Quick Tips for Managing Construction Payroll

Financial and Construction Accounting Strategies to Help Make Your Company More Profitable

Whether you currently own Sage 100 Contractor or if you’re looking for an easier way for managing construction payroll, Plumb has hosted a free webinar.  In this 30-minute webinar, Plumb will walk you through the different ways to produce construction payroll reports in Sage 100 Contractor.  There are many benefits from this functionality of the software that QuickBooks doesn’t offer for the construction industry.

Managing Construction payroll topics will include:

  • Certified Payroll
  • Union Reports
  • Workers Comp Report
  • Payroll Calculations & Expenses
  • Federal, Multi-State Tax Reports – filing with Aatrix
  • Payroll from Daily Field Reports
  • Timekeeping Solutions
  • Sage Service Operations
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Sage 100 Contractor – Bundled Pricing Package with Software & Implementation

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Managing Construction Payroll – Tips to Follow

Collect Timecards Everyday:  When employees track their time by the week, they can easily underestimate time missed and overestimate time worked;  that is simply human nature.  In fact, by managing construction payroll daily instead of weekly, your business could save an average of one hour per week for every field employee.  That can really add up.  You could save more than one full week of pay for every field employee each year.  Saving that kind of money certainly justifies the extra effort of collecting time cards each day.  Using daily time cards also enables you to better monitor production, spread out your office workload, and spot inconsistencies in reporting sooner rather than later.  

Profits in Action:  Use the Daily Payroll option in Sage 100 Contractor to enter your construction payroll for the previous day.  At the end of the pay period, simply process the daily records into timecards and print your checks.

Segregate Time Worked to Save on Workers Comp: Many states allow construction companies to utilize a workers compensation rate specific to the task being performed.  Segregating a workers time into the most appropriate risk group can save you a lot of money.

Managing construction payroll – it works like this.  Say one of your employees spends four hours forming sidewalks and four hours framing the sub-floor on a house.  On that employee’s timecard, reflect the two different tasks so your business can receive the lower workers’ compensation rate for sidewalk forming.  Assuming that the workers’ comp rate for carpentry work is 25 percent, the sidewalk workers’ comp rate is 9 percent, and the employee’s pay rate is $20 per hour (for both types of work) for an eight-hour day, the math works as follows:

            • Without segregating the employee’s time, here’s what you would pay for workers’ compensation:
            • 8 x $20 x .25 = $40.00
            • What you pay now: (4 x $20 x .25) + (4 x $20 x .09) = $27.20
            • You save: $12.80 on every $160.00 in wages  |  Profits in Action: This savings represents 100 percent pure profit and Sage 100 Contractor can do all of the work for you.

Try to Reduce False Workers’ Compensation Claims:  Few things strike more fear into a contractor’s heart than a large worker’s compensation claim.  Sadly, false claims cost many contractors many thousands of dollars.  While it may be impossible to stop an employee from filing a false claim, many contractors believe an effective deterrent is to add a signature line and the following statements to employees’ daily timecards.

            • I was/was not injured today.
            • Describe injury in detail _________________
            • I did/did not witness an injury today
            • Describe injury in detail

Profits in Action: Use the Sage 100 Contractor Timecard Report to print a project-specific timecard that includes all cost codes for the project.  Ask employees to complete one and drop it in a lockbox on the job site before leaving for the day.managing construction payroll

Leverage Qualified Benefits on Prevailing Wage Projects: As a non-union contractor who performs prevailing wage work, you must pay the required benefits in cash.  However, if you have a qualified health care or vacation benefit program, you can offset the cash requirement with the value of your qualified plan.  This requires establishing the hourly value of your qualified benefit plan prior to calculating payroll, then deducting this value from the required cash benefit.

Profits in Action: Use Sage 100 Contractor to make automatic qualified benefit calculations when payroll is processed.  Simply enter the value of your qualified benefits as the offset to the prevailing wage rates; all reporting and tax calculations will then be generated.

Save Workers’ Compensation on Prevailing Wage Benefits:  When you pay prevailing wage benefits in cash, the vacation portion is not normally subject to workers’ compensation.  By excluding these vacation amounts from the workers’ compensation calculation, you may be able to save a sizable amount of money.

Profits in Action: Sage 100 Contractor can make this calculation for you.  Simply set the cash vacation benefits to exclude workers’ compensation on the payroll calculation screen.  Your workers’ compensation reports and your job costs can reflect the correct amounts.

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About Plumb:

Successful companies in the building industry develop reputations for completing projects on time and on budget. Plumb makes sure accounting grows with you, based on our experience in providing critical tools, reports and systems to over 500 specialty contractors, general contractors and developers, from start-ups to companies in excess of $100 million. We are true construction accounting experts skilled in outsourced accounting with this list of services.

For more information about Plumb and how  Sage 100 Contractor software can help with your construction payroll, contact us

Take this Construction Software Needs Assessment to find the right construction accounting software for your business.

Sage Paperless Construction Gives You Paperless Payroll

Managing construction payroll is a paper-intensive task, with time-consuming processes that involve timesheets and approvals with manual data entry. Sage Paperless Construction is a solution that can be integrated with Sage 100 Contractor and Sage 300 CRE. Using the system with Sage, the payroll process can be handled electronically with scanned time cards that are routed for approval and importanted into you preferred solution.

Download the product sheet for complete list of product overview and benefits

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