Compensation Final Exam (Ch. 13 - 18) UNL
Steve has a small company with 12 employees. One of his employees, Larry, has been laid off because his work has been outsourced. Larry had health coverage through Steve's company and wants to continue that coverage. According to the Consolidated Omnibus Budget Reconciliation Act, how long can Larry continue his coverage through Steve's company after being laid off?
0 months
Union employees in the public sector earn, on average, about ________ more than their nonunion counterparts.
22 percent
The majority of defined benefit plans calculate average earnings over the last ________ years of service for a prospective retiree.
3 to 5
Total compensation in many organizations makes up at least ________ of operating expenses.
50%
Which of the following is a factor determining base pay in the Japanese traditional national system?
Career category
The ________ specifies the number of breaks that must be provided in an eight-hour workday.
Occupational Safety and Health Administration legislation
Ch. 14
Questions
Ch. 15
Questions
Ch. 16
Questions
Which of the following countries has the highest number of people in the workforce belonging to unions?
Sweden
________ argues that executive pay rises to maintain the same relative relationship with the salaries of lower-level employees.
The social comparison theory
Unlike U.S. companies, Japanese organizations A) encourage flexible workers. B) focus on the shorter term. C) are less egalitarian. D) are market-sensitive.
X
Financially healthy employers may wish to maintain their competitive positions in the labor market or share financial success through
bonuses and profit sharing.
In the majority of states, unemployment insurance is financed exclusively by:
employers that pay federal and state unemployment insurance.
The major potential advantage of outsourcing is
increased cost savings
Today, top executive pay is more than ________ times the pay of the average worker.
300
The differential between supervisors' base pay and their highest paid subordinate is typically ________ percent
5 to 30
Almost ________ percent of the companies offering child care assistance to employees also offer elder care assistance.
50
The average company match for 401(k) retirement plans is ________ on the dollar up to 6 percent of pay.
50 cents
Who among the following has violated the Fair Labor Standards Act of 1938?
Jeremy, who employs his 16-year-old cousin in his meat-packing plant
________ are one-time cash payments to employees that are not added to an employee's base wages.
Lump-sum awards
Which of the following is a benefit under Social Security?
Lump-sum death payments
Ch. 17
Questions
KYZ, Inc., a U.S. firm, sends its manager, Ryan, to London to manage its operations there. Ryan's salary is still based on the U.S. pay system; however, KYZ offers him a lump-sum payment to offset the additional standards-of-living expense in London. In this case, which of the following approaches to expatriate compensation did KYZ use?
The cafeteria approach
_______ sets salaries according to the home-country system and simply offers employees lump sums of money to offset differences in standards of living.
The cafeteria approach
MayFly, Inc., a firm headquartered in Paris, France, sends one of its employees to Frankfurt, Germany, and Barcelona, Spain, to manage its operations in these cities. The employee would be required to alternate between the two cities every six months. Mayfly offers only a moving expense on top of the base pay as the employee would be moving only within European Union countries. Which of the following approaches to expatriate compensation is exemplified in this situation?
The modified balance sheet approach
Which of the following ties salary to a region?
The modified balance sheet approach
MaxTrain Corp. recognizes that its competitor GlasWell Corp., which is unionized, offers higher wages and benefits. To avoid unionization demands from its workers, MaxTrain decides to offer the same wages and benefits to its employees as GlasWell. Which of the following phenomena is exemplified in this case?
The spillover effect
The ________ Act extends the prevailing-wage concept to manufacturers or suppliers of goods for government contracts.
Walsh-Healey Public Contracts
A compensation consultant is hired to survey actual competitors of the company: A) if the CEO is overpaid and the company is doing poorly. B) if the CEO is truly overpaid. C) if the CEO is truly underpaid. D) if the CEO is not underpaid and the company is doing poorly.
X
A(n) ________ uses cash or stock award if specific goals are achieved. A) nonqualified stock option B) incentive stock option C) restricted stock plan D) performance share plan
X
Bottom-up budgeting includes the process of distributing forecasting instructions and worksheets where: A) managers are trained in the concepts of a sound pay-for-performance policy. B) firms furnish managers with the forms and instructions necessary to preplan increases. C) each manager's forecast is examined and changes based on noted inequities are recommended. D) managers are presented statistical summaries of the forecasting data by each department
X
In the context of child labor, which of the following statements is true? A) The steepest declines in child labor in Brazil and Mexico are among children 17 years and younger. B) Population growth in Latin American countries has led to replacement of child laborers with adult workers. C) The lowest rates of child labor are in sub-Saharan Africa. D) Child labor has decreased in most countries across the world in recent years.
