Contractors are a vital part of any business organization, offering their skills and expertise for specific projects or tasks. But when it comes to calculating an organization`s full-time-equivalent (FTE) employee count, the role of contractors can be a bit murky.

The short answer to the question « are contractors included in FTE » is: it depends.

First, let`s define FTE. An FTE employee is a full-time employee who works a standard number of hours per week, typically 40 hours. FTE is used to calculate employee benefits, as well as to determine staffing levels and budgeting needs.

Now, back to contractors. In general, contractors are not included in an organization`s FTE count. This is because contractors are not considered regular employees, but rather temporary workers who are hired for a specific job or project.

However, there are some caveats to this rule. For example, if a contractor works a significant number of hours per week, or if they work for an extended period of time, they may be considered part-time or even full-time employees for FTE calculation purposes.

Another factor to consider is whether the contractor is classified as an independent contractor or an employee. The Internal Revenue Service (IRS) has specific rules for determining worker classification, which can impact FTE calculations.

If a worker is classified as an independent contractor, they are typically not included in an organization`s FTE count. However, if a worker is deemed an employee, they would be included in the FTE count as either a part-time or full-time employee, depending on the number of hours they work.

In summary, whether contractors are included in an organization`s FTE count depends on the specifics of the situation. In general, contractors are not included in FTE calculations, but there are exceptions based on the number of hours worked and worker classification. It`s always best to consult with a human resources professional or accountant to ensure accurate FTE calculations.