# Terminology

This table shows the definitions and formulas for the variables that are used for salary calculations:

Term Definition
annual hours Number of hours that an employee must work in a year to be considered a full-time employee.
base rate For hourly positions, this is the hourly rate. For annual positions, this is the annual rate. The base rate for a position can change over time. Each position has a base salary action that contains the starting base rate. `BaseRateAmountChange` and `BaseRatePercentChange` actions can be used to increase the FTE value to be used when calculating an action amount for a specific period. The action can start or end any time during a period and the FTE can change one or more times during the period.
current base rate The base rate at the current point in time. It includes the starting base rate that is contained in the base salary action and all base rate increases that occurred previously. For hourly positions, the current base rate is the hourly rate. For annual positions, it is the annual rate. Current base rate actions can be used to increase the base rate on a specified date.
Full Time Equivalent (FTE)

FTE determines whether a position is full-time or part-time. An FTE value of 1 represents a full-time position. An FTE value of 0.5 represents a part-time position with half the number of hours of a full-time position.

You can convert between FTE and hours per pay period using these formulas:

``FTE = (Hours per pay period x Number of pay periods) / Annual hours``
``Hours per pay period = (FTE x Annual hours)/ Number of pay periods ``

FTE can change over time. For example, a position could have these FTE values:

• starting on January 1, 2017, FTE equals 1,
• starting on June 1, 2017, FTE equals 0.5.
FTE for this period

FTE value to is used when calculating an action amount for a specific period. The action can start or end any time during a period and the FTE can change one or more times during the period.

For example, an action X starts on Feb 10, 2017 and ends on Feb 27, 2017. The FTE values are 1.5 starting Feb 1, 2017 and 1.25 starting Feb 17, 2017.

For action X, the FTE for February is:

``FTE for February = (7/28) x 1.5 + (11/28) x 1.25 ``

Each position is assigned a headcount that is the authorized number of employees that can be assigned to the position. This is also known as the authorized headcount. The headcount can change over time.

For example, a position could have these headcount values: from January 1, 2017, the headcount is 5 and from June 1, 2017, the headcount is 7.

hours

Number of hours worked per pay period. Hours can change over time.

For example, a position could have these hours values: from January 1, 2017 there are 40 hours and from June 1, 2017, 46 hours.

hours for this period

Number of hours to be used when calculating an action amount for a specific period. The action can start or end any time during a period and the hours can change one or more times during the period.

For example, an action X starts on February 10, 2017 and ends on February 27, 2017.

The hours change according to this schedule: from February 1, 2017, the number of hours equals 50, and starting from February 17, 2017, the number of hours is 45.

For action X, the hours for February are calculated according to this formula:

``Hours for February = (7/28) x 50 + (11/28) x 45``
number of pay periods Number of pay periods in a year.
phasing factor for this period

Phasing factors are used to spread an annual amount over the periods in a year. The user defines phasing methods which are made up of phasing weights. One weight is specified for each period in the year. The weights can vary from period to period.

To calculate the phasing factor for a specific phasing method and period, this formula is used:

``Phasing factor for this period = Phasing weight for this period / Total of all phasing weights for the year``

For example, the even phasing method has a weight of 1 in each period. For this phasing method, the phasing factor is 1/12 in every period because there are 12 periods in the year.

proration factor for this period

For some actions, depending on the calculation type of the action, the first and last period amounts are prorated. This is done by multiplying the action amount by a proration factor. The proration factor is calculated as:

``Proration factor for this period = Number of days in this period for which the action is effective / Total number of days in this period``

For example, if an action starts on April 16, 2017, the proration factor for April for this action would be 15/30.