Indirect labour
Indirect labour is the pay of factory staff—supervisors, maintenance workers, storekeepers—who support production but do not work directly on the product, so it is charged to overhead, not direct labour.
See it move
A bottling plant pays €3,600 to a shift supervisor, maintenance technicians and a warehouse clerk — none of them touch a bottle directly, so this is indirect labour. Added to €900 of indirect materials and €500 of equipment depreciation, total manufacturing overhead is €3,600 plus €900 plus €500, or €5,000, separate from the €14,000 of direct labour traced straight to units produced.
Check yourself
A bottling plant's cost records for June show: machine operators (direct labour) paid €9,000; quality inspectors, cleaners, and a shift supervisor (indirect labour) paid €2,750 in total; indirect materials €430; and factory insurance €320. What is total manufacturing overhead for June?