Productive and non-productive payroll earnings
Payroll systems use different paycodes so that hours are classified differently based on how salaries are earned or paid. The reason to identify the type of hours paid in payroll is three-fold:
to pay hours at a different rate,
to keep time used against a paid time off bank, or
to track time for a productivity system
Productive Hours for Accounting Purposes
Time that is worked is tracked as productive time, that is, when work is produced by employees as a normal course of their job. This can be broken down in separate categories based on the pay rate that is assigned to the employee.
The most common pay code is for regular hours, which also could be called normal or standard hours. A person who is assigned a 40 hour work week that shows up, punches in on time and leaves a...