X
In the context of contracts, which of the following is most appropriate when the necessary job skills are within the grasp of most employees? A) Merit progression B) A gain-sharing plan C) Automatic progression D) A profit-sharing plan
X
The base salary plus incentives for expatriates is usually determined by
job evaluation.
An Indian citizen working for a Japanese company in India is a
local country national.
Bonuses paid in Japan are
not necessarily related to performance.
When employees are paid more than the maximum of their pay grade, these rates are called A) red circle rates. B) yellow circle rates. C) blue circle rates. D) green triangle rates.
red circle rates.
When designing a sales compensation plan, it should be kept in mind that:
salespeople rank recognition as their number-one motivator.
Which of the following is true regarding a gain-sharing plan?
Not all unions would be in favor of this type of plan.
The CEO of BoardCom, Inc., James, negotiates a new union contract with the union leader. If James wants to reduce expenses and keep the union happy, which of the following suggestions is most likely to be helpful?
Provide lump-sum awards in exchange for merit pay increases.
Ch. 13
Questions
Which of the following benefits is a federally administered program?
Social Security
Replacing merit grids with ________ eliminates the link between the pay increase and the employees' salary position in the range and performance rating A) bands B) skill- or competency-based plans C) job evaluation plans D) bonuses
X
The highest rates of child labor are in A) China. B) India. C) Latin America. D) sub-Saharan Africa.
X
Which of the following is one of the basic steps in establishing a comparable-worth pay plan? A) Adopting multiple gender neutral point job evaluation plans for all jobs within a unit B) Paying jobs with different evaluation results with different wage rates C) Basing the wage-to-job evaluation point ratio on the wages paid for female-dominated jobs D) Identifying the percentages of male and female employees in each job group
X
Which of the following is the basic question to ask to improve quality and ensure that value is added by each technique and at each stage in the compensation system? A) Who should do the activity? B) How should the technique be redesigned? C) Does each specific activity directly contribute to our objectives? D) Should the activity be done in-house, or can others do it more effectively?
X
Which of the following is the least popular executive perk offered by most companies? A) Payment of club dues B) Housing allowance C) Supplemental life insurance D) Home security
X
Which of the following is the most popular executive perk offered by most companies? A) Executive physicals B) Payment of club dues C) Family spousal travel D) Corporate housing
X
Which of the following is true of the Age Discrimination in Employment Act? A) It protects employees aged 30 and over against age discrimination. B) It was amended in 1990 to include the Older Workers Benefit Protection Act. C) It mandates employers with 50 or more employees to provide qualifying health insurance coverage or face financial penalties. D) It formed the Securities and Exchange Commission, which ensures that companies having more than $10 million in assets report information periodically.
X
With easily sold products, A) companies prefer a more aggressive sales force. B) the base compensation tends to be more important. C) the incentives provided in the form of commissions tend to be more important. D) companies tend to set lower sales targets.
X
________ prohibits discrimination on the basis of race, color, religion, sex, or national origin. A) Executive Order 11452 B) The FMLA C) Executive Order 11246 D) The Rehabilitation Act
X
___________________ use cash or stock award that is determined by increase in stock price during any time chosen (by the executive) in the option period. A) Phantom stock plans B) Restricted stock plans C) Stock appreciation rights D) Incentive stock options
X
The denominator for calculating the current year's pay rise is the
average pay at the beginning of the year
Leah, the CEO of SteadyResults Corp., feels that she is underpaid, so she hires a compensation consultant to survey actual competitors of the company. According to agency theory, if SteadyResults performs poorly, her salary will most likely:
be increased in order to retain her.
With gain-sharing plans, the most common union strategy is to
delay taking a stand until real benefits are more apparent.
An employer experiencing high turnover and seeking to reduce pension costs is likely to prefer:
full vesting after three years.
Basically a phenomenon of the union sector, two-tier wage structures differentiate pay based upon the
hiring date.
Which of the following involves periodic adjustments based typically on changes in the consumer price index?
