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A group health plan may not use a waiting period that exceeds how many days? A. 30 B. 60 C. 90 D. 120
C. The IRS issued guidance that defined waiting periods for group health plans. It includes the requirement that plans and insurance issuers offering group coverage may not use a waiting period that exceeds 90 days.
Which of the following provisions protect employers who unintentionally violate the exemption status of employees through improper payroll deductions? A. Safe harbor B. Due diligence C. Good faith D. Affirmative defense
A. An employee runs the risk of losing their exemption status if an employer makes an improper deduction from their paycheck. This means the employer would be obligated to pay for all hours worked in the period that the unlawful deductions were made. The FLSA has a safe harbor provision for unintended payroll errors that could affect exemption status.
Which of the following is true of compensatory time off? A. Public employers may compensate employees with comp time instead of overtime payments. B. Both private and public employers may compensate employees with comp time instead of overtime pay. C. Neither private nor public employers may utilize comp time instead of overtime payments. D. All of the above are false.
A. Compensatory time, or comp time, may be used by public employers to compensate employees instead of overtime pay. Instead of being paid time-and-a-half their regular rate of pay for hours worked in excess of 40 in the workweek, they are rewarded with the equivalent of paid time off, calculated at the overtime rate of time-and-a-half.
The employees at your place of business seem to dread benefits open enrollment. You con- ducted a focus group and found that a common complaint was that the employees had to fill out their addresses multiple times on benefits paperwork. Your employer is no more satisfied—the executive team found that lost productivity because of the administrative meetings made the open enrollment period a time of lost revenue. Which of the following solution should you recommend for open enrollment? A. Create employee self-service portals. B. Request that the broker come in to hold meetings. C. Hire a temporary administrative worker to complete redundancies. D. Conduct training for employees on how to complete the paperwork more efficiently.
A. Employee self-service programs have significant advantages when it comes to benefits open enrollment. By consolidating information into one database, redundancies may be eliminated and thus productivity increased.
Confidence or trust and the highest standard of care are the definition of which of the following terms? A. Fiduciary responsibility B. Ethics C. Integrity D. Conflict of interest
A. Fiduciary responsibility is a term that applies to those in a position of responsibility. In an HR context, it applies to professionals who are tasked with advising, managing, and/or administering total rewards programs.
Which of the following is an internal condition that affects an organization's compensation philosophy? A. Willingness to pay B. Market conditions C. What the competition is paying D. All of the above
A. Internal conditions, such as willingness and ability to pay, affect how HR should structure the compensation philosophy. For example, if an organization does not want to lead the market in pay for entry-level workers, either because they can't or because the market is flooded with talent, a compensation philosophy should not reflect competitive rates.
Which of the following represents an HR function that provides the least benefit to an employer and thus may be an argument for outsourcing? A. COBRA administration B. Payroll C. Employee recognition D. Recruiting
A. Of the options listed that may be outsourced, COBRA represents the least valuable HR activity for companies, mainly because it addresses the needs of employees who are no longer employed.
Which of the following is not one of the three factors used to evaluate jobs according to the Hay system? A. Experience required B. Knowledge C. Problem-solving D. Accountability
A. The Hay system is a complicated point factor classification method of job evaluation. It uses three factors: knowledge, problem-solving, and accountability to value jobs within an organization.
Which of the following acts excludes normal commute time as compensable? A. The Portal-to-Portal Act B. The Fair Labor Standards Act C. The Equal Pay Act D. The Davis-Bacon Act
A. The Portal-to-Portal Act amended the FLSA in 1947. It clarified what was considered to be compensable time, and it established that employers were not required to pay for the regular commute time of employees.
Of the following factors, which is the most important for HR to consider when preparing for benefits open enrollment? A. The needs of the employees B. The availability of technology C. The percentage of increase to benefits programs D. The company's compensation philosophy
A. The needs of the employees when preparing for open enrollment season will drive many outcomes. For example, if employees no longer value a particular offering, the employer may be able to reduce costs by no longer offering the benefit. Employees also have differing needs when it comes to the use of technology, many preferring a face-to-face approach over a technological solution. By first understanding what the employee needs and wants, HR may design solutions that can positively impact both the employer and the employee.
