MGMT 2115 Chapter 9 Concept Check

pay secrecy

Anna, an employee at a manufacturing company, contacted the HR manager of her company to inquire about the compensation received by her colleague for working overtime. The HR manager, however, refused to disclose the details to Anna stating that it was confidential. The given scenario illustrates _____. a. pay equity b. pay inversion c. pay compression d. pay secrecy

a wellness program

As part of a new benefit program, a law firm conducts physical exercise sessions for its employees twice a week to keep them healthy. The aim of this program is to keep employees from getting sick and help them stay fit and active. The given scenario illustrates _____. a. the Medicare program b. the Social Security program c. an employee assistance plan d. a wellness program

internal equity

Bianca is a product engineer at Argon Inc. She learns that the salary she receives is less than that received by the other product engineers in the company with similar qualifications and job experience as hers. As a result, she becomes unhappy with her compensation and feels demotivated. She later talks to her manager and asks for a raise. In this scenario, Bianca has experienced problems with _____. a. external equity b. pay compression c. job evaluation d. internal equity

income under the Social Security system

Hamid, a 68-year-old man, recently retired from a corporate company as a language trainer. He now tutors school children to cover his monthly expenses. Additionally, Hamid also receives some income from the government. This income is based on his average monthly salary that he used to earn, weighted toward the latter years of his career. In the given scenario, Hamid most likely receives: a. income under the Medicaid program. b. workers' compensation. c. income under the Social Security system. d. unemployment insurance.

pay survey

Human resource managers are most likely to obtain much of the information concerning external equity from a _____. a. defined benefit plan b. wellness program c. maturity curve d. pay survey

Internal equity

In the context of compensation, which of the following terms refers to comparisons made by employees to other employees within the same organization? a. Job evaluation b. Collective bargaining c. Peer appraisal d. Internal equity

External equity

In the context of compensation, which of the following terms refers to comparisons made by employees to others employed by different organizations performing similar jobs? a. Collective bargaining b. External equity c. Peer appraisal d. Pay inversion

Workers' compensation

In the context of mandated protection programs, which of the following covers individuals who suffer a job-related illness or accident? a. Unemployment insurance b. A wellness program c. A defined contribution plan d. Workers' compensation

A cafeteria-style benefits plan

In the context of nonmandated benefits, which of the following allows employees to choose the benefits they really want? a. A defined benefit plan b. A cafeteria-style benefits plan c. An employment assistance plan d. A life-cycle benefits plan

A wellness program

In the context of nonmandated benefits, which of the following concentrates on keeping employees from becoming sick rather than simply paying expenses when they do become sick? a. A life-cycle benefits program b. A defined contribution plan c. A wellness program d. An employee assistance plan

pay inversion

Laura is a layout artist at an advertising agency and has been part of the organization for 5 years. However, she earns less than Andrea, a digital artist who has been in the organization for only 3 years. This is because digital advertising is the latest trend in the advertising industry, and hence, there is a huge demand for digital designers in the market. The given scenario is an example of _____. a. pay equity b. pay inversion c. pay compression d. pay secrecy

a defined benefit plan

Leonard, an executive employee at a bank, contributes a part of his salary to a retirement account in his name every month. Even his employer contributes some amount to this account on a monthly basis. The collective aim of Leonard and his employer is to amass a predetermined amount by the time Leonard retires so that he can receive those benefits after retirement. This amount is based on Leonard's salary and his years of service at the bank. In the given scenario, Leonard and his employer are contributing to _____. a. a defined contribution plan b. a defined benefit plan c. workers' compensation d. the Social Security program

base salary and some form of incentive pay.

Most senior executives receive their compensation in two forms. They are: a. wages and some form of perquisites. b. base salary and some form of incentive pay. c. a hardship premium and some form of incentive pay. d. a remittance and life-cycle benefits.

an employee assistance plan

Oliver, a stockbroker at an investment firm, is addicted to alcohol. This addiction has severely affected his performance at work. He speaks with his HR manager about the addiction and signs up for a voluntary program at his office that helps employees deal with chronic alcohol addiction. In the given scenario, Oliver has most likely signed up for _____. a. a defined benefit plan b. a wellness program c. an employee assistance plan d. the Social Security program

is not much more than that of an entry-level employee.

Pay compression is likely to occur in an organization if an experienced employee's salary: a. is more than the base salary of top executives in the organization. b. is less than that of new employees. c. is more than that of other employees with the same job profile and qualifications. d. is not much more than that of an entry-level employee.

