Compensation and Benefits Instructor Quiz

Which of the following acts requires that organizations holding federal construction contracts pay laborers and mechanics the prevailing wages of the majority of the employees in the locality where the work is performed? a. Copeland Act b. Davis-Bacon Act c. Fair Labor Standards Act d. Walsh-Healy Public Contracts Act

b

Which of the following reports must be automatically sent to employees? a. workers' compensation notice b. summary plan description (SPD) c. annual report (form 5500) d. compra-ratios

b

A man died suddenly at age 41. His family includes his wife and five children under the age of 12. Which of the following federally mandated benefits can the wife expect to receive? a. Social security death benefits of $255 and monthly income for herself and all dependent children under the age of 18 b. Unemployment insurance coverage for up to 26 weeks c. COBRA health continuation coverage for herself and all dependent children for up to 18 months d. Medicare health care coverage for herself and all dependent children under the age of 18

a

A woman is working for a manufacturing company that employs 100,000 people. In an effort to restructure and reduce costs, the company announces that in six months they will close the plant where the woman is working. Which of the following federally or state-mandated benefits must the employer provide? a. Unemployment benefits if the employee is actively seeking work b. Supplemental unemployment benefits for up to 26 weeks c. A severance compensation and benefits package d. COBRA health continuation coverage for the employee for up to 36 months

a

An employee is earning $8 per hour. The employer has redesigned its pay structure, and the position has been classified as Clerk IV. The pay range for the grade is $9.10 to $12.75 per hour. What term would apply to the employee's pay rate? a. green-circle job b. broad-banded c. career-banded d. red-circle job

a

Avalon Industries is reviewing its compensation strategies. Recent employee surveys have shown a growing dissatisfaction with their pay. The average employee at Avalon has a compa-ratio of 1.08. average compa-ratio is similar for both male and female employees. Avalon has experienced some retention problems in recent years, particularly among middle managers. In the past, Avalon has not used incentive pay, so one of the avenues they are considering is the implementation of an incentive program to help its retention efforts. When constructing an incentive pay system Avalon should take care in how it structures the system. While there are many characteristics of an effective plan, the MOST important one is: a. a strong link between pay and performance b. top management support c. a simple payout formula d. goals that are measurable

a

Avalon Industries is reviewing its compensation strategies. Recent employee surveys have shown a growing dissatisfaction with their pay. The average employee at Avalon has a compa-ratio of 1.08. average compa-ratio is similar for both male and female employees. It has experienced some retention problems in recent years, particularly among middle managers. In the past, Avalon has not used incentive pay, so one of the avenues they are considering is the implementation of an incentive program to help its retention efforts. Given Avalon's average employee compa-ratio, what compensation strategy does it look like they have been using? a. lag strategy b. lead strategy c. match strategy d two-tiered strategy

b

Jayson Technologies is trying to remain competitive in the market while at the same time maintaining internal equity. The challenge is that there is no real compensation structure in place right now and employees are starting to complain. Jayson Technologies has noticed that their competitors are trying to lure away their top employees, and worse yet, some of them are starting to leave. The company has hired a new HR director to identify an appropriate compensation system to implement at Jayson. The company has multiple facilities and one of the challenges facing the new director is to get buy-in across the entire workforce. One challenge for the HR director is to evaluate which threats to the retention of employees are most pressing for Jayson Technologies at this time. What should the new HR director do to gain a better understanding of the issue? a. The HR director should review the data from exit interviews with those leaving the organization as well as implementing "stay" interviews with those employees who remain with the organization b. The HR director should meet with the other members of the top executive team to discuss their perceptions c. Only a few people have left so far, so it might be prudent to wait a little while before taking any actions to make sure it is a significant trend d. Attend a conference discussing the staffing challenges of the 21st century

a

Money put away each year by an employee on a pretax basis for payment of such things and medical and child care expenses is called: a. flexible spending account b. IRA c. core benefits d. none of the above

a

The systematic, rational assessment of jobs to determine their relative internal worth is called: a. job evaluation b. job specificaiton c. job description d. job anlaysis

a

Which of the following factors is not related to salary compression? a. Merit increases that reward existing employees for higher productivity b. Higher starting salaries that compress current employees' salaries c. Recruitment of new college graduates at salaries above those of current jobholders d. Unionized hourly pay increases that overtake supervisory and nonunion hourly rates

