C236 Compensation and Benefits
How can central tendency in compensation be used to improve a market analysis?
By finding the single number that represents how many people are paid
What is the foundation of external reward positioning in an organization's overall compensation program?
Reward surveys
What is the relationship among laws regarding pay?
The benefit to employees dictates which law is followed.
Which element of a job description includes the knowledge, skills, and abilities that an employee needs to perform the job at a satisfactory level?
The job specification
Workers in a small manufacturing company are currently paid whatever the CEO feels is appropriate. The company's new compensation specialist intends to determine the relative worth or value of each job in the company as part of setting a new salary scale. Which human resource activity will this compensation specialist be conducting?
A job evaluation
What is merit pay?
Annual increase based on past performance
A company that produces poker chips intends to benchmark its rewards system. Which method should be used to select the benchmark in this scenario?
Benchmark competitors
A firm publishes a monthly newsletter highlighting top employees and their contribution to the community and firm. Which benefit would the firm derive from this decision?
Better alignment with the employee purpose principle
A manager is confronted by an employee who says she is thinking about a job offer from another company. Subsequently, the manager wants to collect verifiable data on what competing organizations are paying so the organization can match up with the market. From where can the manager collect this data?
Bureau of Labor Statistics
Which pay system is often used in sales jobs to motivate employees to increase both the number and size of sales that are made?
Commission
An employee has worked for the same company in two locations over the course of 20 years in Europe and North America. The employee has been trained as an international trade specialist and has been promoted to manager of international operations. Which pay basis should be used to compensate this employee?
Competency-based pay
An employee is assigned the task of designing the job-value structure at his company. The employee has defined which jobs are within the organization and how they are related. What is the next step in defining the job-value structure?
Determining job importance
Which provision applies if a job is covered by the Fair Labor Standards Act?
Employees who work more than 40 hours in a week must be paid time and a half for each hour they work over the 40 hours.
Which benefit program is federally mandated and allows employees time off for the birth of a child?
Family and Medical Leave
An applicant for a job has a preexisting medical condition that requires special drug treatments. The application for the job is declined after the company contacts the applicant's former employer and learns about the preexisting medical condition. Which legislation has the applicant's former employer violated?
Health Insurance Portability And Accountability Act
Which challenge to market analysis is present if a company expands into an international market that has marginally trained workers?
Inaccurate data
A firm has strong alignment between their core principles and the principles of the employees. As part of their communication system, the firm decides to put out a monthly newsletter highlighting top employees and the good that their work is doing in the community and at the firm. Which benefit would the employees derive from this decision?
Intangible validation of their efforts under the purpose principle
At which step in job analysis do employers determine the tasks, duties, and responsibilities of a job?
Interview incumbents
What is the next step in the job analysis after identifying the job and observing the workplace?
Interview incumbents
To what does internal reward alignment refer?
It refers to how an employee's rewards compare to rewards received by others in the organization.
Several jobs have been grouped into job families based on their functions within the organization. Compensation levels must now be determined to establish internal award alignment. Which part of the job structure describes this human resources activity?
Job evaluation
Which two approaches apply to internal reward alignment?
Job-based approach & Individual-based approach
Which type of market gives job seekers more negotiation power than employers?
Labor-driven
Which type of market gives job seekers more power in negotiating terms of employment?
Labor-driven
Which compensation method is an annual pay increase based on past performance that is added to an employee's base compensation?
Merit pay
Which method for addressing wage and salary compression does an employer use to pay for future performance based on past performance?
Merit pay
An employee fell off a ladder while working and broke a bone. Why did this person receive workers' compensation coverage?
No-fault principle
Which job analysis technique is used to collect information by monitoring the work of employees?
Observation
Which employee benefit is a company not legally required to provide?
Paid leave
An employer has several job incumbents come together to analyze a job. Which job analysis method is used in this scenario?
Panel interview
A professor who has been at a public university for eight years became aware of a website that lists the salaries of all public sector employees in the professor's state. On the website, the starting salaries of two new professors hired in the department were listed as higher than the veteran professor's current salary. What is the major issue being described in this scenario?
Pay inversion
An employee is getting bored with her job because she has mastered her basic work activities. What is a good way to keep this employee motivated?
Provide a wider variety of tasks to accomplish
A firm is looking for ways to reward its employees and motivate them to work harder. The firm decides to allow top-performing employees to spend a certain portion of their day working on independent projects that they feel can benefit the firm in the future. Which type of reward is this firm offering?
Psychological reward
A company implemented actions to improve its return on investment on human capital. The company wants to be the premier employer in the state. The first step was giving more rewards for jobs compared to its competitors. Which type of reward system is this company using?
Relative
What is a key concern when designing a variable pay system?
The behaviors that are rewarded need to match the behaviors that are most valued to the organization.
An employee is immediately terminated after being caught embezzling from a firm. The employee has received good but not outstanding performance reviews and is in good health. The employee is a parent of two young children and is not currently enrolled in school when terminated. The employee begins seeking gainful employment immediately after being terminated. How will this situation affect the employee's eligibility to qualify for unemployment compensation?
The employee will be unable to qualify because the employee was terminated for cause rather than involuntarily.
A human resources professional at a large law firm needs to fill an accountant position. The job description provides information about the compensation range, firm location, number of employees in the company, minimal qualifications, and company values. Which part of the job description did the human resources professional fail to include?
The job content
What is the definition of a leading market rate strategy?
The organization provides more of a reward than its competitors.
A company uses a series of pay grades to set salaries which characterize the firm's pay grade system. he company sets its salary bands so a highly skilled employee in a lower pay grade may earn more than a less skilled employee in a higher pay grade. Which principle of setting competitive pay policies is the company following?
The principle of overlap
A medical supply company recently announced it is offering a week-long, all-expenses-paid vacation to Hawaii for the salesperson who sells the highest number of a new model of hospital beds in the upcoming quarter. Why might a salesperson be unmotivated in this situation based on the instrumentality perception of expectancy theory?
The salesperson has won similar competitions in the past, but his company retracted the rewards that were offered.
Why is it important to evaluate pay systems and keep them current?
To attract top employees
A firm bases its pay systems on rewarding the best employee with a large bonus, while giving only standard pay to all the other employees. Additionally, the employee's picture is posted on the wall with a notice about the accomplishment. Which employee motivational theory is this organization practicing?
Tournament theory
The CEO of a web development company gives employees a lot of freedom to develop new applications, pays employees by the hour, and allows employees to work as needed to develop applications. Because of this approach, the payroll costs vary quite a bit. The CEO would like to get costs under control and make payroll costs more stable. Which approach can be used to bring payroll costs under control and make them more stable in this situation?
Transition employees from an hourly pay model to a salaried pay model
Which benefit is a statutory benefit that is administered by both the state and federal governments and allows employees to receive compensation for job-related injury or illness?
Workers' compensation