DEFINITION: The full-time equivalent is used to determine employer size under the ACA. Any employee working at least 30 hours per week is considered full time. In addition, part-time employees are counted using the full-time equivalent method of adding the total number of hours worked by all part time employees in a month, and dividing by 120.
So if a business has 10 employees who each work 80 hours per month, they would have 800 part-time hours. Dividing by 120 gives us 6.66, and the answer is rounded down to get six full-time equivalent employees.