a

Which of the items below represents indirect compensation? a. Social Security benefits b. short-term incentive pay c. differential pay d. merit pay

a

Which of the workers below is an independent contractor? a. An auditor who performs a two-week audit of the company's financial records each year b. A salesperson who has an office in his home but reports to the national sales manager c. A word processor who works part-time in the data processing department for $9 per hour d. An executive who has an employment contract with the company regarding change of control

a

Why is employee communication of compensation packages, particularly benefits, so important? a. To increase employee awareness of the employer's attempt to create internal equity b. To ensure that employers are giving away all that they can c. To minimize confusion over such issues as which vacation policy to accept d. To maximize the organization's return on its considerable investment

a

An organization choosing to compete based on being the lowest cost provider will be most apt to select which of the following compensation strategies? a. offer highly contingent incentives based on new product development b. offer incentive opportunities to those who contribute to cost-savings/effective cost-management c. provide the best benefits in the community d. lead the market in base pay to attract the very best people

b

Job grades and pay ranges should reflect which of the following characteristics? a. internal equity, pay rates of employees b. internal equity, external competitiveness c. pay philosophy, job design d. length of service, pay rates of employees

b

A sales representative who spends most of her time acquiring potential customers with the company's product line and providing technical assistance when they have difficulties should probably be paid: a. principally on a volume (sales) incentive b. based only on sales of new products c. a base salary, which represents a large percentage of direct pay d. on an all-commission basis

c

Avalon Industries is reviewing its compensation strategies. Recent employee surveys have shown a growing dissatisfaction with their pay. The average employee at Avalon has a compa-ratio of 1.08. average compa-ratio is similar for both male and female employees. It has experienced some retention problems in recent years, particularly among middle managers. In the past, Avalon has not used incentive pay, so one of the avenues they are considering is the implementation of an incentive program to help its retention efforts. Based on the information given above, what is one likely reason behind employee dissatisfaction with pay? a. comparative-worth b. not competitive at entry-level positions c. pay compression d. pay secrecy

c

Avalon Industries is reviewing its compensation strategies. Recent employee surveys have shown a growing dissatisfaction with their pay. The average employee at Avalon has a compa-ratio of 1.08. average compa-ratio is similar for both male and female employees. It has experienced some retention problems in recent years, particularly among middle managers. In the past, Avalon has not used incentive pay, so one of the avenues they are considering is the implementation of an incentive program to help its retention efforts. One key to a good compensation system is establishing the relative worth of the jobs. While a market pricing approach focuses on external equity; which of the following job evaluation methods is generally considered the most effective in determining the relative worth of jobs within the organization? a. job ranking method b. job classification method c. point method d. factor-comparison method

c

Dodson Plumbing and Supply Company is striving to improve it turnover rate. There is a shortage of qualified labor in the local market so Dodson had made the decision to lead the market on salaries for plumbers. Despite this proactive attempt, Dodson is struggling to attract and retain new talent. Upon further review of their approach, Dodson realized that while their wages exceeded some competitors, the wages were not significantly greater. The bigger problem for Dodson Plumbing and Supply was that the company was significantly deficient when it came to benefits. Not only were competitors offering more, some of the benefits that Dodson employees had access to were being under-utilized. After the needs assessment information is gathered, HR must compare organizational needs, employee needs, and the existing set of benefits. This type of comparison is called: a. a bridge analysis b. a utilization analysis c. a gap analysis d. a cost-benefit analysis

c

Dodson Plumbing and Supply Company is striving to improve it turnover rate. There is a shortage of qualified labor in the local market so Dodson had made the decision to lead the market on salaries for plumbers. Despite this proactive attempt, Dodson is struggling to attract and retain new talent. Upon further review of their approach, Dodson realized that while their wages exceeded some competitors, the wages were not significantly greater. The bigger problem for Dodson Plumbing and Supply was that the company was significantly deficient when it came to benefits. Not only were competitors offering more, some of the benefits that Dodson employees had access to were being under-utilized. To maximize the value of their benefits dollars, Dodson's HR manager needs to conduct a benefits needs assessment. What are the key pieces of information that should be evaluated in this assessment? a. The HR manager needs to look at the costs of turnover, inflation, and the mobility of employees b. The HR manager needs to take into account the market rate, the presence of a union, and the ability to renegotiate benefit terms c. The HR manager needs to review the organization's market strategy and compensation philosophy and analyze company demographics and utilization rates d. The HR manager needs to examine the budget, exit interviews, and focus group data

