Overview: What are Pay Rates?

A pay rate is the hourly cost of an employee's labor—the figure that turns hours worked into a dollar amount on the job. On a construction project, labor is one of the largest and most variable cost to track, and getting it right is what separates an accurate job cost from a guesstimate. 

What makes labor cost difficult is that it rarely comes down to a single number. We all know that overtime is paid at a higher rate than regular hours, usually time-and-a-half or even double-time, depending on your state, your laborers' union, or other various factors. Plus, rates can change as crews are added or roles shift mid-project; the same worker may earn one rate framing and another running equipment. When those variables live in a spreadsheet maintained separately from the field, labor cost is always a step behind the work being done.

Regular Time v. Overtime

Most labor is paid at a regular hourly rate up to a defined threshold, after which additional hours are paid at an overtime rate—commonly 1.5x the regular rate. Accurate job costing depends on separating the two, so that regular and overtime hours are each valued correctly rather than averaged together. Tracking that split by hand across an entire crew, week after week, is where manual timekeeping most often breaks down. 

Pay Rates in ConstructionOnline™

Pay Rates in ConstructionOnline capture these variables directly within the Time Tracking feature. Each employee is assigned a rate structure once, and ConstructionOnline applies the correct rate automatically the moment a shift is logged, giving construction teams real-time visibility into labor costs as they are incurred, without waiting on payroll to reconcile. 

As part of ConstructionOnline's Time Tracking feature, Pay Rates are available for any active subscription with access to Time Tracking. By default, this includes all Business and Enterprise packages, as well as accounts explicitly subscribed to Time Tracking as a subscription add-on. 

Configuring Pay Rates

• Assign each employee a default rate, overtime multiplier, and overtime rate. See Set Employee Pay Rates
• Add rates for specific Cost Codes so pay adjusts to the type of work being tracked, and control which Cost Codes an employee see when clocking in. See Set Cost Code Pay Rates

Managing Pay Rates

• Copy one employee's full rate structure to other Company Users who share the same pay setup. See Apply an Employee's Pay Rates to Other Users
• Apply updated pay rates retroactively to shifts previously entered, so historical labor costs stay accurate. See Apply Pay Rates to Past Shifts
• Limit an employee to only the Cost Code(s) relevant to their specialty or role when clocking in. See Restrict an Employee's Cost Code Visibility When Clocking In 

Where Labor Costs Appear

• In the Time Summary, labor costs appear alongside logged hours on individual shifts and in the regular, overtime, and total figures.
• All Time Summary Reports (Project, Employee, Company) include labor cost columns and totals.
• Excel exports of Time Tracking data include the configured pay rates, as well as regular, overtime, and total labor costs for each shift. 
• Through OnCost™ Purchasing, labor costs calculated from recorded Time Shifts can flow directly into Labor Expenses to close the circle on end-to-end job costing. See Create a Labor Expense from a Time Shift

How Pay Rates Calculate Labor Costs

When a Time Shift is entered, ConstructionOnline selects the Pay Rate to apply based on the Pay Rate configurations, following a simple priority order:

1. If a Cost Code Pay Rate is set for the Cost Code associated with the Time Shift, that Pay Rate is applied. 
2. If a Pay Rate is not set for the Cost Code or no Cost Code is associated with the Time Shift, the employee's default Pay Rate is applied.
3. Hours worked beyond the Overtime Threshold are valued at the OT Rate. 

Pay Rates Key Terminology

• Pay Rate (Default Pay Rate): The base hourly rate assigned to an employee. Applies to any shift that does not have a matching Cost Code Pay Rate, including shifts logged with no Cost Code selected. A default Pay Rate is required before any Cost Code Pay Rates an be set. 
• Cost Code Pay Rate: An hourly rate assigned to a specific Cost Code for an employee. Applied automatically in place of the default Pay Rate when an employee logs a shift against that Cost Code. 
• OT (Overtime) Multiplier: The factor applied to the Pay Rate to determine the Overtime Rate (for example, 1.5 or 2).
• OT (Overtime) Rate: The hourly rate paid for overtime hours, calculated as Pay Rate x OT Multiplier.
• Regular Rate: The rate applied to regular (non-overtime) hours on a shift. Either the employee's default Pay Rate or the Cost Code Pay Rate.
• Labor Cost: The calculated cost of logged time, derived from hours work and the applicable rate(s)—reported as Regular, Overtime, and Total labor cost.
• Cost Code Visibility: The setting that controls which Cost Codes an employee can see and select when clocking in. 

HAVE MORE QUESTIONS?

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