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Unit 3 Time and Work Records McGraw-Hill/Irwin Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-3 FLSA and Time Records The Fair Labor Standards Act (FLSA) requires: –Businesses to have procedures in place that meet requirements for computing payroll. –Time and work records are designed to gather information for each payroll period. –These records are used to prepare the regular pay periods and then the paychecks. Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved. 3-3

3-4 Weekly employees are paid: – 52 times per year –or weekly. Biweekly e mployees are paid: –26 times per year – or every 2 weeks Payroll Periods Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-5 Semimonthly e mployees are paid: –24 times per year –or twice per month Monthly e mployees are paid: –12 times per year –or once a month Payroll Periods Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-6 Payroll Periods Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-7 Marie Santos earns an annual salary of $100,000. –Calculate Marie’s weekly gross earnings: $100,000/52 = $1, –Calculate Marie’s biweekly gross earnings: $100,000/26 = $3, –Calculate Marie’s semimonthly gross earnings: $100,000/24 = $4, –Calculate Marie’s monthly gross earnings: $100,000/12 = $8, Payroll Periods Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-8 The Need for the Time Records The Fair Labor Standards Act: –requires time records for all employees –except those who are exempt. Time records must show: – the day and time when an employee’s work week starts, –the number of hours worked each day, –and the total hours worked during the week.

3-9 Time-Keeping Devices and Systems Time clocks & time cards: –Time clocks: are mechanical or electrical devices that print on the card the time at which a card is inserted into the clock. Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved. 3-8

3-10 Time-Keeping Devices and Systems Time clocks & time cards: –Time cards: used to keep track of the hours worked by each employee. –A clock station is: the location where the time clock and racks of time cards are kept. Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-11 Computing Hours Worked Quarter hour system: −An advantage to using the quarter hour system is that this system makes it easier to figure hours worked. −The disadvantage it that this system can cost the company in lost work. Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-12 Computing Hours Worked Tuesday of one week, Paul Pacelli worked from 8:14 to 12:15 in the morning and from 12:57 to 5:00 in the afternoon. His firm uses the quarter- hour time system. How many hours will the firm records for Paul that day? –Morning – 4 hours –Afternoon -- 4 hours –Total Hours = 8 hours Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-13 Computing Hours Worked Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-14 Companies that have a manageable number of employees often use time sheets in place of time cards. Time Sheets Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-15 Time Sheets Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-16 Dealing with Lateness to Work In metropolitan areas there is a steady and growing problem with commuting. Workers are often late to work due to no fault of their own. –Options: Carpool/Mass-transportation systems Work at home arrangements Flextime systems Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-17 Sales Records Sales records vary from business to business. –businesses pay a sales person: strictly on the dollar amount of sales generated. Or may receive an hourly pay as well as a percentage of sales. It is not necessary for firms to keep time records for employees who are paid on the basis of the sales they make Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-18 Sales Records Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-19 Labor Distribution Labor Distribution: –the cost of labor is often charged against specific jobs or projects. –employee marks the time card to indicate which job is to be charged. –The cost of materials and overhead may also be recorded. Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-20 Labor Distribution Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-21 TEMPORARY WORKERS: generally receive their pay from a temporary agency. replace an employee on medical leave or vacation. CONTRACT WORKERS: work under contract arrangements. are paid an agreed upon fee. work independently. Other Kinds of Workers Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-22 Unit Summary Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

3-23 Questions? Copyright © 2006 The McGraw-Hill Companies, Inc. All rights reserved.