Billable hours versus clocked hours
A technician may be on the clock for a full shift, but not every hour ends up on an invoice. Time spent waiting for parts, waiting for approval, cleaning up, driving between jobs without a travel charge, training or redoing work is usually not billed. Billable hours are only the hours that appear as labor on customer repair lines.
Why they matter
Labor revenue is billable hours times the labor rate actually collected. If a shop pays for many more hours than it bills, its posted labor rate can look healthy while the business loses money. That is why billable hours sit at the center of the effective labor rate, technician efficiency and technician productivity.
How shops measure them
- Add up the labor hours on all invoices for the period.
- Separate customer-paid hours from warranty, internal and no-charge hours.
- Compare with clocked hours from the time clock for the same period.
Ratchet+Wrench describes productivity as hours worked divided by hours available and efficiency as flat-rate hours produced divided by actual hours worked. Billable hours are the "produced" figure in those measures. See how to measure billable hours.
Example only
Illustrative figures: a technician is paid for 40 hours in a week and the invoices show 32 labor hours billed. Billed hours are 80 percent of paid hours. The other 8 hours are a cost the labor rate must cover.
Common leaks
- Diagnostic time that is never written on a repair line.
- Travel time on mobile calls that is not charged.
- Small add-on jobs done without a repair line.
- Comebacks redone at no charge. See comeback.
Good practice
Have technicians clock onto each job, write every task as a repair line, and review unbilled time weekly.
MetaFleet supports the technician time clock, AI invoicing and reports. Get a walkthrough.