It is easy to miss. 100 If this is you, you’re in the right place. If it is a “1” or higher, there was no reduction in the number of FTEs … In this post, we’ll show you exactly how to calculate the number of full-time equivalents you have on your team. The employer could not restore business to a comparable level of activity because of social distancing or other Federal health guidance. You must add your full-time and part-time FTEs together to get your total FTE. There are two eligible methods for calculating your FTEs during the covered and base period: The PPP application provides several exceptions in regard to counting FTEs during the covered period, namely, if any employee rejects a written good-faith re-hire offer, or if an employee was fired during the covered period for cause, voluntarily resigned, or voluntarily requested a reduction of their hours. Next, add your full-time employee count (which is 20) with 8, and you’ll have an FTE number of 28. If you fail both Safe Harbor 1 and 2, you will be assessed an FTE reduction penalty which is calculated as your average FTE from your chosen covered period divided by the average FTE from the chosen reference period. The next step is comparing your average FTE as of the earlier of the date the loan forgiveness application is submitted or December 31, 2020 to the FTE count as of February 15, 2020. 1. 7500 Security Boulevard, Baltimore, MD 21244. The FTE reduction quotient is multiplied by the total PPP loan amount to arrive at your maximum forgiveness amount. PPP Schedule A Worksheet has Table 1 and Table 2 which asks for employee name, employee identifier, cash compensation, average FTE, and salary/hourly wage reduction. The first round of PPP funds went out April 3, 2020—and the small businesses that received funding in early April are coming to the end of the eight-week period following loan origination and having to navigate forgiveness options and fill out the PPP Loan Forgiveness Application. The first way to calculate FTE is to take the average number of hours paid each week, divide by 40, and round to the nearest tenth. The FTE calculation (and definition) can be confusing at first, so we’re here to help you make sense of it all. Now take your current FTE number and divide it by the FTE number from time period A or B (you may also try it with both time periods, and you can choose to select whatever result is largest). To get your total FTE you just have to multiply 10 by 25, which is 250. Text HELP for help. If you weren’t an employer then, enter the average weekly hours for each part-time employee you expect to employ during the current calendar year. The people that help you help your people. The borrower is able to choose the base period that is most beneficial; either 02/19/19 through 06/30/19 or 01/01/20 through 02/29/20. As businesses have begun to wrap up their Paycheck Protection Program (“PPP”) loan covered period or decide whether to extend a little longer, the number one question is around the full-time employee equivalent (“FTE” or “FTEE”) calculation. So if you have 10 full-time employees working for you, that equates to 10 FTEs. One of the key features of these loans is that they’re forgivable if certain guidelines are followed. Five of the part-time employees average 20 hours worked each week, and the other five average 15 hours worked each week. Ste 100 Hillsboro, Oregon 97124 … The borrower’s count of FTE employees during their covered period is divided by the FTE count from the selected base period. (If your company employs independent contractors, it’s important to note that any payments made to independent contractors are not eligible for loan forgiveness and should not be included in your calculations.). Round down, and you’ll have 8 FTEs. To calculate the FTE equivalent for Company A by applying the above formula will be as follows: Let’s say, each part-time employee works 4 hours a day, that is 20 hours per. So, even if you have salaried employees that work 60 hours a week, they wouldn’t equal 1.5 FTE (60 hours paid each week / 40 = 1.5) because FTE can’t exceed 1.0. Reminder: It is important to only include those FTE exemptions if the position was unfilled by a new employee. There is more than one way to gather, organize, and analyze the data to calculate average FTE, but let’s follow this example of instructions to demonstrate the process: How do I know which FTE calculation option and reference period to use? We have compiled a listing of commonly asked questions around FTEs and provided some best practices on how to calculate average FTEs for your loan forgiveness application. The Cost worksheet tables allow you to modify costs as they change without modifying any cost formulas in the Workload/FTE … If the number in your result is larger than or equal to 1, you have successfully maintained your headcount and you meet this requirement for loan forgiveness. All rights reserved. The employers could not find a qualified employee to hire. Ste 100 Message frequency varies, but you may receive up to one message per week during Open Enrollment. First, you must add all of your part-time workers together. Any employees who work less than 40 hours a week will have their hours added together to obtain their value. Add their average numbers together. Get out of the chair, take your eyes off the computer, and recharge your batteries. The first way to calculate FTE is to take the average number of hours paid each week, divide by 40, and round to the nearest tenth. It may even help to write the name