A COLA clause
________ curve expresses the relationship between years since last degree, performance, and salary.
A maturity
In the negotiation stage of a multiyear wage contract, Mark, the manager of SifCo Corp., specifies that changes will be made to the wage based on the changes in the consumer price index and mentions the effective dates of adjustment. Which of the following types of clauses has Mark introduced in the contract?
An escalator clause
________ is movement through the wage ranges where seniority is specified as the basis of the movement.
Automatic progression
____________________ are defined benefit plans that look like a defined contribution plan.
Cash balance plans
________ has produced more comparable-worth pay increases than any other approach.
Collective bargaining
__________________________ designed for employees or managers, explain compensation policies and practices, answer frequently asked questions, and explain how these systems affect their pay.
Communication portals
In which of the following situations would engineering jobs be most likely treated as a special compensation group?
Computer engineers employed at a software firm
The ________ was enacted by the Congress to provide current and former employees and their spouses and dependents with a temporary extension of group health insurance when coverage is A) Health Insurance Portability and Accountability Act B) Social Security Act C) Consolidated Omnibus Budget Reconciliation Act D) Family and Medical Leave Act
Consolidated Omnibus Budget Reconciliation Act
In which of the following types of cases is the focus on the discriminatory consequences rather than the intent to discriminate?
Disparate impact
Which of the following is true of hiring LCNs?
Employment of LCNs satisfies nationalistic demands for hiring locals.
Which of the following statements regarding wage differences in industries and firms is NOT true?
Female employment is more heavily concentrated in large firms.
The ________ is designed to lessen an employer's ability to deny coverage to an employee for a preexisting condition.
HIPAA (Health Insurance Portability and Accountability Act)
Which of the following is a reason for unions favoring gain-sharing plans?
Increased involvement with job activities
Which of the following actions is most likely to be favored by unions?
Introducing lump-sum awards
Which of the following is the most likely reason for most unions to insist on group-based performance measures with equal payouts to members?
It cuts down on strife and internal quarrels.
Which of the following is true of the Affordable Care Act?
It is aimed at expanding health care coverage through an individual mandate to purchase health insurance and an employer mandate to provide qualifying health insurance coverage.
Jacob, an 18-year-old, has been working at HoldVille Corp. for over a year. If HoldVille offers full vesting after one year, which of the following statements is true?
Jacob is not eligible for pension as he is not over 21.
Under the ________, employers can be liable for current pay differences that are a result of discrimination that occurred many years earlier.
Lilly Ledbetter Fair Pay Act
MNTX University requires that all its female professors score higher than the male professors in their appraisal rating to qualify for a pay bonus as there are more female professors than male professors in the university. Which of the following statements is true in this case?
MNTX is liable for disparate treatment of women.
Michael was laid off by his company owing to budget cuts. Before being laid off, he earned $1,000 per week. If he has been receiving unemployment insurance benefits for 26 weeks, which of the following statements is true in this scenario?
Michael is no longer eligible for unemployment benefits.
Ch. 18
Questions
Which of the following statements about ownership and financial markets is true?
Recent tax law changes in many countries have made stock options more attractive, but limited ownership of many companies remains the rule.
Which of the following is a reason for unions opposing gain-sharing plans?
Reduced need for jobs due to increased productivity
Jennifer is hurt at work while driving a forklift. Her employer claims that she was injured as a result of her careless driving and is therefore not eligible for workers' compensation. What will be the outcome of the employer's challenge to her worker's compensation claim?
She will likely receive workers' compensation benefits.
________ is defined by the Department of Labor as experience, training, education, and ability as measured by the performance requirements of a particular job.
Skill
Which of the following includes a provision that requires public companies to set policies to allow executive compensation to be taken back if it was based on inaccurate financial statements that did not comply with accounting standards?
The Dodd-Frank Wall Street Reform and Consumer Protection Act
Susan works in a sterile laboratory that requires her to scrub and put on protective clothing. Which of the following acts determines whether she should be paid for this time?
The Portal-to-Portal Act
________ is an example of a country with a highly decentralized approach to pay setting with higher wage flexibility.
The United States of America
GronLan, Inc., a company with a majority of workers with high seniority, decides to hire 1,000 college graduates to meet the sudden productivity requirements generated by a growth in the market. Which of the following statements is most likely to be happen in this situation?