Unemployment insurance

Ralph, a sales representative in a car showroom, was fired from his job because he could not meet the monthly sales targets over the past 6 months. He is currently looking for another job. Which of the following mandated benefits can Ralph avail until he finds another job? a. A private pension b. Social Security c. Unemployment insurance d. Workers' compensation

Workers' compensation

Reuben, an electrician who works at Fresnas Builders, got severely injured when the transformer he was repairing at a construction site short-circuited. Reuben suffered many injuries, and the doctor advised him to rest for at least 2 months. During these 2 months, Reuben's medical expenses were covered by his employer. In the given scenario, Reuben is most likely insured under _____. a. a defined benefit plan b. unemployment insurance c. workers' compensation d. a cafeteria-style benefits plan

external equity

Shireen, a chartered accountant at an investment firm, is dissatisfied with the compensation she receives from her firm. She speaks to her friend Davis, who has the same job profile in a rival firm. She learns that his salary is substantially higher than hers. In the given scenario, Shireen is most likely to be concerned about _____. a. external equity b. pay inversion c. her stock-option plans d. her vesting rights

Old Age Survivors and Disability Insurance Program

Social Security is officially known as the _____. a. Temporary Assistance for Needy Families Program b. Supplemental Nutrition Assistance Program c. Old Age Survivors and Disability Insurance Program d. Children's Health Insurance Program

protect employees who had contributed to their pensions but were unable to collect those benefits later.

The Employee Retirement Income Security Act (ERISA) was passed to: a. prevent organizations from establishing private pension plans and employee assistance plans for their employees. b. prevent employees from carrying a portion of their benefits to another job. c. protect employees who had contributed to their pensions but were unable to collect those benefits later. d. make vesting rights operational after 10 years of service at the most.

compensation

The set of rewards that organizations provide to individuals in return for their willingness to perform various jobs and tasks within the organization is known as _____. a. a remittance b. a bursary c. compensation d. attrition

benefits

The various rewards, incentives, and other things of value that an organization provides to its employees beyond their wages, salaries, and other forms of direct financial compensation are known as _____. a. bursaries b. grants c. remittances d. benefits

Salaries

Which of the following describes compensation on a monthly or annual basis and compensates employees not for how much time they spend in the organization but for their overall contributions to the organization's performance? a. Salaries b. Wages c. Bursaries d. Remittances

Wages generally refer to hourly compensation, whereas salaries refer to monthly or annual compensation.

Which of the following is a difference between wages and salaries? a. Wages are paid to permanent employees, whereas salaries are paid to temporary employees. b. Performance is the basis for wages, whereas time is the basis for salaries. c. Waged employees are exempt from the overtime provisions of the Fair Labor Standards Act, whereas salaried employees are eligible for them. d. Wages generally refer to hourly compensation, whereas salaries refer to monthly or annual compensation.

Job evaluation

Which of the following is a method for determining the relative value or worth of a job to an organization so that individuals who perform that job can be compensated adequately and appropriately? a. Job enlargement b. Job rotation c. Job evaluation d. Job enrichment

The employee most likely to select a benefit is also most likely to use the benefit, which tends to drive up benefit costs.

Which of the following is a problem with cafeteria-style benefits plans? a. Employees can choose only up to two benefits from a list of benefits provided by their organization. b. The total cost of the benefits availed by an employee is deducted from the base salary of that employee. c. They minimize the effectiveness of benefits programs and lead to increased employee turnover. d. The employee most likely to select a benefit is also most likely to use the benefit, which tends to drive up benefit costs.

It provides a rigorous assessment of the true value of various jobs.

Which of the following is an advantage of the factor-comparison method for job evaluation? a. It is the most objective method of job evaluation. b. It provides a rigorous assessment of the true value of various jobs. c. It is extremely simple and easy to use. d. It is inexpensive for an organization.

The classification system

Which of the following job-evaluation techniques attempts to group sets of jobs together into clusters, which are often called grades? a. The point system b. The factor-comparison method c. The classification system d. The market-basket analysis method

Pay inversion

Which of the following refers to a situation where new employees in an organization are actually paid more than experienced employees in the organization because of rapid changes in the external market? a. Pay compression b. External inequity c. Wage elasticity d. Pay inversion

Wages

Which of the following refers to hourly compensation paid to operating employees? a. Wages b. Remittances c. Salaries d. Pensions

Pay secrecy

Which of the following refers to the extent to which information on the compensation of any individual in an organization is formally made available to other individuals? a. Pay compression b. Pay equity c. Pay inversion d. Pay secrecy

