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Your salaried staff members work 40×15, a total of 600 hours a week. Your 10 part-time employees work 20×10, a total of 200 hours a week. Similarly, if an employee works 20 hours a week, then there should be two such employees to complete the full-time schedule. These two part-time employees will be considered one full-time employee. If a part-timer completes 10 hours a week, then four such part-timers will constitute one full-time employee.

• By determining your company’s FTE you get a better understanding of how effective and useful your workers are.
• Small businesses are eligible for small-employer health care tax credit — they apply to employers who employ less than 50 full-time equivalent employees.
• Whether an employer is an ALE under the shared responsibility provisions will depend on the size of the organization.
• You should also recognize the difference between FTE and an overall employee headcount.

Using the same formula, the number of part time hours worked amounts to 5,000 hours per year. Sometimes one person can be your FTE 100%, or FTE 1.0, which is another way to call it. An fte calculation for all employees in a company needs to be rounded down to the nearest whole number (usually, 1.0 FTE or greater). If you want to run a business, or you already have one, two important things and skills you need to master are acronyms and math. Because, if you don’t know about this stuff, how else are you going to know how to calculate 0.5 FTE? I bet you feel pretty stressed right now, your head must be hurting… But don’t worry, luckily we are here for you and in this article you will find the answers to all of your questions. In other words, do you know what the full time equivalent is and how it can help you better understand the needs of your organization?

How Many Hours Are in an Annual FTE?

Use this workbook to calculate FTE totals for your progress report. In this article, we’ll discuss what an FTE is, what your FTE number means if you’re an ALE, and how to calculate the number of FTEs in your organization. All plans come with a free, 30-day trial of Toggl Track Premium—no credit card required. Upgrade at the end of the trial or continue using Track for free.

Human resources departments use FTE to standardize the working hours and salaries of part-time employees. For example, half-time workers are 0.5 because they work half the hours of full-time employees and they will receive 0.5 of a full-time salary. The total hours worked is the sum of the number of hours worked by part-time and full-time employees, whereas the number https://www.bookstime.com/ of available full-time hours in a year is most often 2,080. FTE (full-time equivalent) is the unit of measurement that measures the ratio that represents the hours worked by an individual employee within a week, generally from Monday to Friday. After completing the project, you can remove them without any negative effects of the termination of an employee.

Why Calculate the Full Time Equivalent?

Just indicate how many employees work at your company, how many hours they work a week, and for how many weeks. Our model will then instantly calculate the Full Time Equivalent for you. With 14 employees, 7 of which are full-time and 7 part-time, the staffing capacity is 9.04 full-time employees per year. Jennifer Hartman has more than 20 years of writing and content experience, working with small businesses and Fortune 100 companies. For over a decade, Jennifer worked as an HR generalist, providing expertise in accounting, payroll, and HR by implementing payroll and benefits best practices and creating onboarding and employee-relations documentation. Your 55 part-time and full-time employees are equal to 48.68 FTE. Your 36 part-time and full-time employees are equal to 33.5 FTE.

• Suppose you have 17 employees working a total of 20,800 hours in a year.
• FTE counts part-time employees as some fraction of a full-time employee, usually based on the number of hours they work (though depending on the business, there are other ways of measuring a given employee’s contribution).
• The business uses this concept in project management and resource management for staffing decisions.
• For example, you’ll want more hands on deck in a restaurant during the busy holiday and summer seasons.
• For example, at The University of Utah, eligible employees who work the equivalence of 0.50 to 0.74 FTE of a full-time schedule will accrue at 50% of the full-time benefited rate .
• Your FTE employee is someone who works the entire workweek and his total working amount of hours are 2,800 hours per year, breaking down to 5 days a week, 8 hours per day.

The US falls somewhere in the middle when compared to other countries, with 38 hours and 35 minutes of work time per week, on average. 💡To track employee work hours and decide whether your employees are full-time equivalents, try Clockify, our free time tracker for teams. FTE is also used to mean “full time equivalent enrollment” and is used by universities and other educational institutions in a similar fashion to track enrollment of full and part-time students. Rather than work hours, class hours are used, with full-time students being those with a full credit load and part-time students being those taking fewer than 12. However, other schools may use different credit hour calculations for FTE.

Full Time Equivalent (FTE) Formula

It indicates what a company could spend on a part-time employee if they worked full time. Many organizations in the health or technology sector consider 1.0 FTE eligibility for employee benefits like health insurance and retirement plans. A full-time equivalent assists in tallying work hours, salaries, employee productivity, and company’s or workplace’s productivity, as well as calculating how much time an assignment or a project will take. The annual FTE is 2,080 hours, which the company calculates as 8 hours per day and 5 days a week. FTE calculations are also important when determining eligibility for certain federal programs and benefits.

It also allows employers to examine total hours worked across the business rather than looking only at how many full-time and part-time employees are on staff. This standardization is very useful in employment classifications and other areas. For example, business analysts and project managers use FTE to evaluate workload and labor costs. Once they have an estimate of the full-time employees needed to accomplish necessary tasks, they can calculate salaries. This information allows them to forecast a budget for the upcoming year or for a specific project.

What is full-time equivalent and how to calculate it (+ free FTE calculators)

In general terms, full-time equivalent is a unit of measure that plays a role in calculations used in project management and federal programs for eligibility purposes. Enter your employee data into the calculator in the relevant fields. Be sure to check whether the hours worked are entered on a weekly, monthly, or annual basis and edit your data appropriately. Double-check your information before pressing “calculate” to make sure that it is correct. Horizons can support your business by helping you hire full-time employees anywhere in the world.

If your company uses a standard 40-hour workweek, someone who works 30 hours has an FTE value of 0.75. This calculation comes from dividing 30 hours by 40 hours to get 0.75.