MGMT test 2

Limitations of broadbanding

- changes how compensation is allocated, not how much - may lead to higher compensation costs - may have fewer promotional opportunities available

Enhanced benefit for ex patriot might be their family gets what kind of benefit?

- children in private schools designated for English speaking students - companies compensate expats while they are on leave visiting family

Broadbanding

- consolidate existing pay grades and ranges into fewer, wider pay grades and broader pay ranges. - organizational trend towards flatter, less hierarchical corporate structures - emphasizes teamwork over individual contributions - shifts greater responsibility to supervisors and managers for administering employees compensation

Advantages of broad-banding

- fewer pay grades, simplified, more flexibility, less overhead, reduces administrative burden

COBRA

Consolidated Omnibus Budget Reconciliation Act of 1985

what legislation makes prevailing wage a law?

Davis-Bacon Act of 1931

Stock grant

Employer pays a part of all of the compensation of an employee in the form of corporate stock - firm is investing in your future

is an executive more interested in salary or equity?

Equity

How many, in addition to your CEO, of your top executives, have to provide the IRC with their compensation information?

Highly compensated employees and key employees - CEOs, presidents, executive vice presidents, vice presidents of functional areas, and the directors below them

Which government agency provides the criteria for defining executive status?

IRC (internal revenue code)

Merit pay

Links between pay and performance

Which of the following represents the horizontal dimension of pay structures?

Pay grades

What were the first two benefits besides pay?

Retirement and medical

Person focused

Reward employees for the acquisition of job related knowledge

Advantages of doing pay reviews all at the same time?

Save a lot of time and administrative burden, and you could do it annually

Two tier system or broad banding would a union more likely be open to?

Two-tier

Various pay structures

Two-tier, broad-banding, person-focused pay, sales incentive pay, merit pay

expatriates

US citizens employed in US with work assignments outside the US - international compensation packages based on term of international assignment, staff mobility, equity

Which of the following is a commonly used employer sponsored retirement plan design?

a. Traditional b. Roth c. Qualified contribution d. Defined contribution maybe traditional?

During the 20th century, high incidents of industrial accidents and occupational illnesses prompted which of the following benefits?

a. social security unemployment b. social security disability insurance c. social security survivor insurance d. workers compensation Workers compensation

paid time off for expats

annual vacation, holidays and emergency leave - basically same as domestic

What percent of private-sector and government employees had access to EAP's in 2014

approximately 54% of private sector employees and 74% of government employees

Gal who works at a pharmaceutical, everyone gets 6% flexibility plus life and medical. What kind of plan?

core plus option plan

quarters allowance

displays pertinent information from the US department of states quarters allowances - 3 main sections: survey date, exchange rate and annual allowance by family status and salary range

nonstatutory stock options

do not qualify for favorable tax treatment - executives pay tax on the difference between the discounted price and the stocks fair market value at the time of the stock grant

incentive stock option

entitle executives to purchase their companies stock in the future at a predetermined price (discounted price) - executives get capital gains with stock option - not required to pay tax on capital gains until they sell their stock shares

core plus option plans

extend a pre-established set of such benefits as medical insurance as a program core, which is usually mandatory for all employees - beyond the core employees may choose from an array of benefits options that suit their personal needs - if employees do not choose the max amount of benefits, you can trade extra benefits for cash

Types of benefit plans

flexible benefits plan (cafeteria plan), core plus option plan,

volunteerism

giving one's time to support a meaningful cause - time to contribute to causes of their choice

Difference between stock grant and stock option

grant: you have real money now option: gives you the option to exercise term for grant is disposition

know what a clawback provision is

in CEO employment contracts allow board of directors to take back performance-based compensation if they were to subsequently learn that performance goals were not actually achieved, regardless of whether the CEO was responsible for performance falling short of target levels

Which term is used to describe the pay thread of newly hired employees and more qualified job incumbents is small?

job compression

At what point do you start treating them like an expat

longer than one year

What is a probationary period prior to permitting new employees participation in the company benefits plan?

opportunity to ensure that they have made sound hiring decisions - usually shorter than 6 months

Airline has a layoff, certain services offered, there will be two right answers, pick most right one

probably outplace assistance

basic needs expats get?

