Compensation and Benefits

Variable pay is always better than performance-based pay.

FALSE

A company cannot have a hybrid strategy.

FALSE

An organization does not need to investigate if the increases in productivity offset the higher wage rates

FALSE

Benefits utilized by a very small minority of employees should not be scrutinized to ensure that they are in line with the organization's interests.

FALSE

Employees perform better when they do not receive feedback.

FALSE

Gaining buy-in for a job analysis is not necessary to create a value-added analysis.

FALSE

Group-based Variable Pay ties rewards to the collective actions and results achieved by each individual in a group?

FALSE

If skills are scarce and the demand for those skills is high, the compensation levels will be relatively low as firms compete for scarce skills?

FALSE

In the development stage it is not important to also design a training support system that is customized to the skills or competencies in the system.

FALSE

Location is not a part of the Intangible Rewards pie.

FALSE

One disadvantage to a profit sharing plan is that when the organization has a profit loss, employees owe a certain percentage of their income to the organization.

FALSE

Performance-based pay helps ensure that when performance is high, the company's cost structure is also increased.

FALSE

Recognition, Meaning and Culture are all examples of Tangible Rewards?

FALSE

The capability-based approach makes a surprisingly similar assumption to the job-based approach about how rewards should be determined.

FALSE

There is not a degree of correspondence between pay grade size and range size.

FALSE

When calculating a salary, it is generally to the employee's interest to use the mean versus the weighted average?

FALSE

All capability-based pay systems require sources of skill- or competency-related information.

TRUE

As organizations systematically define their activities in light of their values, there will be a gradual shift towards being involved in businesses with a more value-driven purpose.

TRUE

Autonomy gives employees discretion in choosing what to do and how to do it.

TRUE

Benefits can be one mechanism to counteract the forms of pay in order to maintain the employee/organization connection.

TRUE

By using pay form-specific strategies, organizations can create more customized reward systems that are more likely to differentiate them from their competition in the labor market.

TRUE

CSFs take into account both internal strengths of the organization and the external values of customers and markets.

TRUE

Care must be taken to ensure that the distribution of spot awards is based upon legitimate performance behaviors, guarding against a perception that the spot awards are only given to the managers' preferred employees.

TRUE

Competencies should be measured consistently across employees and raters.

TRUE

Culture can be "seen" in the artifacts of the organization such as its stories, rituals, systems, politics, and use of physical space.

TRUE

Each of these approaches needs to be understood to allow an organization to decide upon its Total Rewards Strategy and systems.

TRUE

Employees find psychological rewards in being part of an organization that aligns with their values.

TRUE

Gain Sharing is a system of establishing a baseline of unit-level results and sharing improvements above that baseline with employees in that unit.

TRUE

Geography has a significant impact on how an organization should define its labor markets.

TRUE

In a Spot Award system, managers are given a cash budget from which they can immediately draw to provide employees with instant recognition of a high performance.

TRUE

In a purely job-based system, a highly skilled manager with an MBA who is preparing food in a fast-food restaurant would be paid the same amount as a high school dropout performing the same job.

TRUE

In an Individualistic Environment, where work is done independently by single employees reporting to a single supervisor, the many grades can capture the simplicity of that working arrangement?

TRUE

In the development stage it is important to also design a training support system that is customized to the skills or competencies in the system.

TRUE

In the individual-based pay system, a company would want to hire and retain a better qualified employee.

TRUE

Intangible Rewards Defined as psychological, social, and contextual factors in organizations outside the traditional pay and employee benefits categories that are rewarding to employees.

TRUE

Intrinsic Motivation Theory (Maslow) Stipulates that employees attribute their behavior to internal and external causes; also referred to as Self-determination Theory.

TRUE

It is wise to leave a buffer zone around the current pay rates to ensure that the range is adequate.

TRUE

Job descriptions are simple and cannot contain every detail relating to the job.

TRUE

Job evaluation is a tool to help organizations create internal reward alignment that is both equitable and conducive to effective employee performance.

TRUE

Merit pay budget and cost of living adjustment pay increases for all employees to account for inflation.

TRUE

Organizational Culture The shared beliefs, values, norms, and assumptions of the organization.

TRUE

Organizations can ask employees directly about their benefit preferences.

TRUE

Organizations face certain challenges when making the connection between the Internal Job Value Structure and the monetary value created externally in labor markets.

TRUE

Over the past two decades, organizations have tried to understand how many pay bands they should have.

TRUE

Pay compression is when: New employees and long-tenured employees are paid very similar amounts

TRUE

Pay grades are useful as they allow organizations to simplify reward systems because similar jobs can all be treated in the same way.

TRUE

Pay inversion occurs when: New employees are paid more than those employees with substantial experience in the organization

TRUE

Product and service markets are where organizations compete to create organizational completeness through the production of products or the provision of services for customers in exchange for money or loyalty?

TRUE

Reliable Measurement means that an employee's level of skill, competency, or experience can be assessed consistently across employees and raters.

TRUE

Stock options are often reserved for executive compensation plans.

TRUE

The Intrinsic Motivation Theory stipulates that employees attribute their behavior to internal and external causes.

TRUE

The Pay as Meaning principle states that the rewards employees receive from organizations have informational value in addition to their economic value.

TRUE

The first challenge in creating a capability-based pay plan (or "system") is to define those individual characteristics that create value for the organization.

TRUE

The goal of job analysis is to understand the work involved in creating value for the organization.

TRUE

The goal of job evaluation is to create a way to measure the value (and relative value) of each job in the organization.

TRUE

The idea of Central Tendency is to find a single number that best represents a who group of numbers?

TRUE

The purpose of grades is to allow jobs creating the same amount of value for the organization to be treated in the same way.

TRUE

Total Rewards are one of those decisions that businesses make that influences their cost structure and their ability to provide those low costs to customers.

TRUE

Transparent Measurement means that the criteria and system should be easily understood and the processes for implementing the system should also be sorted out by all employees.

TRUE

Understanding relevant tools for a job, such as Microsoft Excel or Power Point, are valuable in creating a job description.

TRUE

Using pay grades is useful because it allows the organization to establish different pay strategies for different pay grades.

TRUE

When a reward system explicitly attempts to vary rewards based upon the capabilities of the employee, it is referred to as capability-based Pay.

TRUE

When choosing strategies, organizations should use logic and evidence about how job value and pay forms meet business objectives.

TRUE

When employees have quality relationships with their peers, it can create a climate of acceptance and collectiveness that provides intangible rewards to employees.

TRUE

When establishing pay grades, jobs are declared "similar" on the basis of their Job position points, which represent the organization's external measure of the value of jobs.

TRUE

When total rewards is used to change a culture, past norms should still be considered.

TRUE

Within individual-based systems value is assumed to derive from the characteristics of the person within the job, and therefore pay should be driven by the knowledge, skills, experience, or competencies of that individual.

TRUE

Workplace relationships is a form of Intangible reward.

TRUE