Non-billable work affects margins and capacity. Everhour turns tracked hours into reports teams can review.
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Use this page to separate work that earns client revenue from work that supports the business but stays off the invoice. Common non-billable categories include internal meetings, admin work, training, sales calls, rework outside a billable scope, and project management time that a contract excludes from billing.
A useful record shows the date, person, project or client, task, duration, and billing status. U.S. users normally record money fields in USD when rates or project costs apply. For covered employers, FLSA records for non-exempt workers must include hours worked each workday and total hours worked each workweek.
Track non-billable time at the same level of detail as billable time. A line such as "Client A, onboarding meeting, 1.25 hours, non-billable" is easier to review than a weekly bucket called "admin." The label tells the billing team to exclude it from the invoice while still preserving the effort for margin and staffing reports.
Teams usually need at least three labels: billable, non-billable client work, and internal work. That split shows whether time is being lost to scope exceptions, sales support, training, or general operations. For covered non-exempt employees, payroll review still follows hours actually worked, regardless of whether the time is billable to a client.
The common mistake is treating non-billable time as invisible because it will not appear on an invoice. That hides the real cost of a client or project. If a fixed-fee account receives 12 hours of internal support every month, profitability drops even though billed revenue stays the same.
Use a consistent reason code when time is excluded from billing. Rework, client goodwill, presales, internal review, and contract-excluded project management all mean different things. Clear labels let owners decide whether to adjust scopes, change rates, improve estimates, or accept the time as a planned cost of doing business.
A one-off weekly total works when you only need a quick split between billable and non-billable hours. It is enough for a freelancer reviewing a small client week or an owner checking whether internal meetings crowded out project work.
A managed workflow is better when tracked time feeds billing, payroll review, project budgets, and profitability reporting. Everhour Reporting can group time by client, project, member, billable status, labor cost, profit, invoice status, and other columns, then export reports in CSV, Excel/XLSX, or PDF for review.
This content is for general information only, may not be fully up to date, and is provided without any warranty or liability.
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Non-billable time is work time that does not get charged to a client invoice. It can include internal meetings, admin work, training, sales calls, rework outside a billable scope, or client support that a contract excludes from billing. The time still matters because it affects capacity, project cost, and profitability.
Client-related non-billable time should stay attached to the client or project because it affects account profitability. General operations, training, company meetings, and admin work usually belong in internal categories. Mixing those groups makes it harder to tell whether a client is consuming unpaid effort or the team is spending time on company overhead.
For covered non-exempt employees under the FLSA, overtime is based on hours worked, not whether the work is billable. Unless exempt, covered employees must receive overtime pay for hours worked over 40 in a fixed 168-hour workweek at not less than one and one-half times the regular rate of pay.
Use categories that support decisions. Common labels include internal admin, training, meetings, presales, client goodwill, rework, project management, and contract-excluded work. Keep the list short enough for consistent use. A category that never changes a billing, staffing, pricing, or scope decision adds clutter.
A single weekly total hides the source of the time. Ten non-billable hours spent on training mean something different from ten non-billable hours spent fixing out-of-scope client work. Detailed entries show whether the issue is internal overhead, poor estimates, unclear contracts, or a client relationship that needs pricing attention.
Everhour Reporting turns logged time, costs, budgets, and project data into customizable reports with 45+ columns. Teams can group and filter by client, project, member, billable time, labor cost, profit, invoice status, and other fields, then download CSV, Excel/XLSX, or PDF files for review.
Track approved hours by client, project, and billing status, then use Everhour Reporting to review costs, margins, and invoice exclusions before non-billable work drains profit.
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