Of the following conditions, which is the best reason a company should outsource payroll? A. When payroll is processed by an HR department of one person B. When the company's cash flow is tight C. If the company decides to allow voluntary deductions D. When new payroll regulations are passed
A. There are many reasons a company may choose to outsource payroll processing. There is also much debate about whether payroll is an HR function or an accounting function. Regardless, with an HR department of one person, outsourcing payroll will allow for up to-date expertise and efficient processing of this critical employee need.
Which of the following statements is true about employee benefits programs? A. There are two types of benefits: voluntary and involuntary. B. Health benefits are mandated by state laws. C. Employers are required to have retirement plan options for employees. D. Workers' compensation is a voluntary benefit.
A. Voluntary benefits, such as healthcare and retirement, are often offered by employers to attract and retain qualified individuals. Employers offer mandated benefits such as workers' compensation insurance and Medicare deductions in order to comply with federal or state laws.
If an employer that offers a retirement benefit to their employees fails to provide a summary plan description, they are more than likely violating which of the following laws? A. Employee Retirement Income Security Act B. Consolidated Omnibus Budget Reconciliation Act C. Health Insurance Portability and Accountability Act D. Family Medical Leave Act
A. While retirement benefits are considered voluntary, once employers opt to provide them there are regulations with which they must comply. ERISA requires that employers file three reports: a summary plan description, an annual report, and reports to individual participants of their benefit rights.
"To attract and retain the best qualified workers while ensuring industry-competitive wages and family-friendly benefits" is an example of which of the following? A. A corporate mission statement B. A compensation philosophy C. A company value D. All of the above
B. A compensation philosophy is a specific statement related to compensation and benefits within an organization. It serves to guide the direction of strategic decision-making about one of the highest operating costs within the organization.
Which of the following is used to determine how the organizational financial resources may be best used to attract, retain, and motivate the organization's human resources? A. Change-management strategies B. Compensation strategies C. Compensation philosophy D. Performance-based philosophy
B. A compensation strategy involves the organizational choices that must be made in the application of resources to attract, retain, and motivate employees.
The employer for whom you work has just rolled out a retirement plan in which all qualified employees will receive 1 percent of their average salary for the last five years of employment for every year of service with the employer. This is known as which type of retirement plan? A. Defined contribution B. Defined benefit C. 401(k) D. Simplified Employee Pension
B. A defined benefit plan promises a specified monthly benefit upon retirement. A defined contribution plan specifies a contribution amount, but not necessarily a specified amount upon retirement, as these accounts are subject to contributions minus investment gains or losses.
When an employee is called in to work and there is no work available, which of the following is true? A. There is never an obligation to pay the employee. B. The employer may be required to pay the employee for a minimum number of hours. C. The employer is guilty of an unlawful practice. D. The employer is required to allow the employee to complete the scheduled shift.
B. A reporting premium may be required by state law or an employment agreement. It applies to employees who are called or scheduled to work, report in as required, and find that there is no work available.
If an employee receives a lump-sum payment at the end of a company's fiscal year, they are more than likely receiving which of the following? A. Commission pay B. A bonus C. A pay increase D. A special incentive
B. Bonuses are often discretionary in nature, being provided to employees based on differing variables. These variables may include profit-sharing, spot awards for individual performance, or bonuses based on specific criteria such as employee referrals.
If an employee must complete five years of service to own the employer contributions to their retirement plan, the company has which of the following in place? A. An immediate vesting schedule B. A cliff vesting schedule C. A retention vesting schedule D. A graded vesting schedule
B. Delayed vesting refers to requiring employees to complete a minimum number of years of service before they can claim ownership of the portion of employer contributions in their retirement plans. In cliff vesting, a specified period of time must be completed; in graded vesting, partial ownership of employer contributions occurs in accordance with a vesting schedule.
Direct compensation is to wages as indirect compensation is to what? A. Intrinsic B. Fringe benefits C. Variable pay D. Pay for performance
B. Direct compensation includes payments made to employees that are associated with wages and salaries. They include variable pay and pay for performance. Indirect compensation includes fringe benefits, such as vacation and sick pay.
What would be the main advantage for a small company to use a payroll outsourcing vendor? A. Transfer of risk if a payroll error is made B. Subject-matter expertise in payroll-related regulations C. Cost savings D. All of the above
B. For smaller employers, it can be difficult to keep up with the complex, changing pay- roll and tax-related regulations. For this reason, it is a significant advantage to outsource the payroll function for a small company.
