A full-time equivalent employee means an employee who works 40 hours or more, on average, each week. The hours of any employee who works less than 40 hours is calculated as a proportion of a single full-time equivalent employee and aggregated. [SBA interim final rule on loan forgiveness]
To calculate the average number of FTE employees, choose one of the methods below and apply that method consistently to each employee:
- For each employee, calculate the average number of hours paid per week, divide by 40, and round the total to the nearest tenth. The maximum for each employee is capped at 1.0.
- A simplified method that assigns a 1.0 for employees who work 40 hours or more per week and 0.5 for employees who work fewer hours may be used at your election.
Add each employee’s quotient together to determine your average number of FTE employees for a given period.
Note that certain questions in your forgiveness application may ask you to calculate your average number of FTE employees for different periods of time or to compare your average number of employees over different periods, so be sure to account for the correct period of time specified as you are making these calculations.