Hi Samuel
JobCost and Time & Billing cannot both exist on the same installation.
If they simply want to track billable and non-billable staff time, they can enter the time into JobCost using the timecard feature, and code the non-billable time to fake jobs. Then using GridView or Crystal Reports, they can get the report they need. Now, if they want to see more advanced analytical reports such as time utilization reports, or they want to produce invoices that show the time transactions, then they might have a problem.
JobCost timecards can be exported to payroll programs, but it really depends on the payroll program's ability to import. I am not familiar with Canadian payroll modules, but I believe you can also enter timecards into a payroll module which integrates with JobCost. If this is true, and there is custom reporting functionality in the payroll module, then you can get the billable/non-billable report out of there as well.
Adagio JobCost is a really good module - it turns Adagio into a very powerful solution for a very reasonable cost for prospects who have serious job tracking needs. It's a prime reason that users outgrow Quickbooks and Simply. If you are not that familiar with JobCost and want my tricks for how to sell and install it, let me know (I just finished writing such a chapter for the Adagio Consultant's Handbook).
Steve