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Contractor [in-depth guide]

Guide contents: Vendor setup | Contact setup | Employee setup | Hourly cost | User access | Vendor cost |Vendor invoice entry | Managing contractors | Mark as paid/unpaid | Resources

For information on contractors to be paid in a foreign currency, please take a look at the Contractor - Foreign currency [in-depth guide].

This guide details the setup and use of employees and/or contacts that have the contractor (aka freelancer) option checked.

When you enable the contractor option, this assumes you are making them a paid user (employee or full user contact) in the system and are assigning them to tasks on projects for which to track time against, to ultimately match their vendor invoice against.

To enter time into Workamajig, you must be a fully paid user. This can be accomplished by making them an employee or a full user contact. The difference is minimal; you can convert them back and forth if you want to limit their access. One advantage of having them be a contact, is they can be made into a free user as needed, so they can still have access but are not able to enter time like a paid user.

NOTE: When using this feature, the cost of the time entered, nor the Vendor Invoice will not be categorized as COGS in the Client and Project P&Ls. instead it will appear as Inside Labor Costs. If you must have it appear as COGS, then do not use the Contractor feature and instead set the hourly cost of the employee to zero and enter the vendor invoice with zero gross.

Vendor setup

  1. Create a vendor company record for the contractor.
  2. In the Vendor setup tab, choose the 1099 Form and Box (i.e. NEC, 01 - Nonemployee Compensation). NOTE: further information on 1099 Reporting
    Vendor_1099_setup.png

  3. SAVE

Contacts

  1. Go to the Contact tab.
  2. Create New contact record by clicking the icon located along the left side of the grid.
  3. Enter the contact information.
  4. Click on ...more > Contact settings
    Contact_Settings.png
  5. Click on Security controls, and deselect 'free login'. Set the user ID/password and security group.
    Security_Controls.png
  6. When you deselect the 'free login' checkbox, the Accounting tab will display. Click the Accounting tab: 
    • Check the box: CONTRACTOR

Contractor_checkbox.png

7. SAVE

NOTES:

  • To add time to a vendor invoice for a Full User Contact, you must have the Company as their Linked Company, in addition to the same Vendor being populated.
  • If the contractor will not be logging into the system immediately, the 'free login' checkbox can be reselected. The data entered will be retained. Deselect the 'free login' checkbox when the Contractor will be working within the system.

Employee setup

  1. Create the employee record.
  2. Click on Employee details: Enter the "employee/contractor" information,
  3. Click on Security controls: enter User ID, password, and select security group.
  4. Click on the Accounting tab to access its options:
    • Check the box: CONTRACTOR

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  1. Under Accounting: Purchasing > Vendor: select 'vendor' from the drop-down or create a new vendor record by clicking Create new vendor. NOTE: Create new vendor link will open a new vendor company record. Update any applicable address information, etc. > Save > Close. This will link the vendor record to the employee record.
    Create_Vendor_Record.png
  2. SAVE

Hourly cost

For a contractor, the hourly cost value is used for the same reason as for an employee, it defines the 'labor net' value per hour. With a contractor, it can also be used to define the 'unit cost' or 'net rate' on the vendor invoice when the vendor invoice is connected to a timesheet entry/entries.

Hourly_Cost_.png

Enter an hourly cost equal to the agreed hourly rate with the contractor. When the vendor invoice is entered, the 'unit cost' will be prepopulated from the 'hourly cost' field. The 'hourly cost' will also set/reset the 'labor net' within the Project.

For example, if the contractor works 8 hours, and the vendor invoice is $800, then populate the hourly cost as $100. This will then help to automate this process.

If the 'hourly cost' field is blank, the vendor invoice will not default in a vendor unit cost. It will then need to be manually entered. This can be added to the vendor invoice in the unit cost field.

NOTE: The unit cost auto-filled, entered, or updated on the vendor invoice will be used for the hourly cost field (labor net) for the contractors' time entries on the project

User access

Just like any other employee, follow the same steps as creating a new employee setup.

Give them a username and password to log into Workamajig.

Assign them to tasks with service and time allocated (this is what you plan on billing the client for).

Have them enter and approve time and mark tasks as done via their Creatives > Today creatives.

TIP:  Once a contractor is done with their work and no longer needs access to Workamajig until the next assignment, then feel free to make their employee record inactive.  If the contractor is set up as a contact, then check the 'free user login' checkbox.

Vendor cost

From the Contact record > Accounting tab > Purchasing > Vendor cost

This is used for multi-currency vendors to define the unit net value on vendor invoices. This should be left blank if not using multi-currency.

contactVenCost.png

Vendor invoice entry

When you receive their vendor invoice for the work performed, create a new vendor invoice. Do not enter any project information or amounts. Only the basic information, such as vendor invoice number and dates needs to be entered.

New_Vendor_Invoice_Entry.png

The only difference now is that this vendor will be linked to a contractor record, and a new tab for time entries will appear on the vendor invoice. Click on the + to link the time entries for this vendor invoice. You then select the time entries that correspond with this vendor invoice.

Link_Time_Entries.png

The total cost of the vendor invoice will then be pulled from the time entries selected. The system will default the hourly cost from the employee record, if it was entered, as the unit cost for each time entry. If necessary, you can update those time entries with a unit cost to match the vendor invoice amount.

NOTE: Any change/update to the unit cost will update the hourly cost (labor net) value on the contractors' time entry on the project.

The billable gross of those time entries comes from the service used by default or based on how the project is set up to calculate labor rates for billing the client.

Finally, approve the post, and pay the vendor invoice.

NOTE: The vendor invoice lines will NOT include the project number since the hourly cost on those time entries has already been applied against that project. If a project number were added to this vendor invoice, it would then double up the cost against the project.

Managing contractors

Employees

You can modify your employees list to have either a grouping by the Contractor field or a separate list for all contractors. And then, you can use the Update multiple buttons to make them 'active' or 'inactive'.

NOTE: Inactive employees cannot log in or enter time. If you want them to continue to have a free level of access without the ability to enter time, then you can convert the employee to a contact, but then be sure to check 'free login' from the contact record in Login settings.

Contacts

You can modify your contacts list to have either a grouping by the Contractor field or a separate list for all contractors.

To make a contact record 'active/inactive' or to check 'free login', you will need to open the individual contact record.

Mark as paid/unpaid

Below the Contractor checkbox is an option to Update the time entries to mark as 'paid' or 'unpaid'.

If the user record has previous time entries that were already paid or you have a change in the process, you can Update those prior time entries and mark them as paid. This way, those time entries flagged will not show in the vendor invoice to apply.

And don't worry, if you make a mistake, you can set the time entries back to 'unpaid'.

NOTE:  If time entries are to be 'marked as paid' and no vendor invoice is to be entered, then you will want to be sure to enter the hourly cost on the contractor record.  This will set the labor net cost on the project for their time. Otherwise, if the Hourly cost field is left blank, the unit cost on the vendor invoice will set the labor net. However, if you do not enter a vendor invoice, the labor net may not provide an accurate cost to the project.

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Resources

Add new employee [in-depth guide]

Salesperson > Contacts page [guide]

Vendor setup [in-depth guide]

 

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