# Time Billing ## Work Contracts Work contracts are used to set several financial, management accounting & time sheet valuation criteria for user's employment / work relationship with the Organization. [](https://help.atollon.com/uploads/images/gallery/2020-03/Work-Contracts.png) Each worker (user) should have **VALID** work contract in case you want **Time Sheet Valuation** & **Capacity Planning** to work properly. ## Time Sheet Valuation It is necessary to set-up Work Contract in case you want to add rates to User's Time Sheet records automatically. Please note that **Work Price List** set-up on **Project** or **Folder** (Client) level for either **wage** (internal rate) or **price** (external rate) has **higher priority** than the Work Contract. Please do not forget to enter all values, specifically:
User | Select the worker (must be system user, even without access to system) |
Contract Type | Select the role for pricing (seniority or formal relationship with the worker) |
Valid from | When is the contract valid from (required criteria) |
Employer | Select who's the worker's contractor. If the worker is self-employed, just keep the Organization name. |
Wage type | Select the type of internal costs. In case you want to use this criteria for estimation of labour costs, keep it Hourly rate. |
Wage | Add the value of (hourly) rate |
Price type | Set what's the type of rate (usually hourly would be used, it does not have direct effect on billing in case the contract with client is set-up differently than time-based billing) |
Price | Add the value of (hourly) rate |
Tracking Category 1, 2, 3 | Other columns may represent your system settings of Tracking Categories, ie Cost Centre, Organization Unit, etc. This value is automatically entered to User's Time Sheet record. |