Discouraging employees from talking about their pay rate or annual bonuses is an example of a low degree of .____________. A. Tolerance B. Pay openness C. Privacy D. Procedural justice
B. Pay openness refers to the degree of secrecy around the ability of employees to discuss their wages. It directly affects the perceived fairness of employer compensation plans. Under some conditions, such as state laws and in union environments, it may be unlawful to forbid employees to disclose their pay rates.
If an employer wants to reward perfect attendance, which of the following variable pay programs would be the most effective? A. Doubling the amount of unused days at the end of the year available for the employee to take in the future B. Using attendance as one criterion for determining pay increases C. Handing out perfect attendance certificates at a company event D. Cashing out the unused days as a holiday bonus
B. Performance-based pay must have a direct line of sight between the employee's performance and reward. Doubling the unused days would be counterproductive to the desired outcome, and cashing out an employee's unused pay limits their flexibility in the future. Using a performance management system to track and influence pay increases directly links employee performance to outcomes. It is still important, however, that employers do not unintentionally violate the Americans with Disabilities Act by discriminating against covered employees for absences related to a qualified disability.
The federal hourly minimum wage is currently set at what amount? A. $6.25 B. $7.25 C. $7.50 D. $8.00
B. Some states have established their own minimum wage that is higher than the federal minimum of $7.25. Where federal and state laws have different minimum wage rates, the higher standard applies.
It was brought to the attention of the HR director that the employees out on the production line were not being paid overtime because their supervisor was requiring them to put only 40 hours per week on their timecards, even though they often worked beyond that. Which of the following labor laws was being violated? A. Pay Equity Act B. Fair Labor Standards Act C. Equal Employment Opportunity Act D. Portal to Portal Act
B. The Fair Labor Standards Act (FLSA) requires that all hourly, nonexempt workers be paid overtime for any hours worked over 40 in a week.
According to the Fair Labor Standards Act, how long must payroll records be kept? A. One year B. Three years C. Five years D. Seven years
B. The Fair Labor Standards Act requires that employers keep payroll records for at least three years.
Which of the following key features should be most important for a small-employer HR department to look for when shopping for employee self-service systems? A. The least expensive option for your employer size B. Minimal technical knowledge required to manage once live C. Integration capabilities with existing systems D. Intuitive site designs
B. The long-term management of an employee self-service system is a key consideration. Many HR professionals are not technical experts, and many small employers do not have IT staff on site should issues arise. For that reason, HR should pay particular attention to the troubleshooting process once a system "goes live." Failure to do so could result in lost productivity, frustration, and under-utilization of the features.
As part of the job evaluation process, supervisors are asked to place the jobs in their department in order of importance. Which job evaluation method is being used? A. Rating B. Ranking C. Classification D. Job pricing
B. The ranking method requires evaluators, such as supervisors, to compare the value of jobs to one another. It is a rather subjective method used to evaluate jobs, as evaluators may be influenced by factors unrelated to the work being done.
Which of the following examples is compensable as waiting time under the FLSA? A. An employee waiting to clock in for work B. A receptionist reading a book while waiting for the phone to ring C. An employee on call who cannot be more than 15 minutes away from home D. An employee driving to an alternate work site outside of their normal commute
B. There are several types of compensable time for hourly workers defined under the FLSA. They include waiting time, which is time spent by employees who have been asked to wait for an assignment. On-call pay is compensable if an employer places significant constraints on an employee who may be called in for duty. Travel time pay may be compensable for any time beyond an hourly employee's regular commute.
A member of management who regularly directs the work of others would be classified according to which of the following FLSA exemptions? A. Management B. Executive C. Administrative D. Professional
B. There are several types of exemption statuses identified under the FLSA. The executive exemption applies to employees who have managing the organization or business unit as their primary responsibility, including directing the work of others, and who have the authority to hire and fire.
Organizations that believe employee inputs should be closely tied to their compensation have which type of compensation philosophy? A. Rewards B. Performance-based C. Entitlement D. Equitable
B. There are two basic orientations of compensation philosophies: performance-based and entitlement. Companies that are oriented toward performance-based pay systems believe that compensation should be tied to effort, inputs, and results. Entitlement- oriented companies are more likely to provide cost-of-living or seniority increases, preferring to reward based on factors less related to performance.
