Chapter 11 test your knowledge - mgmt 3240
Which of the following is an intrinsic reward?
Autonomy
Which of the following statements is true of benchmark jobs?
They are common across different employers.
Which of the following is the most widely used individual incentive?
bonus
In _____ of job evaluation, descriptions of job categories are written and then each job is put into the category it best matches.
the classification method
In the context of developing a base pay system, which of the following methods of determining the worth of jobs in an organization has an external focus?
the market pricing method
The effectiveness of any variable pay program relies on its consistency with:
the organizations culture
Andy is an employee in Pay Grade 2. The pay range for Grade 2 is minimum = $8.50, midpoint = $10.00, and maximum = $11.50. Andy earns $9.30 per hour. Andy's compa-ratio is:
$0.93
Which of the following is a basic assumption that underlies the philosophical foundation of variable pay?
1. Some people or groups contribute more to organizational success than do others. 2. Some people perform better and are more productive than are others. 3. Employees or groups who perform better or contribute more should receive greater compensation.
In the context of the Fair Labor Standards Act (FLSA), which of the following is an overtime pay requirement for nonexempt employees?
1.5 times the regular pay rate for all overtime hours
Richard earns $20 an hour and works a 40-hour week. He receives a 3 percent lump-sum increase (LSI) as his total yearly pay increase. Richard's base pay for the next year will be:
2 per hour
Rhonda earns $20 an hour and works a 40-hour week. She receives a 3 percent lump-sum increase (LSI) as her yearly pay increase. Assuming she works for 2,080 hours in the year, Rhonda receives a lump sum of:
20*3%*2080 = 1 248
Based on a typical pay adjustment matrix, which of the following employees would receive the largest percentage pay increase?
Alex, who is in the second quartile and whose performance exceeds expectations
Which of the following statements regarding broadbanding is NOT accurate?
Broadbanding may lead employees to feel that there are more promotional opportunities.
In the context of pay, which of the following represents valence in expectancy theory?
Employees placing a high value on receiving high commission pay
Which of the following statements regarding overtime pay issues is NOT true?
Employers in the private sector are allowed to offer compensatory time off to nonexempt employees in lieu of payment for extra time worked.
The _____ prohibits companies from using different wage scales for men and women performing substantially the same jobs.
Equal Pay Act
Which of the following is a factor that leads to success in utilizing bonuses?
Establishing clear, metric-based employee reviews
The major federal law that affects compensation is the:
Fair Labor Standards Act.
In the context of HR metrics for compensation, which of the following is a measure of sales incentives?
Increase in market share
Which of the following statements regarding a pay adjustment matrix is NOT accurate?
It is used in a company that has an entitlement philosophy.
In the context of executive compensation, which of the following is true of a clawback provision?
It permits an organization to require an employee to return rewards obtained through unethical or negligent actions.
Which of the following statements is true of the child labor provisions of the Fair Labor Standards Act (FLSA)?
Nonexempt employees are covered by FLSA and include most hourly workers.
Which of the following statements explains the basic concept behind organizational incentive plans?
Overall results depend on company-wide efforts and cooperation.
In the context of HR metrics for compensation, which of the following is a measure of variable pay on the organizational level?
Return on investment
Which of the following is the primary objective of profit sharing plans?
To focus employees on organizational goals
_____ is an indirect reward given to an employee or group of employees as part of membership in an organization, regardless of performance.
a benefit
An example of a tangible direct reward is:
a cash bonus
Which of the following is NOT a criterion for exempt status?
a minimum pay level
To address pay compression, companies can do all of the following:
assess current pay practices consider market conditions endure collaboration between HR and finance staff consult legal counsel
In the context of HR metrics for compensation, which of the following is a measure of base pay?
average hourly rate
Which of the following statements explains the basic concept behind organizational incentive plans
based on how well the entire organization performs (efforts and cooperation)
Which of the following statements regarding the entitlement philosophy is NOT true?
bonuses are given based on merit
_____ is the practice of using fewer pay grades with much wider ranges than in a traditional compensation system.
broad bending
A _____ is a percentage of the revenue generated by sales that is given to an agent or salesperson.
commission
To determine each individual employee's standing in relationship to the midpoint of a pay range, many organizations use a value called the:
compa-ratio
In the context of legal issues, which of the following statements is true of pay surveys?
