labor feedback posted by an employee in the coming quarter that has average earnings rate code assigned to the pay code will be paid based on that employee’s new average earnings rate as opposed to their standard hourly rate.
The Payroll module supports the following major functions:
- Payroll calculations can be based on both normal and piecework feedback.
- Pay Codes can be defined by an employee as a means of overriding an employee’s standard hourly pay rate for piecework operations.
- Hourly Pay Rates that are assigned to pay codes can be defined by effectivity period; thus, allowing pre-definition of pay rates for the coming month, quarter, etc.
- An Average Earning Adjustment capability allows an employee’s standard hourly pay rate for a coming time period (e.g., quarter) to be adjusted based on their average earnings from a previous time period (e.g., quarter).
- A Batch Time Card Load capability relieves you from making manual time card entries and posts both overtime and night shift hours to the Labor Audit Trail as indirect labor.
- Overtime and Piecework Pay Differential are calculated per employee. Various overtime payments are available.
A Payroll Extract program extracts payroll data from the Labor Audit trail for input to the ADP Payroll System. The extracted payroll information can be modified to accommodate any third-party payroll system.
The Payroll module utilizes a series of multi-functional forms which the user selects to perform the desired activity. The number of forms have been kept to a minimum, and they have been designed for ease in used and understanding. A sample of these include:
Labor Feedback by Employee and Pay Code
This form is used to enter a Pay Code along with each normal labor and piecework feedback transaction. The Feedback by Employee and Pay Code form records direct labor, indirect labor, rework labor, work center labor, or non-standard labor.
Rework labor feedback is used to record rework labor performed on a WIP order. Work center labor feedback is used to record labor performed at a work center but not against any particular WIP order (for example, general maintenance or ovrerhaul of machines at a work center).Non-standard labor feedback is used to record labor performed on a WIP order the same as direct labor feedback. However, the operator efficiency is calculated, and if the efficiency is less than 95%, an adjusting entry is made to the labor history audit trail to bring the employee’s efficiency up to 95%. This type of feedback is commonly used in cases where non-operator-controllable factors are adversely affecting efficiency, for example, faulty equipment or sub-standard materials.
Labor Feedback Override by Employee
This form allows management to browse through the labor feedback transactions or a selected employee and update each transaction by entering override values to the operating that was fedback, along with the pay code field for each selected operation. The values entered in the override fields for the standard setup and direct labor hours will be overrides to the standard values on the Work in Process routing. Any entries that are made here are considered a temporary change to the standard hours for the purposes of increasing an employee’s efficiency percentage.
This transaction is used to define the valid Pay Codes that are used throughout the Payroll module. When this option is turned on, pay codes will provide control over a number of the payroll interface processes. Pay code can be used for the following reasons:
- For identifying those feedback transactions in which an employee should qualify for piecework pay.
- As an override to the employee’s actual pay rate by providing a link to an Employee Rate table to extract the appropriate pay rate for the operation that was performed.
- For indirect operations, the pay code can determine which General Ledger account should be used for posting the indirect labor and or indirect operations, the system will use the General Ledger account assigned to the pay code.