In this article, we explain how to set up contracts for creating week and day contracts.
Table of contents
What are contracts?
In TimeChimp, it is possible to assign a contract to an employee. This helps you manage overtime and gives you insight into whether your employees are registering enough hours! It is important to know that a contract in TimeChimp is not meant to be an employer-employee contract. This means that it is not about the period when someone was hired, but from when someone should start registering time in TimeChimp.
We have two types of contracts:
Weekly contracts.
A weekly contract is a contract where the hours are calculated on a weekly basis.
Daily contracts.
A daily contract is a contract where the hours are calculated on a daily basis.
How do I set up a weekly contract?
You set up a contract under the HRM tab:
Go to HRM.
Find the employee you want to enter a contract for.
Click on the three dots at the end of the employee line and choose 'edit'.
Go to contract.
Choose + new contract. A pop-up screen will appear.
Choose the correct contract type. Read more about contract types here.
Optionally, enter a contract number.
Enter a start date. This is the day the employee starts registering hours in TimeChimp. Note! It must be a Monday. If an employee starts registering on a different day, for example, on Wednesday, make sure that a full working day is also recorded for the employee on Monday and Tuesday.
Optionally, enter an end date. If this is not known, leave this field blank.
Choose 'week' for contract hour calculation.
Enter how many hours someone works per week.
Optionally, enter a sales hour rate. If you invoice based on employee hourly rate, this rate will be pre-filled at the project level by default.
Optionally, enter an employee purchase hour rate. You will see this as a cost on a project.
If you want to update the sales rate for all your projects on an employee hourly basis, check this option as a final step.
Click add/save! Your contract is created. 🥳
How to set up a daily contract?
You set up a contract under the HRM tab:
Go to HRM.
Find the employee you want to enter a contract for.
Click on the three dots at the end of the employee line and choose 'edit'.
Go to contract.
Choose + new contract. A pop-up screen will appear.
Choose the correct contract type. Read more about contract types here.
Optionally, enter a contract number.
Enter a start date (any day of the week)
Optionally, enter an end date.
Choose 'day' for contract hours calculation.
Enter the number of hours the employee works per day. If it varies, add an extra week rule.
Optionally, enter a sales hour rate. If you invoice based on employee hourly rate, this rate will be pre-filled at the project level by default.
Optionally, enter an employee purchase hour rate. You will see this as a cost on a project.
To update the selling rate for all projects, select the last option.
Click add/save and your contract is created! 🎊
Starting a weekly contract on a weekday
The day someone starts working is not always a Monday. How do you set up a weekly contract in such a case? This is easiest to explain using an example:
Jan starts working at TimeChimp on June 1st and will work 40 hours a week. June 1st is a Wednesday. In this case, you create two contracts:
The first contract starts on Monday, May 30th. The number of contracted hours for that week is 24. Jan works Wednesday, Thursday, and Friday for 8 hours each day. His total hours for the week are 24. You give the contract an end date of Sunday, June 5th.
The second contract starts on Monday, June 6th. The number of contracted hours for that week is 40. Jan works a normal workweek that week. You don't need to give an end date.
With this setup, you ensure that Jan's overtime is calculated correctly.
How are overtime hours calculated?
When you have entered a contract for an employee, TimeChimp will automatically calculate overtime based on the contracted hours. It will also take into account whether it is a daily or weekly contract.
Weekly Contract
In a weekly contract, at the end of the week TimeChimp looks at how many hours an employee has recorded. If the employee has exceeded their contracted hours, regardless of whether these are billable or non-billable hours, the hours beyond the contract are added as overtime.
If the employee works fewer hours than the contracted amount, the unworked hours are recorded as minushours.
For example: Suppose your employee works 40 hours per week. If this employee records 42 hours, they will get 2 overtime hours for that week. If the employee records 35 hours, 5 undertime hours will be added to the balance.
Important: Activities connected to 'absence types,' such as leave, absence, or user-created absence types, do not count towards the calculation of overtime hours.
For example, if you have a 36-hour per week contract and you log 40 hours of leave in a specific week, you will receive 0 overtime hours for that week even though you registered more hours than your contract.
Daily Contract
In a daily contract, TimeChimp does not consider the total number of recorded hours per week but per day. In the daily contract, you have specified how many hours an employee is supposed to work each day. If the employee enters more hours than indicated in the daily contract, the extra hours are added as overtime.
Minushours is not calculated in a daily contract. If an employee registers 4 hours on a day they should work 8 hours, it will not be calculated.
Note: Overtime or undertime is not entered as a separate registration in TimeChimp. They appear in the employee's overtime dashboard.
Contract Types
With contract types, you have even more options for calculating overtime. You can specify for each contract type whether overtime should be calculated or not. You can also set a percentage by which overtime should be calculated.
What should I do if my overtime hours are incorrect?
If it seems that your or an employee's overtime balance is incorrect, it could have various causes. Check the following points:
The employee's contract. Does it start on a Monday and on the correct date? If the contract has an end date, no overtime or undertime will be calculated after this end date.
The contract type, has anything been adjusted to the percentage by which overtime is calculated?
Overtime from previous years. TimeChimp always carries over the balance from the previous year to the new year. In the employee's dashboard > overtime, you can see each week how many hours have been deducted or added.
The employee's dashboard. Here you can see each week how many overtime hours have been added or subtracted. This way, you can also see in which week there may have been too many or too few hours added. Check this week in the 'Overviews' of this employee.