Full-time equivalent employees (FTE)

FTE is a combination of full-time employees and part-time employee hours aggregated to account for full-time work.

If you own a business, you know there are two primary types of employees: full time and part time. Full-time employees generally work 30 or more hours a week, and part-time employees work less than that.

There’s another way to represent your staff for insurance purposes called full-time equivalent employees (FTE). This representation helps us get a sense of your company’s size by accounting for the total hours worked by all employees (anyone who receives W2s and isn’t an independent contractor).

To find out how many full-time equivalent employees your company has, use this simple formula:

full-time employees + (weekly hours worked by part-time employees / 120)

By adding up the total part-time hours worked in a week and dividing by 120 hours, you can include part-timers in your overall headcount as proxy full-timers.