Which of the following statements is false regarding the Family Medical Leave Act? A. An employer may require medical certification to verify leave requests. B. An employer is required to use Department of Labor forms for notifying employees of their eligibility, rights, and responsibilities. C. Eligible employees must have worked for an employer who is subject to the FMLA for at least 12 months. D. Workers within a 75-mile radius must be counted in the 50-employee determination.
B. While notifying employees of their eligibility, rights, and responsibilities is mandatory, employers are not required to use DOL forms such as WH-380, WH-381, or WH-382. However, if a substitute form is used, it must include all of the information required by the regulations.
You are the leave specialist for a 100-employee hospital in Chicago. On Tuesday, an employee came to you to let you know that she is three months pregnant. She would like to know what her paid leave options are for when she takes time off. Which of the following would be the first place she may receive wage replacement? A. Social Security benefits B. The Family Medical Leave Act (FMLA) C. Personal sick time D. Paid Family Leave (PFL)
C. A pregnant worker with paid sick time benefits through her employer would receive partial wage replacement first through her employer's benefit.
Wages are to base pay as incentives are to what? A. Bonuses B. Indirect compensation C. Variable pay D. Performance
C. Base pay and variable pay are the two main types of compensation. Incentives, bonuses, and pay for performance are all examples of variable-pay programs.
An employee is offered a job at $52,000 per year. This is a form of which type of compensation? A. Indirect B. Performance-based C. Base pay D. Perks
C. Base pay is the most basic form of direct compensation, often communicated in terms of an hourly rate, an annual salary, or a salary amount stated in the organization's payroll period.
The executive team has decided that all employees should receive a discretionary bonus at the end of the fiscal year, the amount to be determined by years of service. This is an example of which of the following? A. Individual incentive B. Scanlon plan C. Group incentive D. Improshare
C. Discretionary bonuses are often given without the formality or benchmarks of traditional gainsharing programs, such as Improshare or Scanlon. While the amount of the bonus is based on individual attributes (years of service), it applies company-wide and is therefore a group incentive built on shared financial rewards.
What are the two main types of compensation? A. Base pay and incentives B. Static and variable C. Monetary and nonmonetary D. Mandatory and voluntary
C. Elements of total rewards packages fall within two categories: monetary and nonmonetary. Examples of monetary compensation include base pay and retirement contributions. Examples of nonmonetary compensation include nontangible rewards, such as job satisfaction.
Which of the following options is the least effective in communicating changes to employee health benefits plans? A. Face-to-face sessions B. Going to remote work sites to answer questions C. Group meetings D. Asking a broker to come in to explain changes
C. Employees are much less likely to ask questions about their personal needs in a group meeting format. Face-to-face sessions, either with HR or with a broker who understands the plans, is a much more effective way to help employees select a benefits plan that will meet their needs while also giving the employer an opportunity to explain the rationale behind any unpopular changes.
External factors affecting compensation decisions include all but which of the following? A. Economic factors B. Labor market C. The importance of jobs relative to each other D. Supply and demand
C. External factors, such as the economy and the availability of talent in the labor market, affect compensation decisions such as base pay, perks, and benefits.
Plans that reward employees based on cost savings are known as which of the following? A. Improshare B. A Scanlon plan C. Gainsharing D. ESOPs
C. Gainsharing programs are designed to improve labor or production costs. Working with employees and committees, opportunities are identified and implemented with the gains shared among the employees. Gainsharing includes programs such as Improshare, the Scanlon plan, and profit-sharing.
Which of the following is an example of a voluntary deduction? A. Wage garnishment B. Federal income tax C. 401(k) contribution D. Social Security payment
C. HR professionals responsible for payroll must be certain to understand the difference between voluntary and involuntary deductions. In this example, an employee may elect to have a portion of their pay withheld to fund a 401(k) retirement account.
ERISA requires that employers fund the accrued obligations of a retirement plan on which basis? A. Annual B. Bi-annual C. Quarterly D. Monthly
C. In addition to setting standards for those responsible for safeguarding pension funds, ERISA defines funding requirements for pension plans. Once accrued obligations have been determined, employers must make quarterly deposits to a trust fund established expressly for this purpose.
Employees on the second shift are paid $0.50 more per hour. This is known as which of the following? A. Hazard pay B. Bonuses C. Pay differential D. Geographic pay
C. Pay differentials are used as incentives for employees to work in less desirable jobs. Examples include shift pay, on-call pay, and hazard pay.
