Permanent Placements
Permanent placements will always be calculated on a salary and a fee.
Gross Profit = the salary the fee is based on divided by 100 x the fee percentage.
True Gross Profit = GP after deducting non-reimbursable costs. These can be added to a placement by using our fees function. This is located on the Finance tab on the placement.
The fee percentage can be either calculated based on the Base Salary field, the Total Package field, a fixed amount/fee or staged fees. Please see below an example, where the fee is based on the base salary:
The 'True Gross Profit' is £100.00 less than the GP. This is because a fee has been added, with the type of fee being a 'Cost'. Only a cost can be used to deduct non-reimbursable costs off the true gross profit.
Staged fees is for retainers and is mainly used by exec search. In this instance when reporting on revenue, the reporting would not need to be extracted from the placement record. The reason for this is the fees should have been added to the Vacancy. This includes the final placement fee. Any financial reporting would therefore come off the fees and not the final placement, otherwise this would be a duplication. Of course using the fees function is optional. It may be any staged fees are being recorded outside of Mercury. If this is the case, then using the placement for revenue reporting would be fine. We do highly recommend our fees functionality, as it does allow everything to be recorded within Mercury, all linked to the appropriate records and can then easily be reported on.
NOTE: The fees functionality can have an approval process associated with it. The consultant can add the fee, send it to the finance approver, they can request the invoice and once received, mark this off as approved.
Contract Placements
Contract placements will always be based on a pay rate and a charge rate. Most commonly it will be based on a daily frequency but could also be hourly (there are other options, such as monthly or annual, but these are rarely used).
NOTE: Setting the Start Date and End Dates will return the number of working days between the two dates, independent of the rate type (hourly, daily, etc.). However, this does not include Bank/Federal holidays, these must be manually accounted for.
As we can see in the above the daily pay to the candidate is £300.00 and the daily charge is £400.00.
There should not be any On-Costs on a contract placement, as this placement type is for contractors who work through a limited or an umbrella company. This is why we have an additional field called Candidate Company. This is not on any other placement type.
If the 'Standard Rate Type' is 'Daily', it will focus on the 'Days Per Week' field and calculate this based on the start and end dates of the assignment.
If the 'Standard Rate Type' is 'Hourly', this will focus on the number of hours in the 'Hours' field.
The Standard Rate Type field can be amended at any time.
Calculated Values
Margin = calculated based on the charge minus the pay amount and displayed as a percentage
Margin value = calculated based on the charge minus the pay amount and displayed as a percentage
Sales value = the charge multiplied by the number of days
Total estimated pay = the pay to the candidate multiplied by the number of days
Total On-costs = N/A on contract
Total Pay With On-costs = NA on contract
Gross profit = total profit made on the whole placement
Weekly margin value = as stated
Total Deductions = N/A on contract
True GP = GP after deducting non-reimbursable costs (as explained above)
True Weekly GP = same as True GP but divided to a weekly value
Each of the above fields has a Currency field associated with it to the right.
Temporary Placements
Temporary placements are the same as Contract but set to be based on PAYE contracts. Therefore, any costs or deductions can manually be added to the placement, either as a fee or a total monetary amount:
This would then deduct the amount from any of the financial fields where On-costs are listed.
NOTE: Setting the Start Date and End Dates will return the number of working days between the two dates, independent of the rate type (hourly, daily, etc.). However, this does not include Bank/Federal holidays, these must be manually accounted for.
FTCs (Fixed Term Contracts)
On a permanent placement, go to Is Fixed Term Contract? on the front page and switch the toggle to Yes it being an FTC:
Once the recorded is saved there will be 'Original End Date' and 'Actual Date' fields.
The 'Fee' field will not automatically calculate the amount from the start date to the end date. This will need to be calculated manually and then entered in. As the 'Fee' field and the 'Fee %' field are linked, it will then calculate the 'Fee %' based on the fee entered. This will not be the accurate fee amount for the placement, so we recommend adding a note in the comments field on the placement and running all revenue reports to include the 'Fee' field and not the 'Fee amount' (this has been raised with our Product Team and may be enhanced in the future).
NOTE: Setting the Start Date and End Dates will return the number of working days between the two dates, independent of the rate type (hourly, daily, etc.). However, this does not include Bank/Federal holidays, these must be manually accounted for.