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Setup: Pay Contract for Contractor - Load Revenue
In order to set up rate to pay a contractor for load-based attributes you need to set up a 'Pay Contract' for the contractor. Select Contracts | Payment Contracts | Contract Setup from the Main Menu. This link explains how to use the 'Pay Contract Wizard' in order to set up a pay contract.
The key steps involved in setting up a contractor contract in the wizard are Steps 2, 4, and 6, as explained below.
Step 2: Select the Contractor for the Pay Contract
In this step you select the contractor you want to pay. To do so, you must click on the 'Type' Contractor (circled above) which fills the list on the left with your contractors. You then select the contractor (you can only select one at a time) you want to pay.
The pay contract operates differently depending on your selection during block setup of whether you are tracking activities, employees/ equipment on your block:
Case I: Track Activities, Employees, Equipment on Load Slips.
When you track equipment on a load-by-load basis (left radio button selection in the above picture), The Logger's Edge will look at the equipment owner on the load slip to determine who should be paid. For example, let's assume that Bill Swift Contracting has been selected as the contractor to pay for the skidding activity on a given block. The Logger's Edge will look at the skidder equipment entered on the load slip and determine who is the owner. If the owner is Bill Swift Contracting, then Bill Swift Contracting will be paid. Likewise, if the owner is a different contractor, say Arrow Contracting, then Arrow Contracting will be paid (assuming a contract is set up for Arrow Contracting).
Note
that there is an entry called "OWNER" in the contractor list on Step 2
of the pay contract wizard (shown above). The 'OWNER' entry is very powerful
in that it acts like a wild card for equipment owners. If you select OWNER
when setting up your payment contract, you can pay whichever contractor owns the equipment that is entered on the load
slip. Thus, if you want to pay all contractors based on identical terms,
you can setup just one pay contract using the OWNER wild card and it will
cover all contractors. Moreover, if you use an OWNER contract, but want to pay
one contractor an exception rate, you can set up a specific contract for that
contractor. The Logger's
Edge is smart enough to choose the
specific contractor's contract when an OWNER contract might otherwise apply.
Example. I have five logging contractors that work for me that get paid 25 percent of load revenue, with the exception of Jeff Kent Contracting who gets 30 percent for his equipment. I set up one contract that pays "OWNER" to cover all logging contractors. I then setup another contract to pay Jeff Kent Contracting specifically -- this contract will trump the "OWNER" contract so that Jeff Kent Contracting will only be paid once.
Case 2: Do Not Track Activities, Employees, Equipment on Load Slips.
When you do not track equipment on a load slip basis, The Logger's Edge will pay the selected contractor whose pay contract covers that block for all loads for the block that match the pay rate criteria (see below) in his contract. In other words, The Logger's Edge makes the key assumption that the equipment units on the load slips from the block all belong to a single contractor; thus there is no need to enter them on a load-by-load basis.
The 'OWNER' entry must
not be used for a non-trucking contract where option (2) 'Do Not Track
Activities, Employees, Equipment on Load Slips' has been selected during the block setup.
Step 4. Select 'Load Revenue' Contract Type
You must select the 'Calculate Pay as a Percentage of Load Revenue' option.
Step 6. Enter Pay Rate
This is the step where you enter the rate you want to pay the contractor. A detailed explanation is available in the link: Setting up Pay Rates: Calculate Pay based a Percent of Load Revenue. The screen below shows an example of the rate screen.
The two requirements for an contractor to be paid according to a pay contract are:
(1) that the block on the pay contract must match the block of the load (or the block entry must be blank), and
(2) that the activity on the pay contract must match the activity for the contractor entered on the load slip.
In this screen you can set up the rate breaks you want to use to pay the contractor. In row 1 (in the example above), I have entered a blank for the block, indicating I want a rate of 20 percent of Load Revenue to apply to skidding for ALL blocks. In row 2, I have entered an 'exception' rate that indicates that if the skidding is performed in block '03-RAINBOW-2991', I want to pay 22 percent of Load Revenue. The rate in row 3 is the same as in row 2, except that it has an effective date of 6/1/2004 -- meaning the rate of 23 percent will apply for loads delivered on or after 6/1/2004. For loads delivered between 1/1/2004 and 5/31/2004, on block 03-RAINBOW-2991, the rate of 22 percent is operative.
In calculating the percent of load revenue, The Logger's Edge multiplies the percentage amount by the revenue for the matching pay activity for the load. Thus, if your contract is set to pay 20.0 of load revenue for SKID, you must have revenue for SKID on the load. Likewise if your contract is for 80.0 of load revenue for TRUCKING you must have revenue for TRUCKING on the load. This requirement means that you must have a revenue contract set up for the matching activity for which you want to pay on a percent of load revenue.
Extension
There is an option in The Logger's Edge that allows you to override the activity matching requirement. We can configure your system so that you can specify the revenue activity upon which you want your percentage rate to be applied (see below).
In row 1, the 5.0 percent rate is applied to load revenue from the 'LOG PURCH' activity -- not the skidding activity. The Revenue Activity column gives you the flexibility to choose which revenue activity you want to use as your pay basis. Of course you can always opt to select the matching activity (see row 3).
This feature is particularly useful in a scenario such as commission payments to a forester. For example, if you want to pay a forester a commission based on a certain percentage of the revenue you receive on the sale of the load, your activity might be "commission," but the revenue activity would be "Log Sale."
By default, the Revenue Activity column is NOT enabled in The Logger's Edge.