Skill-based pay

Which of the following rewards employees for acquiring new expertise? a. Productivity-based pay b. Seniority-based pay c. Skill-based pay d. Job-based pay

A maturity curve

Which of the following specifies the amount of annual increase in compensation that an employee will receive from the organization? a. A summit curve b. A survivorship curve c. A maturity curve d. A compound curve

They are likely to foster a culture of elitism and competitive superiority

Which of the following statements is true of above-market pay policies? a. They tend to increase voluntary turnover among employees. b. Organizations that are in areas with high unemployment are most likely to use these policies. c. They are likely to foster a culture of elitism and competitive superiority. d. A benefit of these policies is low labor costs for an organization.

Most experts argue that money spent on benefits programs affects job satisfaction and subsequent turnover

Which of the following statements is true of benefits programs? a. Employee expectations have little role in determining what benefits a firm must offer. b. A good amount of data exists to support the fact that benefits programs are not instrumental in attracting better applicants. c. Most experts argue that money spent on benefits programs affects job satisfaction and subsequent turnover. d. The need to remain competitive with other firms in an industry is a major force in reducing the cost of benefits programs.

They are closely monitored under the Employee Retirement Income Security Act of 1974.

Which of the following statements is true of defined benefit plans? a. They are funded by the government and employers. b. The benefits provided by these plans are mandated by the Social Security Act of 1935. c. The size of the benefit in these plans depends on how much money is contributed to the plan. d. They are closely monitored under the Employee Retirement Income Security Act of 1974.

They can include donations from both the employer and the employee

Which of the following statements is true of defined contribution plans? a. The size of the benefit in these plans is determined by an individual's years of service in an organization. b. They are pension plans started by the government under the Social Security Act of 1935. c. These plans are often favored by unions and are closely monitored under the Employee Retirement Income Security Act of 1974. d. They can include donations from both the employer and the employee

The traditional method of incentive pay for executives is in the form of bonuses.

Which of the following statements is true of executive compensation? a. Most senior executives receive their compensation solely in the form of incentives. b. The traditional method of incentive pay for executives is in the form of bonuses. c. Most employment laws make it mandatory for firms to pay a six-figure salary to their top executives. d. The appraisal of top executives is done using the same methods that are used for other employees.

Businesses may elect to provide these benefits in order to attract more qualified workers.

Which of the following statements is true of nonmandated benefits? a. They are funded by the government. b. No laws or regulations are applicable on these benefits. c. These benefits include unemployment insurance and workers' compensation. d. Businesses may elect to provide these benefits in order to attract more qualified workers.

It makes vesting rights operational after 6 years of service at the most

Which of the following statements is true of the Employee Retirement Income Security Act (ERISA) of 1974? a. It prevents organizations from establishing private pension plans. b. It prevents employees from carrying a portion of their benefits to another job. c. It makes vesting rights operational after 6 years of service at the most. d. It specifies which employees are covered by overtime provisions and which are exempt.

After job grades have been determined, the job evaluator writes descriptions of each job class.

Which of the following statements is true of the classification system for job evaluation? a. It cannot accommodate changes in the value of various individual jobs in a firm. b. After job grades have been determined, the job evaluator writes descriptions of each job class. c. After classifying the jobs in a firm, each set of jobs is ranked according to the skills required to perform them. d. It is extremely complex, difficult to use, and time-consuming.

It typically evaluates 8-10 compensable factors for each job.

Which of the following statements is true of the point system for job evaluation? a. It requires managers to describe the value of the various elements of specific jobs in subjective terms. b. It is less sophisticated than the classification system for job evaluation. c. It typically evaluates 8-10 compensable factors for each job. d. It evaluates or compares jobs using a factor-comparison scale as a benchmark.

It is funded by premiums paid by employers.

Which of the following statements is true of unemployment insurance? a. It is funded by premiums paid by employers. b. To be eligible for it, an individual must have worked for at least 2 years. c. It was created in the United States as part of the Fair Labor Standards Act. d. To be eligible for it, a person should have a part-time job.

Vesting rights

Which of the following terms refers to guaranteed rights to receive pension benefits? a. Suffrage rights b. Natural rights c. Miranda rights d. Vesting rights

To lower the number of uninsured employees

Which of the following was one of the basic aims of the Affordable Care Act? a. To lower the number of uninsured employees b. To compensate employees who suffer from a job-related illness c. To provide a basic subsistence payment to employees who are between jobs d. To provide social insurance coverage for retired workers