Comp. Admin. Final Exam Prep

8 steps in design of Point Plan

1. Conduct job analysis 2. Determine compensable factors 3. Scale the factors 4. Weight factors according to importance 5. Select criterion pay structure 6. Communicate the plan and train users 7. Apply to nonbenchmark jobs 8. Develop online software support

One of the main issues with SS is a rising number of retirees without

A corresponding increase in the number of contributors

Ensures employees on overseas assignments have same spending power as they would in their home country

Balance sheet approach

All of the following are categories of rater training EXCEPT _

Behavior modeling

Which is NOT one of the three basic building blocks of The Pay Model?

Commission & incentives that make up the compensation system -Compensation obj. -Policies of the comp. syst. -Techniques that make up the comp. syst.

The motivation triangle includes

Culture

Which is an advantage of providing stock ownership options as variable pay to employees?

Defers a portion of taxes to employees

Which is NOT a type of internal pay structure?

Differentiating structure -Hierarchical structure -Egalitarian -Layered

Which is NOT one of the 5 dimensions of comp. strategy?

Dynamic culture -Obj. & Management -Internal alignment & external competitive -Employee Contribution

Gives employees part ownership in the company

ESOPs

_ is the most frequently used medium for communicating employee benefits

Employee benefit handbook

Which is NOT one of the assumptions theories of labor mkts usually begin with?

Employers encourage employees to increase production

Unemployment insurance is financed exclusively by

Employers that pay federal and state unemployment

The executive branch of the federal govt

Enforces laws through agencies and it's other bodies

One of the main challenges of designing an internal pay structure is creating structures to:

Engage people to help achieve organization obj.

A 401K is an example of a defined benefit plan

FALSE

Rankings are more popular among managers than ratings as they are less compec

FALSE

The Employment Retirement Income Security Act requires employers to offer some form of pension

FALSE

Adjustments to forms of pay occur more often than adj. to overall pay level

False

And individual employee cannot earn more pay than the max of the pay grade of their current job

False

Approximately 20 percent of expats leave their country within a year of their return to US

False

Govt affects the supply of labor through legislation, but it has no effect on labor demand

False

The gender pay gap is not common across countries and is larger in some countries than US

False

Which of the following types of workers are generally NOT covered by workers comp

Farm workers

Feature of defined contribution plans

Faster to vest than defined benefit plans

NOT a likely consequence of a highly decentralized pay system?

Financial malfeasance is completely eliminated

Type of comp plan based on the idea that only the ee knows what rewards would suit their needs

Flexible comp

Which of the following statements is true of individual spot awards?

Given to ee's for great performance as an add-on bonus

Which of the following is NOT one of the explanations for the decline of union memberships

Growing industries are most heavily unionized

Act destined to lessen an employers ability to deny coverage for a preexisting condition

HIPPA

In Hofstede's cultural dimensions, in Malaysia & Mexico, what pay structures are appropriate

Hierarchal

Which of the following is a negative outcome of the management by objectives method?

Increase in performance pressure and stress

The major potential advantage of outsourcing is

Increased cost savings

Reason for unions favoring gain-sharing plans

Increased involvement with job activities

The rising cost of Social Security have been covered by

Increases in the max earnings base and the rate it is taxed

Actions most likely to be favored by unions

Introducing lump-sum awards

What are the three tests that determine whether a pay strategy is a source of advantage?

Is it aligned? Does it differentiate? Does it add value?

Why bother with a pay structure?

It supports improved org. performance

What is the process for determining relative value in regard to job-based structures called?

Job evaluation

What is an ordering of jobs based on their content or relative value?

Job structure

External competitiveness is shaped by what factors?

Labor mkt, product mkt, org. factors

Competencies are derived from what?

