How to Calculate Number of Work Hours in a Year

by Louise Bennett; Updated September 26, 2017
Payroll Folder

When calculating personnel salary budgets and payroll expenses, HR professionals use 2,080 hours per year to represent a full-time employee (FTE). This number includes the total hours a salaried employee will be compensated for throughout the work year. This number is often different from the actual number of hours worked, which is closer to 1,920 depending on company leave and holiday policy.

Calculating Yearly Hours

To calculate the number of hours FTEs are paid for, multiply 40 hours per week by 52 weeks in a year. This gives a total of 2,080 hours your FTE will be compensated for. However, that number will decrease when you subtract the number of federal holidays and the number of vacation days the company allows. Assuming that the company recognizes 10 federal holidays and offers employees 10 paid days of leave, the number of actual work hours is greatly reduced. In this example, we take the total number of work hours (2,080) minus federal holidays (10 days x 8 hours) minus leave days (10 days x 8 hours) for a total of 1,920 hours in the year (2,080-80-80 = 1,920 actual work hours). These numbers may vary if training and additional leave time is offered.

About the Author

Based in central Georgia, Louise Bennett has been writing professionally since 1999. Her business, financial and career articles have appeared in hundreds of print and online publications. She received a bachelor’s degree from Columbus State University. An avid reader, Bennett is currently working on her first novel.

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