This notion is defined as the amount of hours a full-time employee would work. Generally, number of working hours for an FTE is 2,080 hours (40 hours/week for 52 weeks). This concept is used to convert hours worked by part-time employees into hours worked by full time employees. In other words, Full Time Equivalents are useful for various essential measurements within the organisation. A comparison of headcount to profits and revenues are such instances.

However, the “2,080 work hours” do not consider sick days, holidays, vacation, or any other reason for which an employee does not work. In which case, each organisation must then adjust their figure for Full Time Equivalents according to their policies and the quantity of holidays by country. Therefore, the number 2,080 is simply a “theoretical standard” and should not be used as an organisation’s true FTE.

References:

• https://www.accountingtools.com/articles/how-to-calculate-ftes.html#:~:text=An%20FTE%20is%20the%20hours,5%20work%20days%20per%20week