The average pay actually paid by the company will fall below its range midpoint.
Which of the following approaches seeks to ensure that employees on overseas assignments have the same spending power as they would in their home country?
The balance sheet approach
In the context of the Consolidated Omnibus Budget Reconciliation Act, which of the following statements is true?
The biggest concern for individuals getting health insurance under the Consolidated Omnibus Budget Reconciliation Act is the relatively brief qualifying period.
Which of the following is an objective of the unemployment insurance program?
To provide an incentive for employers to stabilize employment
__________________ is the budgetary approach that begins with an estimate from the highest-ranking executives of the pay increase budget for an entire organization.
Top-down budgeting
What is the first question that should be asked when determining the amount of retirement income an employer should provide?
What level of retirement compensation would the employer like to set as a target, expressed in relation to preretirement earnings?
In the context of Hofstede's national culture dimensions, the "individualism-collectivism" dimension refers to: A) the degree to which people are supposed to look after themselves or remain integrated into groups, usually around the family. B) the extent to which the weak members of organizations and institutions accept and expect that power is distributed unequally. C) the extent to which a culture programs its members to accept delayed gratification of their material, social, and emotional needs. D) the degree to which a culture programs its members to feel either uncomfortable or comfortable in unstructured situations.
X
In the context of the general compensation strategies, identify a true statement about localizers. A) The corporate headquarters and the operating units are heavily networked to share ideas and knowledge. B) Managers around the world share a common vocabulary and a clear message about what the leadership values. C) They are virtually similar to exporters. D) They operate independently of the corporate headquarters.
X
KayLeaf, Inc. wants to set up a unit in Hong Kong. To facilitate this, it sends its manager to Hong Kong to gather information about the culture of Hong Kong. Which of the following is most likely to be a suggestion from its manager? A) To use incentives that are based on an employee's performance B) To ensure that employees remain integrated into groups, usually around their families C) To focus on group-based pay rather than on individual-based pay D) To ensure that all employees are entitled to equal pay increases
X
Which of the following statements is true about the German traditional national system? A) In Germany, companies place much greater emphasis on external markets than on internal alignment. B) Labor markets in Germany remain highly regulated, and tariff agreements set pay for union workers. C) In Germany, workers are entitled to a maximum of 15 days of vacation and receive a maximum of 10 national holidays annually. D) Performance-based bonuses have been an integral part of a traditional German pay system for unionized workers.
X
An early study of the effects of the living wage law in Los Angeles found all of the following EXCEPT that
a higher proportion of new hires were female.
The most common approach to motivating executives to make decisions that are in the best interests of stockholders is
a long-term incentive plan using stock options.
The percentage increase in average pay that is expected for an organizational unit or company is called
a planned pay-level rise.
Increased global competition has caused unions to:
become more receptive to alternate reward systems that link pay to performance.
Popular stereotypes of salespeople characterize them as being heavily motivated by
financial compensation.
A recent article analyzing the results from over 100 executive pay studies shows that the best predictor of executive pay is by far
firm size.
According to Hofstede's cultural dimensions, in Malaysia and Mexico, where there is high power distance, ________ pay structures are appropriate.
hierarchical
Hannah is the CEO of JF Corp., a steel manufacturing company. She finds that the market is exhibiting the signs of a maturing market. She wants to revise the compensation package for her sales employees to adapt to the changing market conditions. In this case, Hannah is most likely to:
increase base pay.
Pay-for-knowledge plans do all of the following EXCEPT
increase the probability of work being subcontracted out to nonunion organizations
Company A and Company B are in the same industry, but Company A is unionized and Company B is not. Therefore,
it is difficult to argue with assurance that wage differences between the two firms are attributable to the presence of a union, although the possibility exists
The determination of pay discrimination on jobs of dissimilar content requires a standard that allows jobs of dissimilar content to be declared comparable and that allows pay differences for jobs that are not comparable. This standard is
job evaluation.
When compared to the impact of unions during strong economies, the impact of unions during periods of higher unemployment is
larger
Traditionally, Japan's employment relationships were supported by
lifetime security within the company.
A health maintenance organization pulls together a group of providers willing to provide services at an agreed upon rate in exchange for employers:
limiting employees to these providers for health services.
The degree of discretion managers have to make total compensation a strategic tool is referred to as
managerial autonomy.