protection programs and paid time off

Golden parachutes

provide pay and benefits to executives after a termination that results from a change in ownership or corporate takeover (merger or combining of two companies) - companies can treat these as a business expense - may receive tax deductions

know the concept of disposition

selling shares of stock (act of disposition) - If a stock price at the time of disposition were lower than at the time of the stock option grant, the executive would experience a capital loss

Roth 401K

similar to 401K plans, but have two differences 1. employee contributions are taxed at the individuals income tax rate 2. upon retirement, employee withdrawals are not taxed

are unions for or against contingent workers?

unions are against contingent employment - but some in public sector have begun to accept the use of flexible work schedules

Green circle pay rate

- Below minimum pay range rates - should be brought within the normal pay range as quickly as possible (must eliminate deficiencies in skill or experience that warranted paying below minimum)

prevailing wage

- US secretary of labor determines it based on compensation surveys on different areas and counties represent local areas - typical hourly wage paid to more than 50, convict labor, and hazardous working conditions

Two-tier advantages

- cost control measure - limit layoffs - reward long service employees - cycle: when high paying employees leave, lower paying employee takes their place

Defined contribution plan

- employees have the option to make regular contributions to separate accounts in their names, based on a formula contained in the plan document - employees are given a choice of investment vehicles based on the guidelines established by the employer - companies sometime contribute money with a company match - do not guarantee particular benefit amounts - account balances depend on contribution amounts, company matches and investment performance - can take balance of the account from one employer to the next

pay grade

- group of jobs for pay policy application. - HR professionals group jobs into pay grades based on similar compensable factors and value - no formula to determine terms

origin and reasons workers compensation came about, to fruition

- industrial accidents were very common and workers suffered from occupational illness - first was enacted in 1911

safe harbor rule

- leasing companies become responsible for retirement benefits for leasing employee when these rules are met: - the leased employee must be covered by the leasing companies pension plan which must be 1. a money purchase plan with a non integrated employer contribution rate for each participant of at least 10% of compensation 2. provide full and immediate vesting 3. allow each employee of the leasing org to immediately participate such a plan - leased employee cannot constitute more than 20% of the recipients non highly compensated workforce

Limitations of two-tier

- lower pay scale for newly hired may restrict a companies ability to recruit and retain highly qualified candidates - resentment can build in lower paid employees - can cause lower employee morale - turnover can cause company to have long term implications for productivity and quality

Advantages to common pay review dates within an organization

- most companies do it every two years - They need to see if there is a need for market adjustments - About every month, they analyze different departments - managers can get trained to do it

Why might you wait to give people the benefits 6 or 12 months?

- opportunity to ensure that they have made sound hiring decisions - make sure they do not abuse benefits and leave - waiting to see if they will stay - How does it affect your bottom line, is it ethical? - you may need to cover if a catastrophic thing happens

Red circle pay rates

- paying employees greater than the maximum rates for their pay ranges - help retain valued employees who have lucrative job offers from competitors - may receive for exemplary job performance, particularly when a promotion to a higher pay grade is not granted, may be granted to employees who receive job demotions - allow employees a chance to adjust to pay decreases

Two-tier

- reward newly hired employees less than established employees - reinforce pay rate distinction by retaining separate pay scales: lower pay scales apply to newly hired employees, and current employees enjoy higher paying scales - more prevalent in unionized companies

What are some of the negative impacts to society for increasing the minimum wage

- ripple effect throughout the US economy - could lead to increases in the price of goods and services as companies try to offset higher labor costs - prices increase, consumers are less likely to buy, which leads to less production, which leads to layoffs - forces companies to reconsider its total compensation packages - planning budgets is difficult if their could be a raise in minimum wage - pay inequities: lower payed workers, get closer to the higher paid workers

When did the great recession occur?

