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What If I Have An Employee That Works Both in Field and in Overhead?

This is a fairly simple situation, once you decide how you're going to split their time.  You're going to enter the employee in both budgets, but the important part of this problem is deciding how many hours to put in one budget vs. the other.

TIP:  Remember to only include the hours you will include in your estimates (estimated hours) in the field labor budget!  If you have a supervisor that works in the "field" but you don't include their time on estimates - they are overhead, not field labor!

Here's how to split an employee's time:

  1. Decide how many hours you can recover of their time in estimates
  2. Enter the estimated hours, and cost of wages in the Field Labor Budget
  3. Enter the remaining cost of wages in the Overhead Budget (Wage Section)

Here's an example:

Jake is an owner-operator who works in the field "on the job" sometimes, but you also do all kinds of "office" work, like selling, estimating, managing, etc.  

  • Jake starts by estimating how much of his time he is going to recover by including those hours in estimates.  He guesses about 25 hours a week, 36 weeks a year.  (Total:  900 hrs per year)  Jake also estimates that he works about 2500 hours per year (he is an owner!), so he estimates about 36% of his total hours.
  • Jake enters himself in the Field Labor budget.  
    • For Hourly Employees:  Jake enters 900 hours in the field labor budget, and a rate of $28/hr (the rate he wants to pay himself for "field hours")
    • For Salary Employees:  Jake enters 900 hours in the field labor budget (salary section) and then enters 36% of his desired annual salary.  If Jake wanted to make $70,000 per year, he'd enter $25,200 (which is $70,000 x 36%) in the field labor budget

  • Jake still needs to be compensated for his "non-estimated" hours, so he enters the remainder of his annual wage in the Overhead budget.   If Jake wanted to make $70,000 per year (total) and he'd already included $25,200 in the field labor budget, then is overhead wage budget must be $44,800.

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