Annual bonuses often play a major role in executive compensation and are primarily designed to
motivate better short-term performance.
In recent years, a stable ________ of all major collective bargaining agreements in the private sector have contained a provision for lump-sum payouts.
one-third
A Japanese citizen working for Toyota in Georgetown, Kentucky, is a
parent-country national.
If improved account retention became a major focus of attention, the performance measure stressed would be
percentage account erosion
In the comparison of the pay systems of two well-known Japanese companies Toyota and Toshiba, Toyota
places greater emphasis on external market rates.
A ________ plan is a hybrid health plan combining the benefits of a health maintenance organization and a ________.
point-of-service; preferred provider organization
In Japan, internal alignment based on ________ is far more important than other factors.
seniority
The Equal Pay Act is a part of the
the Fair Labor Standards Act.
The phenomenon where nonunion management continues to enjoy the freedom from union "interference" in decision making and the workers receive the rewards already obtained by their unionized counterparts is known as
the spillover effect.
A Korean citizen working for Toshiba, a Japanese company, in Canada is a
third-country national.
In a(n) ________ pay plan, a contract is negotiated that specifies that employees hired after a given target date will receive lower wages than their higher-seniority peers working on the same or similar jobs.
two-tier
When taxes are deducted from employees' earnings up to the same amount of taxes they would pay had they remained in their home country, it is known as A) expat tax. B) tax equalization. C) compensatory tax. D) tax protection.
X
The ________ often comes into play if organizations target reductions among higher paid employees because higher paid employees also tend to be older employees.
ADEA (Age Discrimination in Employment Act)
Which of the following statements is true of the localization approach to expatriate compensation?
It ties an expatriate's salary to the host country's salary scales.
Which of the following statements about evolution and change in the traditional German model is true?
Many of the changes in Germany are the result of global competitive pressures and technological changes.
Which of the following groups can qualify for the exemptions under the Fair Labor Standards Act of 1938? A) Computer employees B) Police and other first responders C) Paramedics D) Fire fighters
X
In recent years, some firms have tried to deal with the plateau effect and also accommodate the different career motivations of mature scientists and engineers through a(n)
dual-career ladder.
The biggest trend in supervisory pay centers on
increased use of variable pay.
A deferred wage increase
is negotiated at the time of initial contract negotiations with the timing and amount specified in the contract.
Working through a temporary-help agency usually means:
low pay in administrative or day labor positions.
Meltrop Corp. employs two store clerks, Sam and Stella. Stella sues Meltrop claiming unequal pay as she earns $500 a week less than Sam does despite doing the same work as Sam. Which of the following is most likely to be the result of the litigation?
Meltrop will lose the litigation as it has committed valuation discrimination.
Under the ________ Act, executives cannot retain bonuses or profits from selling company stock if they mislead the public about the financial health of the company.
Sarbanes-Oxley
According to research, which of the following is true about U.S. expatriates? A) More than 75 percent believe their company values overseas experience. B) More than 50 percent of U.S. expatriates are promoted. C) Only 7 percent of returning expatriates leave their company within one year. D) Only 13 percent of U.S. expatriates are women.
X
Identify Hofstede's national culture dimension that can be described as the extent to which a culture programs its members to feel uncomfortable in unknown and unusual situations and find it difficult to control the uncontrollable. A) Masculinity versus femininity B) Power distance C) Collectivism D) Uncertainty avoidance
X
In ________, employees who are evaluated more highly receive larger or more rapid increments than average or poor performers. A) a two-tier pay plan B) automatic progression C) a union spillover D) merit progression
X
Prevailing-wage laws A) set pay for work done to produce goods and services contracted by the state government. B) specify that a government-defined prevailing wage is the maximum wage that must be paid for work done on covered government projects. C) give contractors the right to drive down wages using their size. D) were passed in response to conditions on projects such as the construction of the Hoover Dam during the Depression.
X
Regarding pay differences for different jobs, A) courts continue to rely on the use of employer opinion surveys to justify differences. B) the courts favor reliance on the use of statistical models. C) court decisions have been inconclusive. D) courts continue to uphold the use of market data to justify differences.
