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Setting up a Payment Contract: Wizard
The Pay Contract Setup Wizard takes you through all the steps necessary to set up a pay contract (or any geographic work area)
Step 1. Introduction
Step 2. Select the vendor (company) that will be paid.
This step asks you to identify who will be paid. You can either pay a contractor or a worker (equipment operator or driver).
In the screen above, I have selected White Contracting as the vendor that will be paid.
Note that there is an entry called "OWNER." This entry is very powerful in that it acts as a "wild card" for the pay contract. If you select OWNER, you can pay the owner of each piece of equipment (or log truck) entered directly on the load slip. Thus, if you want to pay all contractors for a give phase (such as skidding or cutting) based on identical terms, you can setup 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 vendor an exception rate, you can set up a specific contract for that vendor. The Logger's Edge is smart enough to choose the specific contractor contract when an OWNER contract might otherwise apply.
Example. You have five loaders that work for you that get paid $2.00/Tonne, with the exception of XYZ Contracting who gets $2.10. Set up one contract that pays "OWNER" to cover all contractors (including XYZ). Then setup another contract to pay XYZ specifically. This contract will trump the "OWNER" contract so that XYZ Contracting will only be paid once.
If you click the 'Worker/Operator' contract Type, the list on the left provides a listing of workers instead of contractors. This allows you to pay a specific worker based on loads delivered. For example, if you have an employee truck driver you can specify that employee and set up his payment terms.
Note that there is an entry called "DRIVER." This entry is very powerful in that it acts like the OWNER wild card for contractors. If you select DRIVER, you can pay the operator of the equipment (or log truck) who is entered on the load slip. Thus, if you want to pay all drivers based on identical terms, you can setup one pay contract using the DRIVER wild card and it will cover all drivers (both your own direct employees, as well as any contract drivers whom you want to pay separately from the trucking company that owns the truck). Moreover, if you use an DRIVER contract, but want to pay one worker an exception rate, you can set up a specific contract for that vendor. The Logger's Edge is smart enough to choose the specific worker contract when an DRIVER contract might otherwise apply.
Example 1. You have 10 truck drivers operating your company-owned trucks. All but one of them is your employee. You pay these employee drivers 30 percent of the load revenue the mill pays you for trucking. The other driver, Jason Pettit, is a contract worker that you employee occasionally to driver your truck. You pay him a certain rate per tonne for his deliveries. You can set up one contract that pays "DRIVER" to cover all drivers (including Jason) at 30 percent of load revenue. Then set up another pay contractor specifically for Jason Pettit, and set his rates based on $X per tonne.
Example 2. You have five skidders (some your own employees, and some that are contract workers) that get paid $2.00/Tonne, with the exception of Jake Drew, who gets $2.10. Set up one contract that pays "DRIVER" to cover all workers, including Jake Drew. Then setup another contract to pay Jake Drew specifically -- this contract will trump the "DRIVER" contract so that Jake will only be paid once.
Step 3. Select the blocks covered by the payment contract
Payment contracts are assigned to Blocks -- meaning that the terms apply to loads (or activities) on slected blocks. By making a contract applicable to specific Blocks, you can have handle multiple contractors that perform certain activities on some blocks but not others.
Step 4. Select Payment Type
Next, The Logger's Edge Software asks you to the "Type" of Contract you want to set up.
There are 5 basic types of contracts you can set up.
- Calculate Pay as a Percentage of Load Revenue. This option allows you to set up a "rate" that is not a true rate, but a percentage of your revenue rate. For example, if you are paid $100 for trucking, you might pay your driver 25% of that amount. This allows your driver pay to fluctuate based on your load revenue without setting up a specific pay rate for all the gradations in revenue rates you receive from a mill. (Only applies to Load Slips)
- Calculate Pay based on Load Attributes. This option allows you to pay load slips based on counts, weight, volume or distance. For example, you could pay by the Tonne, MBF, M3, Mileage, etc. (Only applies to Load Slips)
- Calculate Pay based on Hours or by Tree Count. If you have contractors that are paid by the hour (not load slip) you can set up a contract to cover their hourly time. For example, if you have a contractor who does yarding and is paid $25.00/Hr., you would select this option and enter his time under contractor time slips. (Only applies to Contractor Time slips)
- Calculate Pay based on Production Activity. If you have contractors that are paid by production activity (e.g. by the day or mile or KM, rather than based on the load slip or based on hours or tree-counts entered on time cards), you can set up a contract to cover their production. For example, if you have a contractor who does yarding and is paid $125.00/Day, you would select this option and enter his time under contractor production slips. (The production slips are under Data Entry | Production Activity.) Option D is only applicable for production slip entries.
- Calculate Pay as a Percentage of Load Value. This option is used in the circumstance where you want to pay a vendor (say a landowner) some percentage of the profit earned on a load (load value). For example, suppose you want to pay a landowner 50 percent of the revenue earned on load slips less the cost of harvesting and trucking. You could use this option to pay him 50% of the load value. (Only applies to Load Slips)
Step 5. Select the Start and End date for the contract.
This step is used to identify the date range for the contract. Loads or Hours or Production Activity will only be paid if their pay date falls within the date range for the payment contract. Users often set the start date on the pay contract at the beginning of the calendar year or the beginning of the log year, and set the end date as the end date of the calendar year or the log year.
This window also allows you to determine whether taxes (such as GST) are applied.
Step 6. Setup Payment Rates
This screen is where the rubber meets the road. The grid has columns for Block, destination and your other load attributes; a column for the pay rate, the pay basis, and the effective date.
The rate grid has alternative views depending on your selection of payment type in Step 4.
- Calculate Pay as a Percentage of Load Revenue.
- Calculate Pay based on Load Attributes.
- Calculate Pay based on Hours.
- Calculate Pay based on Production Activity.
- Calculate Pay as a Percentage of Load Value.
The rate grid (for loads only) also has certain extended features that can allow you to pay by distance or pay a minimum amount (See Extended Features).
Step 7. Name the Payment Contract
This screen is where you provide a name (Code) for the payment contract. The name or code should be a short description by which you can easily recognize the contract. The description entry is used to provide a longer, more explicit description of the contract. The code is the label that will appear on vendor or employee settlements, so it should be something meaningful for both you and the vendors/employees.
Step 8. Finish
You MUST click on Finish to save your pay contract information, otherwise your prior selections will be Lost -- This is NOT good. If you click Cancel or otherwise exit the wizard without clicking Finish, none of your entries will be saved. Up until this step all changes are stored temporarily and are not saved until you click Finish.
Did I mention that you must click Finish to save your Pay Contract?
