How is FTE calculated?

The calculation of Full-Time Equivalent (FTE) is based on the total number of hours worked compared to the standard number of hours that constitutes a full-time position. This allows organizations to convert different part-time hours into a single metric that represents full-time workload equivalents.

To determine FTE, you take the total hours worked by employees (part-time and full-time) and divide that by the number of compensable hours that an employee is expected to work in a full-time role over a set period, typically over a week or a month. For instance, if full-time employment is defined as 40 hours per week, you would divide the total hours worked by 40 to calculate the FTE.

This methodology provides a clear and standardized way to assess and compare the workforce's total output regardless of the actual work schedules of individual employees, whether they are working full-time or part-time. Therefore, option B accurately describes how FTE is calculated.