In many organizations, compensation is the________ operating expense. A. Most important B. Most difficult C. Largest D. Smallest
C. Payroll, compensation, and benefits often make up the largest operating expense for employers. They are also critical factors in determining employee attraction and retention. Therefore, employers should view compensation and benefits as both an expense and a strategy.
Determining the job responsibilities of a position for the purpose of defining exemption status under the FLSA is known as which of the following? A. An exemption test B. Criterion validity C. A duties test D. Job evaluation
C. Positions may be exempt from one or all of the FLSA requirements. For this reason, it is important for employers to conduct a duties test used to determine job responsibilities for the purpose of defining exemption status.
How long is the statute of limitations for filing a claim under the Fair Pay Act with the Equal Employment Opportunity Commission? A. One year from the time the discriminatory act occurred B. One year following employee separation C. Two years from the time the discriminatory paycheck was received D. 180 days from the last pay period
C. President Obama signed the Lilly Ledbetter Fair Pay Act in 2009 to extend the filing time for those who believe they have been the victim of compensation discrimination under the Equal Pay Act. The EEOC states the following: "The deadline for filing a charge or lawsuit under the EPA is two years from the day you received the last discriminatory paycheck (this is extended to three years in the case of willful discrimination)."
The new part-time receptionist you hired has come to you with a question regarding her enrollment in the health insurance plan. She is having difficulty understanding why she is not eligible to enroll in the company health insurance plan until November 1 if her first day of work was September 7. Her sister-in-law (who happens to be in HR at the state) told her that the company must allow her to enroll after 30 calendar days of work. Which of the fol- lowing statements is true? A. The company does not have to comply with the 30-day rule because she is a part-time employee. B. The law allows for a waiting period of 30 business days, not calendar days. C. The law allows for a 90-day waiting period, not 30 days. D. The company is out of compliance with Affordable Care Act regulations.
C. The Affordable Care Act, also known as Obamacare, allows employers to require a 90-calendar-day waiting period for new hires before they may enroll in company health- care plans.
Enterprise coverage under the FLSA applies to businesses employing at least two employees with at least how much in annual sales? A. $150,000 B. $300,000 C. $500,000 D. $1,000,000
C. The FLSA has two categories of coverage: enterprise and individual. Enterprise cover- age applies to organizations with at least two employees and at least $500,000 in annual sales. Individual coverage applies to employers engaged in interstate commerce.
Which of the following labor law amendments requires employers to offer an employee a waiver of their rights to sue under the ADEA? A. Unemployment Compensation Amendment B. Omnibus Budget Reconciliation Act C. Older Workers Benefit Protection Act D. Pension Protection Act
C. The OWBPA amended the Age Discrimination in Employment Act in response to several discriminatory factors of the time. It includes a prohibition of discrimination against older workers, and it defines the conditions under which an employee may waive their right to sue for discrimination.
What was the main focus of the Pension Protection Act of 2006? A. To address excessive executive compensation B. To mandate that employers offer retirement plans C. To require employers to fully fund their pension plans D. All of the above
C. The Pension Protection Act of 2006 (PPA) requires that pension plans offered by employers be fully funded. This is to avoid shortfalls of funding should the company go out of business or as the workers retire and begin to collect their payments.
The SEC requires public companies to disclose compensation fully for the top executives. A. Two B. Three C. Five D. Seven
C. The Securities and Exchange Commission requires clear and concise information related to executive compensation. This includes the disclosure of the amount and type of compensation paid to the top five executives and the criteria used in reaching executive compensation decisions.
What is the primary data used to calculate the monthly retirement benefits from Social Security? A. Current pay rate B. Time spent in the workforce C. Average earnings D. All of the above
C. The amount a retiree will receive upon retirement is dependent upon the individual's average earnings on jobs that are covered by Social Security.
When an employee or spouse has health insurance coverage under multiple plans, the employee's primary insurance company will most likely engage in which practice? A. Coordination of benefits B. Balance billing C. Gatekeeping D. Carve-outs
C. The amount a retiree will receive upon retirement is dependent upon the individual's average earnings on jobs that are covered by Social Security.