companies participating in pay surveys mist safeguard employee privacy
A company that follows a pay-for-performance philosophy is most likely to:
compensate satisfactory level
_____ rewards individuals for the capabilities they demonstrate and acquire.
competency-based pay
To determine whether a pay survey is relevant and valid, an organization should ascertain that it:
covers a realistic sample of the employers with whom the organization competes for employees
An example of a tangible, indirect reward is:
dental insurance
The _____ states that individuals judge fairness in compensation by comparing their inputs and outcomes against the inputs and outcomes of referent others.
equity theory
The _____ states that an employee's motivation is based on the probability that his or her efforts will lead to a presumed level of performance that is linked to a valued reward.
expectancy theory of motivation
The expectancy theory of motivation emphasizes the importance of:
finding valued rewards for employees
A company targets pay ranges so that 75 percent of other firms pay above it and 25 percent pay below it. The company is using a _____ strategy.
first-quartile
In a piece-rate system, people are paid:
for the work completed.
Which of the following is a common work unit/team incentive?
gain sharing
Which of the following is one of the primary ways for distributing team incentives?
giving the same size reward to each member of the team
A(n) _____ is an incumbent who is paid below the range set for a job.
green-circled employee
In hotels, which of the following is often used as the basis for providing recognition awards to front-desk representatives, housekeepers, food and beverage workers, and other hourly employees?
guest-comment cards
An exempt employee is an employee who:
holds a position for which he or she is not paid overtime.
An organizational incentive system compensates all employees according to:
how well the organization performs.
_____ are elements of compensation that cannot be easily measured or quantified.
intangible rewards
Which of the following statements is true of gainsharing?
it is a team-level incentive
Which of the following is a disadvantage of market pricing?
it is likely to lead to wide fluctuations in pay
Which of the following statements is true of variable pay?
it shifts some risk to employees
Communicating an organization's pay philosophy to employees is:
likely to enhance younger workers' satisfaction and retention.
In the context of variable pay, the term _____ refers to the idea that employees can clearly see how their actions and decisions lead to desired outcomes.
line of sight
A(n) _____ is a one-time payment of all or part of a yearly pay increase.
lump-sum increase
Which of the following statements regarding minimum wage is NOT accurate?
min wage is adjusted to inflation and cost of living index
In the context of employee pay grades, green-circled problems are likely to be the result of:
opportunistic hiring
Which of the following represents an input in the equity theory of motivation?
pay
_____ occurs when compensation differences among individuals with different levels of experience and performance become small.
pay compression
The term _____ refers to groupings of individual jobs that have approximately the same value to an organization.
pay grades
Which of the following is another term for variable pay?
performance pay
Labor unions are likely to oppose variable pay because they:
prefer that employees be paid fro the amount of time they work
In the context of administrative responsibilities, which of the following HR functions is likely to be the first to be outsourced?
processing payroll
Which of the following job evaluation methods is a simple system that places jobs in order, from highest to lowest?
ranking method
Which of the following represents an outcome in the equity theory of motivation?
recognition
A(n) _____ is an incumbent who is paid above the range set for a job.
red-circled employee
_____ occurs when the pay given to new hires is more than the compensation provided to more senior employees.
salary inversion
Which of the following sales compensation plans is useful when an organization emphasizes serving and retaining existing accounts over generating new sales and accounts?
salary only
In the context of work teams, free riders are also called:
social loafers.
Which of the following is an example of a perquisite?
stress counseling
Firms that have contracts with the U.S. government must pay their employees:
the prevailing wage in their geographic area for similar work
Which of the following statements is true of executive compensation packages?
they are frequently determined by the governing board of directors
Which of the following statements regarding cost-of-living adjustments (COLA) raises is true?
they are given all employees to compensate for inflation and rising prices
Which of the following statements is true of pay surveys?
they are important element for establishing external pay equity
In the context of the administrative responsibilities related to compensation, which of the following statements is true of managers?
they are often the first point of contact for employees with questions about pay fairness
Which of the following statements is true of standardized pay adjustments?
they re used by companies that have an entitlement philosophy
Which of the following statements is true of salaried workers?
they receive the same consistent payments each pay period
Which of the following is the goal of employee stock option plans?
to get employees to think like owners
Which of the following is NOT a reason for adopting variable pay?
to reward employees financially for the amount of time that they work
Which of the following statements regarding lump-sum increase (LSI) plans is NOT accurate?
unions insist on LSI programs as part of a total rewards package
Which of the following is NOT a type of variable pay?
wages
Which of the following is NOT one of the three general types of sales compensation plans?
wages only
