The U.S. Food and Drug Administration (FDA) recently finalized guidance to help facilities determine their business size under the Preventive Controls for Human Food (PC Human Food) and Preventive Controls for Animal Food (PC Animal Food) rules issued in response to the FDA Food Safety Modernization Act (FSMA).
Under the PC Human Food and PC Animal Foods rules, a facility that is a “small business” may have a later compliance date and certain activities performed by a farm mixed-type facility that is a “small business” are exempt from the preventive controls requirements of the PC rules.
A “small business” is defined in the rules as a business (including any subsidiaries and affiliates) employing fewer than 500 full-time equivalent employees. The limit of 500 employees includes all employees of the business and is not limited to the employees at a particular facility. But what does “full-time equivalent employee” mean? And if you have a business with subsidiaries or affiliates how should you go about determining your number of employees?
This final guidance is designed to answer these questions. The guidance explores key definitions such as “subsidiary,” “affiliate” and “full-time equivalent employee.” It also offers a method for calculating full-time equivalent employees, and examples of the types of situations facilities might experience when trying to decide which employees to count to determine whether they are a small business.