of each part-time worker if you don’t have too many. Please note that those who applied for a PPP loan have a simpler process. You can elect the option that is more favorable to you and that option must be used to calculate all FTEs for all reference periods. So you’re probably asking yourself “What is an FTE? You’re fine with what you’ve got. If the number in your result is larger than or equal to 1, you have successfully maintained your headcount and you meet this requirement for loan forgiveness. Lucky Lanes has applied for, and has been granted a PPP loan from the SBA and needs to now calculate the number of full-time equivalent employees (or FTE number). On the other hand, recognition of FTE caps out at 1.0. Round the decimal down to the nearest whole number. If you did, then this safe harbor may apply to you. On the summary tab, sum up the data columns for each payroll period and include under the respective time period and payroll period. Add those numbers together. Text STOP to cancel. Add this number to the number of full-time employees you have, and you’re set! Primary provider FTE -> Enter in Field (27) on the application form (4) Primary provider (see instructions for Field 31) information as of 5/31/2020: FTE Worksheet (Form … Determine Your Total Let’s discuss an example: Say Employee A voluntarily quits during Week two of your chosen covered period and you have been unable to fill that position through Week eight, the end of your chosen covered period. Step 3: Now that you’ve calculated the average number of hours for all your part-time workers, add them all together. If you have further questions about qualifying for loan forgiveness or about PPP loans, we advise you to speak with your lender, an SBA representative, or a lawyer. Create a pivot table showing columns of “week ending date” and rows of “employee ID” and “employee name”. Tip: It is beneficial to calculate both options as the results can differ significantly and one will be more favorable to your circumstances. Why should you switch to EddyHR? You need to provide either your email address or mobile phone number. No matter the case, if you need to learn how to calculate FTEs, we’ve got you covered. Rather than make a guess on what to do in this situation, we will update the article when more information about this scenario is provided. Thus the sum of weekly hours worked by all part-time employees is 10 X 20 = 200. We’re not the only people who talk about us. We believe it is best to have as much documentation in place as possible to facilitate the forgiveness process and audit process should you be audited by the SBA. Please remember this is not based on FTEs; rather, this is based on the definition used by the Small Business Administration (SBA) and counts each employee as one. The Alternative Covered period can be helpful when you increased your FTEs over the forgiveness period as the APCP can allow for a later payroll to be included than would be included in the Covered Period. Staffing Plan: Workload, FTE, & Cost Calculation Workbook Guide This staffing plan template calculates workload, FTE (full time equivalent) requirements, and process activity costs. This allows your average for this employee to not be impacted by their choice to terminate and your inability to fill the position. Two options of calculating the number of FTEs are provided: (1) calculating based on actual hours worked or (2) simplified approach of using an FTE of 1.0 for employees working 40 hours or more and 0.5 for employees working less than 40 hours in a week. Step 2: For each individual part-time worker, you need to write down the average number of hours they work in a week. The calculation for full-time employees (individuals who work 30 hours per week or more on average) is extremely easy. The Treasury defines a full-time employee as an employee who works 40 or more hours per week, so FTE is calculated on a scale of 1.0, with 1.0 being the equivalent of 40 hours per week. This is understandable as the rules have changed a lot, are quite confusing, and the FTE ratio can have a significant impact on your forgiveness amount. Is my FTE calculation based on all payroll periods included in eligible payroll costs? FTE loan forgiveness calculation #2 If you wanted an easier way to calculate FTE, you could also assign an FTE of 1.0 to all employees that work 40 hours or more per week and an FTE of 0.5 to employees who work less than 40 hours per week. Baseline reference period to determine whether FTE penalties apply. If you have received funds under the Paycheck Protection Program (PPP), you need to know the importance of Full-Time Equivalent (FTE) employees with regard to your loan forgiveness. The scramble to secure PPP loans has been top-of-mind for small business owners. Identify which payroll periods will be used for each FTE calculation for the time periods described above. If you can prove this, you may not need to go through the exercise of calculating your FTEs. The original loan forgiveness application clarified the base hours of 40 hours per week to calculate an FTE. 4. Now that youâre signed up, weâll send you deadline reminders, plus tips about how to get enrolled, stay enrolled, and get the most from your health insurance. For example, if you have 20 full-time employees, their value is 20 FTEs. Article written by: 503-648-0521, 300 SW Columbia Street Ste 201 The next step is determining which calculation option is best for you – Actual or Simplified.
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