Is it correct to say that if we are using manufacturing routing, the BOM should not contain the labor component because it is handled by the manufacturing cost template already?

You are correct. The Cost Template Should handle Labor Run, Labor Setup, Machine Run and Machine Setup. You will build our times for each in the routing sequence step. The nice thing about cost templates is having the ability to build out granular costs at the routing sequence level. I hope this helps.

Thank you!