For example, unearned revenue a school may have a mix of full-time and part-time teachers, and FTE helps standardize those figures for budgeting and compliance. For example, the library sector had the highest average number of FTE positions budgeted, with an average of 20.32 positions in 2024. A company has 2 full-time employees (40 hours each) and 3 part-time employees (10 hours each). A company has 3 full-time employees (40 hours each) and 2 part-time employees (20 hours each). Ever wondered how to accurately measure your team’s workload, especially when dealing with both full-time and part-time staff?
Take control of your time registration
An employee who works 75% of the hours of a full-time worker has a 0.75 FTE. The Paycheck Protection Program (PPP) provides funds for small business owners to help them cover up to 24 weeks of payroll or other expenses, such as utilities and rent. If you, for instance, choose the first method, enter all the actual hours worked (including PTO) and divide that number by 2,080 to get the final FTE. In most cases, you don’t count independent contractors (1099 workers) since they’re not considered employees. If you’re close to the 50-employee mark, use a full time equivalent calculator to see if you qualify as an ALE under the Affordable Care Act—and whether you must provide health coverage. Calculate how many full-time equivalents are needed to meet project deadlines.
FTE Calculation Methods
Plan future hiring needs based on projected workloads and business growth goals using simple, scalable FTE projections. Helps in identifying overstaffing, burnout risks, or gaps in staffing coverage. Now you have your part-timer’s annual https://patrickshotwater.com/blog/accounting-tax-services-fort-lauderdale-fl-cpa/ pay, convert it to an FTE salary with this formula. If businesses or universities count FTEs to qualify for federal programs or meet federal regulations, the federal government will provide those FTE calculation rules. This table provides a quick reference for the FTE value of common part-time weekly work schedules.
What is a full-time equivalent employee?
- To the ACA, employees who work an average of 30 weekly hours are considered full-time.
- FTE calculations should include all hours worked, including overtime, to accurately reflect workforce capacity and costs.
- HR teams calculate FTE to determine how many nurses, doctors, or technicians are needed per shift to meet patient care standards.
- If you’re looking to simplify the process of calculating Full Time Equivalent (FTE), Clockdiary is your go-to solution.
In short, FTE gives companies a clear picture of their staffing needs and helps them make smart decisions. For example, an employee who works for 40 hours per week is considered to be 1.0 FTEs, while one who works 30 hours per week is considered to be 0.75 FTEs. The concept is used to convert the hours worked by several part-time employees into the hours worked by full-time employees.
- Understanding FTE counts allows your organization to conduct cost analyses related to labor expenses, and ultimately update the recruitment budget accordingly.
- Generally, contractors are not counted as FTEs unless they are considered equivalent to full-time employees.
- Before implementing Primetric, it took the company quite a long time to calculate the FTE and generate the report.
- As a result, headcount reflects staffing quantity, while FTE reflects labor capacity.
- Your tax credit is based on wages paid to employees who did not work during the period if your business averaged more than 100 FTEs in 2019.
- Too many staff can lead to inefficiency and higher costs, while too few can result in overload and lower productivity.
- Here’s how you calculate the full-time equivalent salary using a part-time wage.
Step 4: Find Total Hours Worked
As a reminder, the ACA has determined that a full-time workweek is equivalent to 30 hours. The company begins by calculating the number of hours worked by each group of employees. Ideally, you would be using a time tracking platform with reporting features to track this data in one central location.
6 FTE – Understanding 60% Workload
Whether you’re an HR professional estimating staffing needs fte meaning or a small business owner navigating ACA requirements, the FTE formula provides clarity. Full-Time Equivalent (FTE) is a unit that measures an employee’s workload in a way that makes it easier to compare staffing levels across different roles and schedules. Instead of counting headcount alone, FTE expresses work hours as a proportion of a full-time schedule—typically 40 hours per week.