What is a potential drawback of miscalculating FTEs in a business?

Miscalculating Full-Time Equivalents (FTEs) can lead to significant compliance penalties. Organizations often have legal obligations regarding labor laws, benefit mandates, and employee classifications. If FTEs are inaccurately calculated, it can result in the company failing to meet employment standards, not providing necessary benefits, or misclassifying employees, which can trigger fines and legal repercussions. Compliance with regulations is crucial for avoiding costly penalties and maintaining a functional workforce. The financial impact of such penalties can be severe and can detract from the overall resources available for the business.

The other options do not align as closely with the specific consequences of miscalculating FTEs. Exceeding payroll budgets, while a concern, typically relates more to overestimating staff needs rather than miscalculating FTEs. Staff burnout and high levels of employee satisfaction are more indirect effects that may not necessarily stem from accurate or inaccurate FTE calculations.