2007-2009

skill blocks

are sets of skills (knowledge) necessary to perform a specific job or group of similar jobs - person-focused structure can contain two skill blocks to several - job description is necessary and jobs should be organized in job families, should be grouped into blocks

indemnity plans

based on a contract between the employer and an insurance company - contract specifies expenses and rate that they are covered

protection program for expat

basically same as domestic - don't want to be unfair

flexible benefit plan pros

benefit satisfaction, overall job satisfaction, understanding of benefits increased after the implementation, reduce absenteeism and turnover - allows custom fit, diversity in the workplace, people have different needs

at the XYZ company, the board took back performance compensation from CEO because of the buyout decision he/she made lowered their value. What is this called

clawback provision

integrated paid time off policies

combine holidays, vacation, sick leave, and personal leave policies into a single paid time off policy - don't need reason

What is "self-funding" for your company health care plan

companies pay benefits directly from their own assets with either current cash flow or funds set aside in advance for potential future claim - makes sense to do when a companies financial burden of covering employee medical expenses is less than the cost to subscribe to an insurance company for coverage - retains money that would go to paying premiums to independent carrier

Phantom stock

compensation arrangement whereby boards of directors promise to pay a bonus in the form of the equivalent of either the value of the company shares or the increase in that value over a period of time - two conditions: must remain employed for a specified period and then must retire - then they receive income equal to the increase in the value of the company stock from the dates phantom stock was granted - pay taxes after they convert their phantom shares to real shares during retirement

cafeteria plan

employees within a company can choose from among a set of benefits , as opposed to all employees receiving the same set of benefits - implemented to meet the challenges of diversity - two most common types: flexible spending accounts (permit employees to pay for certain benefits expenses with pretax dollars)

tax equalization and ex pats

employers take the responsibility for paying income taxes to the US and foreign governments on behalf of expats - process that ensures that the tax costs incurred by an expat approximate the cost of taxes he or she remained at home - expat doesn't suffer financial hardship nor realizes a financial windfall from the tax consequences of an international assingment

A 401k plan is which of the following retirement benefits?

enable employees and employers to defer part of employee compensation to an employee's account maybe discretionary

What is COBRA? How long is it enacted for?

enacted to provide employees with the opportunity to continue receiving their employer-sponsored medical care insurance temporarily under their employer's plan if their coverage otherwise would cease because of termination, layoff or other change in employment status - continued coverage as well as coverage for their spouses and dependents for up to 18 months - can be up to 36 months if dependent facing a loss of employer-provided coverage because of a death, divorce or qualifying event - this is still pricey though

pay review rates

established so that all employees performances are evaluated on the same date or during the same period - best suited for smaller companies - reduces administrative burden of the plan by concentrating staff members efforts to limited periods

Pay compression

occurs when a company's pay spread between newly hired or less qualified employees and more qualified job incumbents is small - situations result in pay compression 1. company's failure to raise pay range minimums and maximums. 2. scarcity of qualified candidates for particular jobs, if company needs people, raise the salary for new hires

Services employees receive when they are laid off?

outplacement assistance which provide technical and emotional support - they do so with a variety of career and personal programs designed to develop employees' job hunting skills and strategies to boost employees' self confidence - also personal counseling, career assessments, resume building, interview techniques, training with tech

sabbatical leaves

paid time off for such professional activities as a research project or curriculum development - common in college and unv settings - or professional and managerial employees who stand to benefit from intensive training opportunities outside the company's sponsorship

flexible spending account

permit employees to pay for specified health care costs that are not covered by an employer's insurance plan - employees put amount in, and employers then use this money to reimburse employees for medical expenses incurred during the plan year that qualify for repayment - use it or lose it - must predict how much you will need - can't carry over balances, and employers do not give it back at the end of the year if there is leftover - high risk - people low ball the number so that they do not have leftover after a year

Which sector are some unions more likely to support the use of contingent workers?

public

Employers usually rely on what source to determine housing and utility support?

quarters allowances table

Benefits of a health promotion program

reducing workers compensation claims - eliminate health risks - pay more attention to safety and health - advertising/promoting wellness

enhanced benefits for ex pats

relocation assistance, education reimbursements for expats children, home leave benefits and travel reimbursements, rest and relaxation leave and allowance

which strategy helps contain workers compensation costs?

safety and wellness programs

stock option

two types: incentive stock options and nonstatutory stock options

When are you disqualified from unemployment?

when you quit or fired for serious reasons

Temporary employment agencies are responsible to comply with all employment legislation except for one.

workers compensation