Create non-billable people

To set up a non-billable person, set both their utilization target and bill rate to 0 within their profile settings. It should look like this

When you are on the Schedule, you can filter by either billable or non-billable people:

A screenshot of the Non Billable filter on the People Schedule view.

Selecting the Non-Billable filter will show only people whose utilization target and bill rate are 0, and Billable will show all other people.