X
The Davis-Bacon Act A) states that income from most stock plans need not be included in calculating overtime pay. B) increases the burden of proof on employers to rebut some discrimination claims. C) requires that mechanics and laborers on public construction projects be paid the prevailing wage in an area. D) extends the prevailing-wage concept to manufacturers or suppliers of goods for government contracts.
X
The Worker Economic Opportunity Act A) states that income from most stock plans need not be included in calculating overtime pay. B) requires the value of all employee stock options to be expensed at estimates of fair value on financial statements. C) gives the Securities and Exchange Commission the authority to grant shareholders proxy access to nominate directors. D) extends the Securities and Exchange Commission pay disclosure requirements to highly paid executives.
X
The ________ prohibits use of several compensation programs, including, but not limited to bonuses, retention awards, and incentive pay, except where part of a preexisting employment contract, during the period Troubled Asset Relief Program funds are received. A) American Recovery and Reinvestment Act B) Lilly Ledbetter Fair Pay Act C) Sarbanes-Oxley Act D) Americans with Disabilities Act
X
The denial of jobs, promotions, or training opportunities to qualified women or minorities are examples of A) access discrimination. B) valuation discrimination. C) treatment discrimination. D) hostile environment.
X
Which of the following is a test that must be met to qualify for the administrative employee exemption? A) The employee must be compensated on a salary or fee basis at a rate not less than $455 per week. B) The employee's primary duty must be performance of manual work. C) The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent. D) The employee must have the authority to hire or fire other employees.
X
Which of the following statements about single rates is true? A) Single rates are usually specified for workers within a particular job classification. B) Single-rate agreements differentiate wages on the basis of seniority. C) Single rates are only specified for workers employed by a firm in different geographic areas. D) Single-rate agreements differentiate wages on the basis of merit.
X
Which of the following statements about anchoring/framing is true?
It states that initial data strongly affect decisions/beliefs
Maxford Corp. offers full vesting after two years. However, it does not offer portability of pension to its employees. Which of the following statements is true in this scenario?
Maxford does not have to provide vested benefits to employees who quit before six months.
NaxWell Corp. sells a smart wristband that, apart from monitoring heart rate and blood pressure, also reminds users to stand and walk every half hour. As part of its promotional efforts, a celebrity starts wearing the wristband, thereby increasing its popularity and ease of sale. Which of the following is most likely to happen?
NaxWell is likely to increase base salaries and decrease incentives.
_____________ relieve an employer's liability when a preemployment injury combines with a work-related injury to produce a disability greater than that caused by the latter alone.
Second-injury funds
A management strategy of giving separate organization units the responsibility to design and administer their own compensation systems is A) known as a centralized strategy. B) known as a decentralized strategy. C) the best approach to design. D) rarely done in today's organizations.
X
At the time they are granted, which of the following have no tax implications for an executive? A) Phantom stock plans B) Incentive stock options C) Stock appreciation rights D) Performance share/unit plans
X
Experts attribute the stabilization in the dollar cost of workers' compensation since 2010 to: A) the increased variable component of base wage. B) the devaluation of the dollar. C) employer safety programs. D) relaxed federal regulations.
X
In the context of the impacts of unions on compensation, which of the following statements is true? A) Unions do not make a difference in wages, across all studies and all time periods. B) Since 2000, the union wage premium has been unstable overall and has risen slightly in the private sector. C) Employees in service or production occupations have the least from union wage advantage. D) Management and professional employees do not enjoy union wage advantage.
X
MerTon, Inc. decides to reduce labor costs by using exit incentives to encourage some of its senior, high-earning members to leave the organization. It replaces the employees who quit with new employees and pays them low wages. Which of the following statements is most likely true in this scenario? A) The number of employees being paid red circle rates will increase. B) The salary range midpoint of the company is less than the compa-ratio. C) The salary range midpoint of the company is higher than the actual salary paid. D) The compa-ratio of the company is greater than 1.
X
Which of the following face the possibility that disgruntled stockholders may sue over corporate strategies that do not ''pan out''? A) Supervisors B) The board of directors C) Professional employees D) Sales staff
X (The board of directors)
A compa-ratio of less than 1 means that, on average, A) employees are senior employees. B) the turnover rate of the organization is low. C) employees are high performers. D) employees in a range are paid below the midpoint.
X (employees in a range are paid below the midpoint.)