Leaderships beliefs about the org. & it's strategic intent

The typical employee can recall _ percent of the benefits he or she receives

Less than 15

Employers can be liable for pay diff. Resulting from discrimination that occurred years earlier

Lilly Ledbetter Fair Pay Act

Approach to motivating executives to make decisions that are in the best interests of stockholders

Long-term incentive plan using stock options

Working through a temporary-help agency usually means

Low pay on admin or day labor positions

_ are one-time cash payments to employees that are not added to an ee's base wages

Lump-sum

Benefit under Social Security

Lump-sum death payments

What is the additional output associated with the employment of 1 additional person called?

Marginal product of labor

The _____ specifies the number of breaks that must be provided in an eight-hour workday.

Occupational Safety and Health Administration legislation

Which of the following is NOT a benefit that is required by statutory law?

Pension and retirement benefits

Motivation, ability, and work design determines employees behaviors such as:

Performance

What two sources of fairness are important in regard to comp. paid to employees

Procedural & distributive justice

All of the following are cost-containment practices designed to reduce benefit costs EXCEPT

Provision of skills development training

In creating the total comp. strategy, this step involves realigning as conditions change

Reassessing the strategy

A major advantage of a _ is that it reduces benefits costs

Reduction in force

Defining the _ is a big part of figuring out how much to pay

Relevant markets

Which of the following statements about merit pay is NOT true?

Removal of merit pay lowers satisfaction but not performance.

NOT a provision of the Fair Labor Standards Act?

Requires employers give 15 weeks of med. leave to ee's -sets min wage standards -prohibits child labor -requires overtime for working greater than 40

From whose perspective does your textbook discuss the importance of regarding compensation?

Society, stockholders, managers, employees

Different types of pay strategies may cause diff. types of people to stay with a company:

Sorting effect

Surveys show the most popular type of variable pay plans are _____.

Special recognition plans

The first step in setting competitive pay and designing a pay structure is to _

Specify a pay-level policy

Most organizations tie money to promotions to induce employees to apply for higher positions

TRUE

Which of the following is NOT a strength of supervisors as ratters?

Their ratings are immune to halo and leniency errors

Which of the following is true regarding broad bands

They foster cross-functional growth

A compa-ratio is the average actual pay divided by the midpoint of the pay grade

True

Disparate impact focuses on discriminatory consequences rather than the intent to discriminate

True

Employers who have frequent layoffs pay higher tax rates than those with few layoffs.

True

Identifying pay survey participants by org. name is called price fixing under the Sherman Act

True

In Germany, an employee's pay is affected by his or her age

True

Japanese pay systems are more person-based than job-based

True

The key to a comparable-worth system is a single job eval plan for jobs with dissimilar content

True

Voluntary benefits account for nearly 37% of the total comp package for unionized workers

True

When federal and state min. Wage laws are diff. Workers need to be paid the higher wage

True

contingent workers are usually considered candidates for special comp

True

Denial of jobs, promotions, or training opportunities to qualified women or minorities are examples of _____.

access discrimination

_____ is the best appraisal format across the five criteria for evaluating rating formats. A. Ranking B. MBO C. BARS D. Standard rating scales

bars

_____ has produced more comparable-worth pay increases than any other approach.

collective bargaining

Regarding pay differences for different jobs, _____.

courts continue to uphold the use of market data to justify differences

All of the following are advantages of flexible benefits EXCEPT

decreased administrative expenses

The trend in recent variable-pay design is to combine the best of _____ and _____ plans.

gain-sharing; profit-sharing

The base salary plus incentives for expatriates is usually determined by _____.

job evaluation

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

Bonuses paid in Japan are _____.

not necessarily related to performance

A(n) _ awards cash or stock if specific goals are achieved

performance share plan

A _____ plan is a hybrid health plan combining the benefits of HMO and _____.

point-of-service; preferred provider organization

A major criticism of standard rating scales is that

raters have different definitions of scale levels

Executives, supervisors and sales staff often receive special compensation treatment because _____.

these jobs face conflicting demands

Roughly _____ of all employees have access to paid life insurance.

three-fourths

A study of unions in 114 companies concluded that _____.

unions make a difference in wages across all studies and time periods