What a full-time equivalent is and how to calculate it

In our example, Jimmy and Marta would be fte meaning part-time employees. 30-Hour a Week Example – If full-time in your company is 30 hours, then every employee who works 30 hours a week or more is considered full time.

For example, if a company has over 50 FTEs, it will be obliged to provide health insurance. Another advantage of FTE is that it also gives an idea of the company’s size. A full-time employee who works 40 hours per week is equal to one FTE, and a part-time employee working 20 hours per week is equal to 0.5 FTE.

How to Calculate FTEs

If you run payroll weekly, you’ll likely have this data available. But if you pay monthly or semimonthly, you may have to divide the number of available work hours in the month by the number of hours the employee worked, on average, to calculate your actual FTE. To determine this amount, ask yourself, what do you expect a full-time employee to work in terms of hours per week? For the purposes of calculating FTE, most employers consider a full-time employee one who works between hours a week.

This, therefore allows them to make better decisions regarding personnel management. Restaurant budgeting doesn’t have to be difficult or stressful. Here’s how to create a restaurant budget that works for your business…. Finally, run reports to see what you charge your clients, what you pay your employees, and whether you are making a profit . Finally, the third method is based on the weeks-worked equivalency. Bear in mind that this is just the expected number of hours Olivia may work with a 0.7 FTE — she will likely use some of these hours for PTO.

ACA Full Time Equivalent Calculator

If your business considers 40 hours to be a full-time workweek, then an employee working 40 hours per week would have an FTE of 1.0. In contrast, a part-time employee working only 20 hours per week would have an FTE of 0.5—which shows that their hours worked are equivalent to half of a full-time employee. To calculate FTE, identify the total number of hours worked by part-time employees during a particular time period. Then, calculate the total number of hours worked by full-time employees for that same time period. Add the hours worked by full-time and part-time employees together, then divide that number by the total hours worked by full-time employees to determine the FTE for that particular period.