Many employers are beginning to recognize the need to offer extended bereavement leave for the loss of an employee's loved one. Of the following options, which benefit would best serve both the employer and the grieving employee? A. Offering unlimited paid time off B. Giving employees at least three days off for bereavement C. Encouraging an employee who needs more time off to get a doctor's note so the employee can be placed on job-protected leave D. Clearly defining the leave policy in the employee handbook
C. Time and financial support seem to be the two primary needs of employees who are dealing with the loss of a loved one; some grief experts recommend at least 20 days of bereavement for the loss of close family members. For this reason, many employers are updating their traditional bereavement practices. Especially for employers operating in states with short-term disability programs that offer wage replacement, reminding the grieving employee of other types of leave benefits can help.
A percentage of a sales employee's compensation is at risk, depending on the individual's ability to sell the company's products or services. This is commonly referred to as which of the following? A. Gainsharing B. Profit sharing C. Commissions D. Base pay
C. Variable pay is also known as earnings at risk. It implies that a portion of the pay must be earned by meeting specific criteria. Commissions provide incentives to sales employees by paying them a percentage of the sales price for products and services sold to the customer.
When new employees are hired at a higher rate of pay than that of the incumbent, what is said to have occurred? A. Inequitable treatment B. An unlawful act C. Wage compression D. Red circling
C. When a new hire makes more than the incumbent, wage compression has occurred. It may be the result of high demand for a certain skillset, or it may occur when an organization's pay practices, such as merit or cost-of-living increases, fail to keep pace with labor market conditions.
Which of the following data sources would be the most effective if HR needed to gather market-based competitive pay rates? A. State unemployment offices B. The Department of Labor C. Industry surveys D. Websites such as salary.com
C. While all of these are sources for wage data, the best option would be industry surveys. Available for purchase, these surveys provide a more detailed view of the nature of the competitive pay structures. These surveys may include the employer size, types of benefits, and the nature of commission and bonus structures.
Which of the following is false about the Health Insurance Portability and Accountability Act? A. HIPAA prohibits discrimination in insurance for individuals with a disability. B. HIPPAA places limits on health insurance restrictions for preexisting conditions. C. HIPAA allows employers to require plan participants to pass a physical examination prior to enrolling. D. Flexible spending accounts have a partial exemption from the requirements of HIPAA.
C. While group health plans can require an employee to take a physical at the time of enrollment, it is specifically prohibited from using information gathered in that exam to restrict enrollment or charge more to otherwise eligible employees.
Short breaks lasting less than how many minutes are considered compensable time under the FLSA? A. 5 B. 10 C. 20 D. 35
C. While the FLSA does not specifically require meal/rest periods, if they are provided, they are subject to a determination of compensability. Rest periods of less than 20 minutes must be paid to (nonexempt) hourly workers.
What is the primary purpose of a health insurance purchasing cooperative? A. To reduce the overall costs of healthcare B. To help small businesses comply with the Affordable Care Act C. To provide self-funded companies with stop-loss coverage D. To provide smaller organizations with the bargaining power of larger organizations when purchasing health plans
D. A Health Insurance Purchasing Cooperative is a type of employer alliance. Businesses band together in a single bargaining unit that may then leverage its size to get more affordable rates than the individual businesses would by negotiating independently.
Which of the following individuals would be said to have fiduciary responsibility over an employer's group health plan? A. The company board of directors B. The human resource manager C. The plan administrator D. All of the above
D. Any individual or individuals with discretionary decision-making authority about an employer's group health plan are expected to make decisions that are in the plan's participants' and beneficiaries' interest only. These responsibilities are defined not only by title but for any individual or group of individuals with the ability to exercise discretionary authority.
There are two basic types of employee benefit programs. What are they? A. Direct, indirect B. Intrinsic, extrinsic C. Tangible, intangible D. Legally mandated, voluntary
D. Benefits fall within two classifications: those that are required by law and those that employers choose to offer. Total rewards include both direct and indirect compensation options along with the identification of intrinsic and extrinsic rewards.
Which of the following acts did the Consolidated Omnibus Budget Reconciliation Act (COBRA) amend? A. Fair Labor Standards Act B. Family Medical Leave Act C. Americans with Disabilities Act D. Employee Retirement Income Security Act (ERISA)
D. COBRA amended ERISA in 1996 by requiring businesses with 20 or more employees to provide health plan continuation coverage under certain circumstances. ERISA is the federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.
