Changes in FTE (Full-Time Equivalency)
The full-time equivalency (or FTE) is calculated based upon a full time schedule. Most Rice University staff members are full time (or 1.0 FTE), working 40 hours each week, 52 weeks per year for a total of 2,080 hours a year. A change in the total number of hours a staff member works each year may result in a change in FTE. This will depend on the length of time this alternative schedule is being worked.
Less Than Four Weeks:
Nonexempt: For changes in FTE that are less than four weeks, a Personnel Action Form (PAF) may not be needed as the change in hours for nonexempt employees will be reflected in their pay with the additional or reduced hours being recorded on the time sheet. Refer to step No. 1 in the next section to find out how to calculate FTE.
Exempt: In most cases, it is recommended that no change in FTE is made for short-term or temporary changes in work schedule; however, this will depend on the situation. Contact Compensation for assistance.
Four Weeks or More:
A PAF should be completed and submitted to reflect the change in FTE. To process a change in FTE, follow these steps:
FTE = (Number of hours worked each week X Number of weeks worked each year) / 2080 hours Here are a few examples:
- (40 hours per week x 52 weeks per year) / 2080 hours = 1.0 FTE
- (40 hours per week x 39 weeks per year) / 2080 hours = 0.75 FTE
- (20 hours per week x 52 weeks per year) / 2080 hours = 0.50 FTE
New Salary = (Current annual salary / Current FTE) X New FTE Here are two examples:
- Currently, Sammy the Owl works three days per week (0.6 FTE) and has an annual salary of $30,000 / year. Recently the demands of the department he works in have increased and now his supervisor needs him to work four days per week (0.8 FTE). His new annual salary is $40,000.
- $30,000 / 0.6 FTE = $50,000
- $50,000 X 0.8 FTE = $40,000
- Sammy the Owl is currently in a full-time position, but is going back to school to get his master’s degree. His supervisor has agreed to a reduced work schedule to accommodate Sammy’s personal goals. For three years, Sammy will work half time. His current annual salary is $50,000. Working half time will result in a new annual salary of $25,000.
- $50,000 / 1.0 FTE = $50,000
- $50,000 X 0.5 FTE = $25,000
If you are processing a decrease in FTE, include the following information in the comments section of the PAF:
- Reason for the change in FTE.
- Confirmation that the employee has been made aware of the change in FTE and subsequent change in their annual pay.
For an example of a change in FTE PAF, please refer to the Personnel Actions Handbook.
- The employee is benefits eligible and the change in FTE goes below 0.5 FTE.
- The employee’s current FTE increases to 0.5 or higher.