Payroll vs Job Costing Wages

Occasionally we hear from a customer who is comparing Virtual TimeClock gross wages with their payroll gross wages and finding small differences. In this short article we'll cover why this discrepancy exists and how to properly use gross wages in your employee time clock software.

Gross Wages for Job Costing
It's important to understand that gross wages in Virtual TimeClock are not designed to be used for payroll. Gross wages in Virtual TimeClock are for job costing purposes only and are calculated very differently than payroll gross wages.

Calculating payroll gross wages involves multiplying an employee's total hours by their hourly rate. On the other hand, to calculate job costing wages, Virtual TimeClock totals each timecard entry with the hourly rate and adds those together. This allows the TimeClock to provide job costing across a variety of day-to-day job IDs and tasks while including multiple employees at unique pay rates.

Job costing totals in Virtual TimeClock are calculated quite differently than payroll gross wages and this is by design. Job costing gross wages allow employers to get a good idea of the man hours and costs that go into a particular activity or job ID across the business. Learn more in the Calculating & Reporting Gross Wages article.