Which of the following are examples of compensable factors that are defined during the job evaluation process? A. Education B. Skills C. Experience D. All of the above
D. Compensable factors are those characteristics of jobs that have value. The job evaluation process attempts to identify these factors and then assign a value aligned with the compensation strategy and task importance.
An employee at your organization emailed a benefits spreadsheet to his spouse so she could help him format the data. Which of the following risks did this action cause? A. Privacy breach B. Negligence C. Identity theft D. All of the above
D. Cyberattacks against company health and retirement plans are on the increase—both for employers that collect and store the data as well as any third-party vendors that may have access. Risks in this example include a breach of privacy laws related to medical information, negligence should the data be compromised, and identity theft should sensitive information such as Social Security numbers fall into the wrong hands.
Maritime Services Inc. is a growing employer with 42 full-time employees and 5 part-time workers. One of the workers has just called in to his manager, informing her that he broke his leg and will need to take off the next two weeks for surgery and recovery. Which of the following labor laws applies? A. FMLA B. ADA C. Workers' compensation D. None of the above
D. Employees needing time off for routine or short-term conditions do not generally have protection under the ADA. The FMLA applies to employers with 50 or more employees, and workers' compensation covers employees who have a work-related injury. Any slight tweak could alter their eligibility, however. For example, the FMLA could apply in this situation if the employer had 50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding year, and the ADA may come into effect if the injury becomes debilitating.
Which of the following pairs best represents the primary purpose of employer pay practices? A. Fair and balanced B. Lawful and generous C. Needs-based and legal D. Competitive and equitable
D. Employer pay systems and practices must be internally and externally competitive and equitable. In this way, their practices are more likely to be based on needs (employee and market) and compliant with federal, state, and local regulations.
Which of the following strategies may help engage employees in the benefits open enrollment process? A. Communicating information early and often B. Holding raffle drawings every day for employees who have turned in their paperwork C. Following up with employees who have not signed up to encourage them to do so D. All of the above
D. Engaging employees throughout the open enrollment process can be done in several ways. By putting relevant information out early in the process, HR can help avoid the "information saturation" that so often occurs with administrative-heavy practices. Offering incentives and following up with those who have not yet participated can also help HR meet timelines.
Which of the following statements regarding the FMLA are true? (Choose all that apply.) A. The FMLA applies to all public schools and agencies, regardless of their size. B. The FMLA applies to private employers with 50 or more employees. C. Eligible employees must have worked a minimum of 1,000 hours in the previous 12 months. D. Both A and B.
D. FMLA applies to all public agencies and schools, as well as employers with 50 or more employees working within a 75-mile radius.
Determining the relative worth of jobs within an organization is also known as which of the following? A. Wage surveys B. Comparisons C. Internal equity D. Job evaluation
D. Job evaluation is an attempt to remove subjectivity from the process of determining the value of jobs. It identifies objective criteria and measures them against the level of importance to both the job and the organization.
What do Social Security, workers' compensation, and unemployment insurance have in common? A. They all have wage replacement benefits for qualifying employees. B. Employers must offer all three to employees. C. Taxes to support these programs are paid by both the employer and the employee. D. Both A and B.
D. Mandated employee benefits, or those required by law, often have some level of wage replacement calculation for qualifying employee events such as disability, injury, retirement, or unemployment.
As the new HR manager, you have conducted a benefits survey/needs assessment. The findings showed that employee utilization is high, but the costs have grown an average of 18 percent over the past three years alone. What should you recommend to management? A. Eliminate the most expensive benefit. B. Begin to research new brokers. C. Increase cost sharing for premiums and deductions. D. Explore all strategies to contain the cost.
D. Most employers are having to explore cost containment strategies as the price of employee benefits continues to skyrocket. In this needs assessment, the employees are worried about the cost. To address their concerns while balancing the value of these programs to the employer, you should explore all cost containment options before making a recommendation.
An employee promotion is classified as which type of compensation? A. Variable pay B. Incentives C. Bonus D. Performance-based
D. Performance-based compensation includes programs designed to reward the efforts of employees.
An employee in your company has complained that the compensation data used to establish his pay rate is out of date. This is an example of which of the following? A. Distributive justice B. Pay openness C. External market conditions D. Procedural justice
D. Procedural justice is a pay equity concept in which employees perceive the procedures used to determine pay rates as either fair or unfair. It may also include how bonuses are distributed and the method used to determine pay increases..
