FTE Calculator: Full-Time Equivalent Employees
Short answer: FTE means full-time equivalent. It turns everyone’s hours into a count of full-time workers. Divide the total hours worked by the hours one full-time employee works in the same period. With a 40-hour week, two employees who each work 20 hours equal 1 FTE. For the ACA, the IRS uses 120 hours a month instead.
Pick a method, enter your hours, and the calculator shows your FTE count. Rules were last checked on Nov 10, 2026.
Enter your numbers to see the result.
Full-time equivalents: 0.00 FTE
Headcount: 0 employees
Total hours: 0 / full-time hours for the period: 40
| Group | Employees | Hours each | Total hours | FTE |
|---|
Hours over full time are counted in full in this tab (one person at 50 hours a week with a 40-hour standard is 1.25 FTE).
Average full-time employees plus FTEs: 0.00, counted as 0.
| Month | Full-time | Other hours | FTEs | Total |
|---|
Seasonal worker exception: if you went over 50 for 120 days or fewer and the extra employees in that time were seasonal workers, you aren’t an ALE. This calculator doesn’t apply the exception.
What ALEs must do: Affordable Care Act compliance for small employers
Get the hours without adding up timesheets. TimeClick’s Hours Report totals hours for every employee for any date range.
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This calculator gives an estimate. It is not tax or legal advice.
What FTE means
FTE stands for full-time equivalent. One FTE is the work of one full-time employee. If your full-time week is 40 hours, then:
- 1 employee working 40 hours a week = 1.0 FTE
- 1 employee working 20 hours a week = 0.5 FTE
- 3 employees working 20 hours a week = 1.5 FTE
Businesses use FTE to compare staffing across locations, to budget labor, to apply for grants and loans that ask for it, and to see whether federal health care rules apply.
How to calculate FTE
FTE = total hours worked by all employees / hours one full-time employee works in the same period
Full-time hours for common periods, with a 40-hour week:
| Period | Full-time hours |
|---|---|
| Week | 40 |
| Two weeks | 80 |
| Month (average) | 173.33 (40 x 52 / 12) |
| Year | 2,080 (40 x 52) |
Example: a shop has 3 full-time employees at 40 hours a week, 4 part-time employees at 20 hours and 1 at 25 hours.
- Total weekly hours: (3 x 40) + (4 x 20) + (1 x 25) = 120 + 80 + 25 = 225
- FTE: 225 / 40 = 5.63
The shop has 8 employees and 5.63 FTEs.
FTE for the ACA 50-employee test
The Affordable Care Act’s employer rules apply to an applicable large employer (ALE): one with at least 50 full-time employees, including full-time equivalents, on average during the prior year. The IRS counts it this way:
- Full-time employees each month: employees with at least 130 hours of service in the month (or an average of 30 a week).
- FTEs each month: add the hours of service of everyone else, counting no more than 120 hours for any one person, and divide by 120.
- Monthly total: full-time employees plus FTEs.
- Annual average: add the 12 monthly totals and divide by 12. Drop any fraction. If the result is 50 or more, you’re an ALE for the current year.
Hours of service include paid hours when no work is done, such as vacation, holidays and sick time.
IRS example: a company has 40 full-time employees every month and 15 part-time employees who each work 60 hours a month.
- Part-time hours: 15 x 60 = 900 a month
- FTEs: 900 / 120 = 7.5 a month
- Monthly total: 40 + 7.5 = 47.5
- Annual average: (47.5 x 12) / 12 = 47.5, which becomes 47
- 47 is under 50, so the company is not an ALE
With 20 part-time employees at 60 hours instead, the FTEs are 1,200 / 120 = 10, the total is 50, and the company is an ALE.
There’s a seasonal worker exception: you aren’t an ALE if you went over 50 for 120 days or fewer in the year and the employees above 50 in that time were seasonal workers. The calculator doesn’t apply it.
Sources: IRS, determining if an employer is an applicable large employer and IRS, identifying full-time employees, checked Nov 10, 2026. For what the rules require once you’re an ALE, see Affordable Care Act compliance for small employers.
Where to get the hours
Both methods need accurate hours for every employee. Payroll reports often show hours paid, which is what the ACA counts. For the basic method, a time clock report for the period works too.
TimeClick’s Hours Report totals hours for each employee for any date range you set, and you can save it as a PDF or CSV. See timesheet and payroll reports. To total a single time card, use the time card calculator. For hours in a year, see how many work hours are in a year.
FTE calculator FAQ
What does FTE mean?
FTE means full-time equivalent. It’s the number of full-time employees your total hours add up to. One FTE is one person working a full-time schedule, such as 40 hours a week.
How do you calculate FTE?
Divide the total hours worked by all employees by the hours one full-time employee works in the same period. With a 40-hour week, 225 hours in a week is 225 / 40 = 5.63 FTEs.
How many hours is 1 FTE?
It depends on your full-time schedule. With a 40-hour week, 1 FTE is 40 hours a week, about 173.33 hours a month or 2,080 hours a year.
Is 0.5 FTE part-time?
Yes. 0.5 FTE is half of a full-time schedule, such as 20 hours a week when full time is 40 hours.
How does the ACA count full-time equivalent employees?
Each month, add the hours of service of employees who aren’t full-time, counting no more than 120 hours per person, and divide by 120. Add that to the full-time count, average the 12 months and drop any fraction. 50 or more makes you an applicable large employer.
What counts as full-time under the ACA?
An employee with at least 30 hours of service a week on average, or 130 hours in a month. Paid time off counts as hours of service.
Is FTE the same as headcount?
No. Headcount is the number of people on payroll. FTE converts their hours into full-time workers, so 8 employees can equal 5.63 FTEs.
Does the small business health care tax credit use the same FTE method?
No. For that credit, the IRS adds up hours paid for the year, counting no more than 2,080 hours per employee, divides by 2,080 and rounds down.