Headcount
Headcount is the number of people you employ at a point in time, with each employee counted once whatever hours they work.
Headcount differs from full-time equivalentsFull-time equivalent (FTE). Full-time equivalent (FTE) is a measure that converts employees’ hours into a number of full-time employees, so several part-time employees can count as one.Click to open the term (FTEs), which convert hours into full-time employees: two employees each scheduled for half your full-time week are a headcount of 2 and 1 FTE. A headcount also depends on its as-of date and on who you include, since employees on leave, seasonal and temporary employees, and future-dated hires can be missed or counted twice. Independent contractors are not employees and stay out. A federal threshold sets its own counting method, so check that method before relying on an internal headcount report.
Do employee-count thresholds use headcount?
Federal discrimination laws count people, not hours, but each threshold sets its own count. The EEOCEEOC. The Equal Employment Opportunity Commission (EEOC) is the federal agency that enforces the laws prohibiting employment discrimination and investigates charges filed against employers.Click to open the term counts every employee, including part-time, seasonal, and temporary employees, for every workday in at least 20 calendar weeks of the current or preceding year; owners and independent contractors are left out. Separate employers with interrelated operations may be counted as one. The COBRACOBRA. COBRA is the federal law that lets eligible employees and their covered dependents continue group health coverage for a limited period after a qualifying event.Click to open the term small-employer exception counts each part-time employee as a fraction instead. An employer below a federal threshold may still be covered by state or local law.
| RULE | THRESHOLD | HOW EMPLOYEES ARE COUNTED |
|---|---|---|
| Title VII, ADA, GINA | 15 or more employees | Each employee counts as one, every workday in 20 or more calendar weeks |
| ADEA | 20 or more employees; state and local governments at any size | The same count, part-time, seasonal, and temporary employees included |
| COBRA small-employer exception | Fewer than 20 employees | Part-time employees count as a fraction, on at least half of typical business days in the preceding calendar year |
- How Do You Count the Number of Employees an Employer Has?
- 26 CFR § 54.4980B-2 - Plans that must comply.
General information, not legal or tax advice. Apply current federal and state rules with qualified guidance.