For employees who don’t work full time, the real amount of time they spend on research and development should be stated. The unit of measurement for the given data is the equivalent of full employment.
Full-time equivalent (FTE) is a unit of measurement of employees that allows comparability of employees even though they work a different number of hours in a working week/year. Keep reading to learn more about full-time equivalent.
Full-Time Equivalent Calculation
Full-time equivalent or FTE is a measurement of the number of people who are employed by an organization. It is calculated by taking the number of hours worked in a week and dividing it by 40 hours.
The FTE calculation is used to calculate benefits for employees such as healthcare, vacation, and retirement. It also helps to determine how many people are needed to cover shifts or work on a project. A Full-time Equivalent Calculator is designed with the aim of calculating FTE. It’s easy to use and very fast when it comes to providing results.
In order to calculate the FTE for an organization or firm, you need to know two things: how many hours employees work in a week and what the hourly wage is. For example, if an employee works 40 hours per week at $10 per hour, then they would have an FTE of 2 because they work at $10 per hour for 2 hours each day. Read on to learn how it is calculated.
Full-Time Equivalent Formula: How to Calculate It?
FTE = Total Hours Worked / Annual Full-Time Hours
A full-time employee is measured as one (1) full-time equivalent or abbreviated FTE = 1. An employee who does not work full-time receives a proportional value regarding the hours spent on work.
For example, if an employee does not work full time but 1,000 hours a year (Total hours worked) instead of 1,500 (Annual Full-time hours), an FTE will be 0.667. Here’s an example that can help you understand how to use the aforementioned formula:
FTE = 1,000 / 1,500
FTE = 0.667
As you can see, it’s just ridiculous how simple it is. This is why you don’t have to worry about being loaded with too much data.
How Does It Work?
In some cases, it is more practical to express FTE staff on a particular day. However, if there are significant variations, exceptions need to be made to ensure comparability with FTE over a while.
If a fixed-date approach is used, data must be provided for the first or last date for which costs are shown. It is also recommended to use a two-year average to compare cost data. Theoretically, the reduction of FTE is performed for all engaged personnel. In practice, all those participating with more than 90% of the time should be counted as 1 FTE, while those engaged with less than 10% should be excluded from the evaluation.
When calculating the FTE value, it should be borne in mind that an equal calendar year has an average of 252 working days. With that being said, a calculation is performed to determine the full employment equivalent.
The research proposes one of four ways to determine the intensity of engagement (FTE coefficient):
- defined in a specific legal act
- self-assessment of staff with the existence of a system of records
- assessment of the management of the organizational unit
- assessment of the institution’s management
Full-Time and Part-Time Work
At the time of the pandemic, the working hours were further “blurred” because most people worked from home. Many companies have introduced the following rule: a part of the staff is required to work one week while the other part needs to work every other week. This means that employees work two weeks a month, eight hours a day.
The law stipulates that full-time work is 40 hours per week. While full-time work can be less than 40 hours, it cannot be shorter than 36 working hours per week. The employee exercises all rights from the employment relationship based on full-time work.
The right to use annual leave
The employee is entitled to the use of annual leave depending on the number of months he spent in employment, regardless of the number of hours in that period. As prescribed by the Labor Law, a worker is entitled to a certain number of days of annual leave.
That right belongs to the worker no matter if he/she is employed full-time or part-time, except for the employee entering or terminating employment during that year. A characteristic of the annual leave used by a part-time employee is that the employee can exercise the right to salary compensation only for those hours that he would spend at the workplace.
What if a worker is employed by one employer on a part-time basis? He or she is entitled (in any case) to use the entire annual leave of a certain number of working days for one year of work spent with that employer.
When it comes to the workers who are employed by two or more part-time employers, they also exercise the same rights (a certain number of days of annual leave). However, in this situation, employers must reach an agreement and allow the employee to use the holiday at the same time. This allows them to enjoy the benefits of vacation.
Part-time work
To complete the topic about full-time equivalent, we will also explain the concept of part-time work. In this section, you will find out more about this form of employee engagement, how it works, and when it occurs.
The Labor Law defines the term reduced working hours, which relates to difficult and dangerous work. In addition to protective equipment as well as defined measures of safety and protection at work, this also means increased harmful effects on the health of workers.
For workers engaged in these jobs, working hours are reduced in proportion to the harmful effects of working conditions. It depends on the health and working ability of employees, so there is a maximum of ten hours per week.
Workers are able to exercise all rights from employment as if they were working full time. Part-time employees cannot be assigned overtime work. Besides, the redistribution of working hours can’t be made.
Work experience during part-time employment
The Law on Pension and Disability Insurance stipulates that no matter whether a worker is employed full-time or part-time, the length of service is counted as if he/she was working full-time. This stems from the fact that the provisions of this law indicate that the length of service includes the time spent at work, i.e., the period of time during which contributions for the employee were paid.