Staff Rates

Create a set list of charge-out rates that are assigned to staff for timesheet allocation, budget estimates and on charging to the client.  The Staff Rate is usually determined by market value when bidding for a Project.  Proposals usually quote a category of staff rather than a definitive staff name, therefore making Staff Rates easier to maintain.  All staff records must have at least Staff Rate.

Getting Started

Who Can Use It?	Where Is It?
Director System Administrator	Practice > Rates > New Rate > Staff Rate

Create

1. Click New .
2. Select the Staff Rate button on the pop-up window.
3. Type a description and the value of the charge out rate.
4. Save and close.

More information

Standard rate group

All new staff rates are attached to a Standard Rate Group - this drives Standard Cost calculations. Additional Rate Groups can be created to allow the setup of specific rates for a particular client or project type that are used on a regular basis eg all Staff Rates used on legal work may differ from the Standard Staff Rates or one client may receive a special discount, at cost etc. 

Description

The description of the staff rate will appear internally when doing timesheets, against the budget and also on the Invoice - if the Invoice Template is configured to display Staff Rates.

Charge per unit

Market value charge-out rate including profit.  You would already be quoting these rates on fee proposals to your client. This rate is used to calculate estimates for budgeting purposes and to preempt an invoice value based on the number of hours allocated by an individual staff at this rate.  A rate can be manipulated by using  specific rates or creating additional rate groups.

Overhead cost / hour

Throughout the system - on screens and reports - a cost will be calculated to measure profitability on projects compared with invoices issued to the client (Invoiced less Cost = Profit).  Depending on a users access level, they may only be able to view Standard Cost.  This is calculated from the Staff Rate less the profit markup:

Example - Standard Cost

Staff Rate	Charge Out		Less Profit markup		Standard Cost	Standard Cost Profit
Director	$200		25%		$160	$40

It's a benchmark guide as to what your Staff Actual Costs need to average at or value under, for each Staff Rate to obtain the estimated profit. Each staff member will have their own cost based on their salary/hourly cost plus overhead. If a Standard Cost is lower than Actual Cost then it would indicate that the Staff Rate will not be making the estimated 25% profit.  

Example - Staff actual cost

Staff Rate/Staff	Charge Out		Actual Cost		Actual Cost Profit %	Actual Cost Profit	Difference in Profit
Director / John Smith	$200		$152.65		31%	$47.35	$7.35 extra than Standard Cost Profit
Director / Gillian Andrews	$200		$172.00		16%	$28.00	$12.00 below Standard Cost Profit

If we Invoice 1 hour of John Smith's time, the following comparisons can be made when comparing Standard Cost and Actual Cost:

Standard Cost = 160 > Profit earned when 1 hour is Invoiced = $40

Actual Cost = 152.65 > Profit earned when 1 hour is Invoiced = $47.35

Tip: Anytime Staff Actual Cost is higher than the Standard Cost, you will not be returning the estimated Profit

Example - Staff actual cost

The final example, that may be extreme, which can occur is where the Staff Actual Cost doesn't actually cover Standard Staff Rate Charge.

The system will also calculate an Estimated Charge Rate for each staff member. This is worked out by adding the Profit markup to the Staff Overhead Cost including. 

Changing the charge rate

The effective date of a staff rate change can be backdated providing the timesheet hasn't been invoiced.

Unbilled Transactions using the current staff rate charge will be recalculated with the new charge from the effective date. Transactions prior to the new effective date will not be recalculated. 

Effective dates

An effective date sets the item cost and charge from a particular date. All Transactions allocated to the item prior to the new effective date will be calculated using the previous cost and charge and all transactions allocated from the effective date will be calculated at the current cost and charge - until such time a new effective date is set. 

Staff tab

All staff that have been allocated with this rate will appear in this screen.  The lower part of the screen will show the Staff Actual OH Rate per hour and the Staff Actual Charge Rate per hour.  This is a guide to compare the staff charge rate to ensure estimated profits can be made.

This is as per the Overhead cost/hour examples above.

Want to learn more?

Looking for more help? Try reviewing the following Practice topics: View Topics

Or try reviewing the following Rates topics: View Topics

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