A key provision of the ________ allows employees in publicly traded companies the freedom to sell off any employer stock purchased through deferrals or after-tax contributions. A) Consolidated Omnibus Budget Reconciliation Act B) Affordable Care Act C) Pension Protection Act D) Employee Retirement Income Security Act
X - Pension Protection Act
Roughly ________ of all employees have access to paid life insurance. A) three-fourths B) half C) one-third D) a quarter
X - half
Which of the following is true of lump-sum awards? A) They are noncash payments such as certificates and trophies. B) They are given to employees who are added to an employee's base wages. C) They are given to employees every year. D) They are typically given in lieu of merit increases.
X - in lieu of merit increases
In a(n) ________, employees have a hypothetical account into which is deposited what is typically a percentage of annual compensation. A) qualified deferred compensation plan B) employee stock ownership plan C) cash balance plan D) profit-sharing plan
X - profit-sharing plan
Today, ________ percent of workers participate in the pension plan coverage provided by their employers. A) 98 B) 12 C) 28 D) 53
X 53
Contingent workers receive ________ benefits than regular workers; contingent workers' benefits cost ________ for employers than it does for regular workers.
fewer; less
An employee who changes jobs four or more times during his or her career will likely receive a pension that is approximately ________ as that of an employee whose working career is spent with one employer, assuming that both employees have the same starting salary and receive annual increases equal to inflation rate.
half the size
The rising costs of Social Security have been covered by:
increases in the maximum earnings base and the tax rate at which it is taxed.
If red circle rates become common throughout an organization, then:
the design of the ranges and the evaluation of the jobs should be reexamined
Changes in wages in labor markets are measured
through pay surveys
HoldDesk, Inc. has an annual labor cost of $3,000,000. It has a turnover rate of 10 percent and a planned average increase of 5 percent. The turnover effect is
$15,000
The European Union has issued the ________, which is significantly stronger than U.S. regulations A) Minimum Wage Convention B) Non-Retaliation for Disclosure of Compensation Information C) Data Privacy Directive D) Convention on Contingent Workers
X
The Web page for the compensation society is A) Society for Human Resource Management. B) American Compensation Association. C) International Compensation and Benefits Society. D) WorldatWork
X
Which of the following is a benefit under the Employee Retirement Income Security Act guidelines for qualified pension plans? A) Additional life insurance B) Home security C) Payment of club dues D) Executive physicals
X
Which of the following is a factor to control in order to manage labor costs in a simple labor cost model? A) Ethics B) Communication C) Employment D) Behavior
X
Which of the following is a feature of defined contribution plans? A) They are faster to vest than defined benefit plans. B) They are characterized by high contribution rates. C) They are less portable than defined benefit plans. D) They are fully funded by employers.
X
Which of the following issues most commonly reach arbitration? A) Layoffs B) Discharge and disciplinary issues C) Transfers D) Complexity of work assignments
X
Which of the following often go for extended periods in the field with little supervision? A) Sales staff B) Top management C) Supervisors D) Professional employee
X
________________________ a software package, allows workers to make health-care choices, allocate savings to 401(k)s or other savings vehicles, and access vacation schedules. A) Manager self-service B) Employee self-service C) A cafeteria plan D) An enterprise resource planning system
X
Which of the following is a measure of changes in prices of goods and services in the product and service markets over time? A) Producer price survey B) Product market competitor wage survey C) Labor market competitor wage survey D) Consumer price index
X (Consumer Price Index?)
A(n) ________ uses cash or stock award that is determined by an increase in stock price at a fixed future date.
phantom stock plan
If Philadelphia has a CPI of 165 and Houston has a CPI of 145 and if both cities started with bases of 100, it means that
prices have risen faster in Philadelphia since the base year than in Houston
Nonqualified stock options require
purchase of stock at a stipulated price, not conforming with Internal Revenue Code
A major advantage of a ________ is that it reduces benefits costs, something that the other cost-cutting options ordinarily do not achieve.
reduction in force
A compa-ratio reflects the
relationship of the average actual salary in each range to the midpoint of the range
Executives, supervisors, and sales staff often receive special compensation treatment because
these jobs face conflicting demands.
The ________ recognizes the fact that when people leave an organization, they typically are replaced by employees who earn a lower wage.
turnover effect
A study of unions in 114 companies concluded that
unions make a difference in wages across all studies and time periods
