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Hi john sir, kindly help me on following two areas:
1# Under hourly based payment system , formula to calculate is :
wages= no.of hours actually worked * Rate
My question is that in this system we do not pay for idle time? what is meant by payment of hours actually worked. plz explain
2# If we are performing a job at customer request then premium is traceable on that specific job so that is considered direct cost. suppose similiarly there might be idle time during performing that job payment of which will also be traceable on that specific job. would idle time then be treated as direct cost?
1) On an hourly based system, you certainly pay them by the hour. Usually we pay them for whatever number of hours they are in the building (whether they are working or idle). It is not necessarily their fault that they are idle – for example the machine may have broken down.
2) Yes – the idle time would usually be treated as a direct cost as well.
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