Your company regularly engages in a pay increase process that relies on external survey data to calculate raises. It is employing which of the following types of increase? A. Merit increases B. Annual reviews C. Performance-based increases D. Cost-of-living increases
D. Survey data is often necessary to determine cost-of-living adjustments (COLA) to pay. It relies on factors such as inflation to determine how much pay must grow in order for employees to maintain their current lifestyle.
To which of the following business types does the FLSA not apply? A. Railway workers B. Airline captains C. Private employers doing business with the government D. Both A and B
D. The FLSA regulations apply to workers who are not already covered by another law. These include railroad and airline employers, who are subject to wage regulations identified under the Railway Labor Act.
In the exemption requirement of the FLSA, what is the employee most likely exempt from? A. Age requirements B. Record-keeping requirements C. Minimum wage D. Payment of overtime
D. The FLSA requires that employers define the pay status of all positions within the organization. Based on the job responsibilities, a position may be exempt from the payment of overtime for working more than 40 hours in a week.
Which of the following acts established the federal minimum wage? A. Portal to Portal Act B. Rehabilitation Act C. Equal Pay Act D. Fair Labor Standards Act
D. The Fair Labor Standards Act (FLSA) affected three distinct areas related to compensation: establishing a federal minimum wage, restricting child labor, and limiting working hours through overtime pay and exemption status.
Employers are obligated to provide 12 weeks of unpaid leave for eligible employees in covered organizations for the purposes of caring for a serious illness of themselves or a family member under which of the following labor laws? A. Portal to Portal Act B. Americans with Disabilities Act C. Fair Labor Standards Act D. Family Medical Leave Act
D. The Family Medical Leave Act (FMLA) was passed to provide job protection for eligible employees who are faced with a serious illness in themselves or a family member. It allows covered employees to take 12 weeks of unpaid leave within a 12-month period, in most cases obligating the employer to reinstate the employee to the same or similar position upon return.
If outsourced, what types of COBRA administration activities should HR be sure the vendor will manage? A. Eligibility tracking B. COBRA notices C. Monitoring coverage periods D. All of the above
D. There are many elements HR must consider when generating a request for proposal for COBRA outsourcing services. Eligibility tracking, COBRA notices, and monitoring coverage periods are just a few compliance pieces that HR must ensure are being managed, either in-house or with a service.
An employee hired as a research scientist may be classified according to which of the following FLSA exemptions? A. Management B. Executive C. Administrative D. Professional
D. There are several types of exemption statuses identified under the FLSA. The professional exemption applies to employees who have advanced knowledge in a field of science or learning acquired through education. This exemption also applies to creative professionals whose primary responsibilities include invention, imagination, originality, or talent.
Which of the following must be counted in the 90-day waiting period calculation under the Affordable Care Act? A. Weekends B. Holidays C. Calendar days D. All of the above
D. Under the Affordable Care Act, employers cannot require employees to wait more than 90 days to be eligible for company health benefits. The 90-day period includes weekends and holidays (calendar days).
Ben begins working 25 hours per week for Company Z on January 3 and is considered part-time for purposes of the company's group health insurance. Company Z sponsors a group health plan that provides coverage to employees after they have completed a cumu- lative 1,200 hours of service. What is the approximate latest date Ben may be eligible for company health insurance under the plan? A. February 15 B. April 1 C. August 1 D. December 15
D. Under the IRS's guidance, eligibility conditions will not be considered to be designed to avoid the 90-day waiting period obligation provided that coverage is made effective no later than 13 months from the employee's start date.
Which of the following is considered a source to use to complete a salary survey? A. Employee surveys B. Government surveys C. Outsourced vendors D. All of the above
D. Using multiple sources to glean information about compensation and benefits ensures that representative data is collected from the relevant market. Government surveys, employee needs surveys, and commissioned surveys are all examples of source information.
Employers may charge COBRA participants what maximum of the group premium for continuation of coverage? A. 25 percent B. 52 percent C. 75 percent D. 102 percent
D. While it is mandatory for employers to offer COBRA continuation of health care to eligible ex-employees who have experienced a qualifying event, they are not obligated to continue to pay the insurance premium on the employee's behalf. Therefore, employers may charge up to 102 percent of the group's premium to the employee.
