Week 1

Which of the following is the correct order of the steps in formulating a total compensation strategy?

Assess, map, implement, and reassess the strategy.

________ is the key to attracting, retaining, and motivating employees with the abilities necessary to execute the business strategy and handle greater decision-making responsibilities.

Compensation

________ refers to a wide range of factors, including legal and regulatory requirements, cultural differences, changing workforce demographics, expectations, and the like.

Context

________ is defined as employee belief that returns and/or rewards are due regardless of individual or company performance.

Entitlement

Which of the following is a fundamental objective, and NOT a policy, of the pay model?

Fairness

Which of the following is given as an increment to base pay in recognition of past work behavior?

Merit pay

In the context of pay relationships, which of the following is illegal in the United States?

Paying on the basis of one's age

________ is the measure of how important total compensation is in the overall HR strategy.

Prominence

Which of the following is often the largest component in an executive pay package?

Stock options

________ refers to openness and communication about pay.

Transparency

Which of the following programs introduced by Congress includes restrictions on executive pay that are designed to discourage executives from taking "unnecessary and excessive risks"?

Troubled Asset Relief Program

Union preferences are a major factor in ________ a total compensation strategy.

assessing

A measure of how changes in one variable are related to changes in another variable is the:

correlation coefficient

A compensation system focusing on operational excellence is most closely associated with a(n) ________ strategy.

cost-cutter

Mich Inc., a hardware store, has a rating system in place that rates employees on their friendliness, usefulness, and product knowledge. Based on the ratings an employee receives, he or she gets an incentive. The compensation strategy followed by Mich is most closely described as a(n):

customer-focused strategy.

A difference between incentives and merit increases is that incentives:

do not increase the base wage, whereas merit increases increase the base wage.

The decisions to implement pay for performance, flat rate pay, and profit sharing are examples of ________ policy decisions.

employee contribution

Compensation policy choices that affect the pay level relative to other companies are most closely associated with the ________ aspect of the pay model.

external competitiveness

Work/life balance is most closely associated with the ________ aspect of mapping a total compensation strategy.

external competitiveness

Research investigating high-performance workplaces found that performance-based pay ________ when combined with other high-performance practices.

improves attitudes and behaviors

The degree to which pay influences individual and aggregate motivation among employees at any point in time is referred to as a(n):

incentive effect.

Robert, the CEO of GameTrack Corp., wants to restructure its pay plan without increasing labor costs in the long run. He is most likely to achieve this, while retaining his top employees, by:

increasing incentive pay and decreasing base pay

Career growth, hierarchy, and flexible design are most closely associated with the ________ aspect of mapping a total compensation strategy.

internal alignment

In mapping a total compensation strategy, the question of how important compensation is in the overall HR strategy is part of

objectives

Unlike merit increases, merit bonuses are:

paid in the form of a lump sum.