c

ERISA imposes restrictions on compensation systems affecting (among other things): a. system administrator training b. complaint procedures c. funding and investment requirements d. competitive pay rates

c

Jayson Technologies is trying to remain competitive in the market while at the same time maintaining internal equity. The challenge is that there is no real compensation structure in place right now and employees are starting to complain. Jayson Technologies has noticed that their competitors are trying to lure away their top employees, and worse yet, some of them are starting to leave. The company has hired a new HR director to identify an appropriate compensation system to implement at Jayson. The company has multiple facilities and one of the challenges facing the new director is to get buy-in across the entire workforce. Given the growing criticism of employees, how can the HR director best go about obtaining support for the system that he/she puts into place? a. Ask the top management team to speak out in support of the new compensation system b. Put together a handbook of benefits so employees could easily reference the biggest advantages of working at Jayson Technologies c. Gather compensation data from reputable sources to benchmark how the organization's current compensation stacks up to the market and identify how the proposed system will be competitive d. Identify the top performers in the organization and give them all a 10% increase in compensation in an effort to hold on to top talent

c

Jayson Technologies is trying to remain competitive in the market while at the same time maintaining internal equity. The challenge is that there is no real compensation structure in place right now and employees are starting to complain. Jayson Technologies has noticed that their competitors are trying to lure away their top employees, and worse yet, some of them are starting to leave. The company has hired a new HR director to identify an appropriate compensation system to implement at Jayson. The company has multiple facilities and one of the challenges facing the new director is to get buy-in across the entire workforce. Once a new system is identified, what would be an effective way to communicate the new system to Jayson employees? a. Provide information to employees via social media outlets b. Send out a company-wide e-mail explaining the system c. Have managers present uniform content to their employees in small group meetings and then allow for a question and answer period d. Put together a brochure highlighting the key aspects of the new system and distribute it to all employees

c

Two consecutive years of mandated 10% increases in the minimum wage would probably result in which of the following? a. It would increase pressure for larger pay increases among employees making one to two times the minimum wage b. It would reduce the leverage of employees making one to two times the minimum wage in asking for larger pay increases c. It would cause compression between the lowest-paid workers and more skilled workers in a retail trade employer d. It would increase pressure on the available pool of discretionary funds for pay increases for most employers who have minimum wage employees

c

Which of the following employees must be paid overtime? a. A dock worker who worked 40 hours, including 10 hours on Christmas b. A vice president in charge of operations who worked 50 hours last week c. A nonexempt employee who put in 45 hours last week d. A janitor who worked 30 hours during the workweek and was also paid for 12 hours of vacation time

c

Avalon Industries is reviewing its compensation strategies. Recent employee surveys have shown a growing dissatisfaction with their pay. The average employee at Avalon has a compa-ratio of 1.08. average compa-ratio is similar for both male and female employees. It has experienced some retention problems in recent years, particularly among middle managers. In the past, Avalon has not used incentive pay, so one of the avenues they are considering is the implementation of an incentive program to help its retention efforts. If the nature of the work at Avalon creates interdependence between co-workers; level of incentives should they implement in order to maximize performance? a. group level b. individual level c. organization level d. a combination of group level and individual level

d

Managing compensation at the international level requires all of the following EXCEPT: a. A familiarity with currency relationships and the effect of inflation on compensation b. An understanding of why special allowances must be made c. A knowledge of laws, customs, environments, and employment practices d. Recruitment of new college graduates at salaries above current jobholders

d

Which job evaluation approach will probably best fit a small, growing software company, which needs to continually recruit talent? a. scored questionnaire b. point factor c. linear regression d. market-based

d

Which of the following acts mandates that employees on the same job be paid equally except for differences in seniority, merit, or other conditions unrelated to gender? a. Age Discrimination in Employment Act b. Social Security Act c. National Labor Relations Act d. Equal Pay Act

d