A method of a floating frame of reference that performs splitting of a deformable solid into rigid and deforming parts is presented within the context of non-smooth contact dynamics. The decomposition is made in such a way that the deforming part of the velocity field does not contribute either to the motion of the center of mass or the rotational motion. The corresponding numerical method that computes both rigid and deforming motions is presented and extended to multi-body dynamics simulation allowing non-smooth contact interactions, such as impacts and friction. Numerical experiments, where the method is compared with a more traditionally used Total Lagrangian method, justify its preference as a more efficient tool for the simulation of assemblies of stiff and massive objects.