HRM/324T: Total Compensation

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The compensation system at Fresh Munchables aims to better align with its strategic goals and culture. The compensation team has performed an internal evaluation of each job and has analyzed the external market. Which of the following analyses should the team use in order to integrate the job evaluation and market data?

A t-test analysis because it allows for comparison of the means of two groups WRONG A Pearson's correlation analysis because it shows how tightly two variables are correlated

A t-test analysis because it allows for comparison of the means of two groups. WRONG An ANOVA because it allows for comparison of the means of several groups WRONG A Pearson's correlation analysis because it shows how tightly two variables are correlated

Although Fresh Munchables has been hiring many young and highly educated people lately, the company still strongly values its more tenured employees who have been with the company for many years. It's important to the company that all employees, regardless of demographics, are paid fairly within their respective pay ranges. As Fresh Munchables is building out its new compensation system, the compensation team must establish pay ranges that allow for growth within a job.

Allow pay ranges to slightly overlap successive pay grades in order to allow for higher performance-based pay without moving grades.

Fresh Munchables' compensation system has stayed the same for many years. The newly hired chief human resources officer is stunned to discover how outdated it is, as the company has grown and changed significantly over the years. However, changing the company's compensation system is not cheap, and Fresh Munchables' executive team is hesitant to act. What information could the chief human resources officer share to convince the executive team that building a new compensation system is worthwhile?

An aligned compensation system will improve culture, morale, performance, and the company's brand. An aligned compensation system will produce higher-caliber managers, directors, executive team members, and employees. An aligned compensation system will improve diversity, company presence in the media, public relations, and costs. An aligned compensation system will improve performance, retention, perceptions of fairness, and efficiency.

Liping was an employee in the marketing department at Fresh Munchables. As time passed, she became dissatisfied with her own pay after realizing that the sales team made more than she did and that they also received quarterly bonuses based on their sales numbers. Liping felt that her efforts in marketing led to more sales by the sales team and that the division of pay was unfair. Unfortunately, her manager wasn't able to provide satisfactory answers to her questions about why the two departments were paid differently and Liping soon quit. Fresh Munchables does not want such a situation to occur again. While developing a total rewards system, the compensation team should do their best to build a model that is ________.

Clear and logical, because it will allow the employer to justify their compensation-related decisions.

After the departure of more than a few employees over the past six months, the management team at Fresh Munchables is concerned about employees' happiness and job satisfaction. The company has raised wages and found the best possible health care plan; yet, it still struggles to keep long-term employees. Which strategy can the management team use to figure out how to retain employees and increase employee satisfaction?

Conduct a survey asking employees what benefits they want in order to gain useful information about preferred compensation plans.

Reliable measurement means that an employee's level of skill, competency, or experience can be measured ___________ across employees and raters.

Consistently

Which of the following is NOT an example of a job family?

Consultant

After the deductible has been reached, organizations often have a ________ approach in which the insurance only pays for a portion of medical expenses.

Cost-sharing

Fresh Munchables, like any company, constantly goes through changes in staffing, staffing needs, company revenue, compensation plans, and strategy. As an HR manager, you know it is essential to comply with all relevant employment laws to manage your employees appropriately and to ensure specific groups are not unfairly targeted. What is an advisable course of action in your role?

Create a diversity and inclusion document and post it publicly. Attend all upper management meetings to be sure human resource concerns are addressed. Assign specific employees as whistleblowers to ensure the company satisfies legal and ethical regulations. Conduct follow-up research including surveys to gauge employee reactions to changes.

The compensation team is trying to determine the total number of pay grades that should be used in the engineering unit of Fresh Munchables. This unit has sometimes struggled to meet productivity goals but overall contributes to the company's mission to provide high-quality products to consumers. The engineering unit includes several dynamic job positions, and employees frequently change responsibilities as they work on a variety of different projects. Some engineering employees are promoted to become managers, but others later use the skills they have learned to apply for jobs at other companies.

Create a loosely organized structure of pay grades to align with the flexible job responsibilities in engineering positions.

Which of the following is NOT a step in creating a capability-based pay structure?

Develop protocols

Which of the following does organizational performance NOT include?

Developing employees

Which of the following will NOT enhance procedural justice?

Device strategy

When low distributive justice occurs, which of the following changes will employees NOT make?

Earning lower rewards

What is a networked career?

Employees change jobs frequently, sometimes changing functions and industries

When Fresh Munchables started out, it used spreadsheets to manage wages, sales, and inventory. Although the company has grown exponentially, it still uses an outdated system. The compensation team is now looking for a computer systems analyst to manage the company's disorganized system and solve any computer-related issues. Due to the nature of this role, the compensation team will consider this employee exempt from the overtime provisions of the Fair Labor Standards Act (FLSA). Why would it be beneficial for the company for this employee to be exempt?

Exempt employees work flexible hours and are not paid overtime, unlike nonexempt employees.

The sales department of Fresh Munchables had a difficult time making sales in May and June. As a result, the sales manager decided to hold a contest in which salespeople were awarded points for each sale made to a retail customer in the month of July. The salesperson with the most points at the end of the month will receive his or her choice of a prize from the following options: a cash bonus, an extra week of paid vacation time, or a luxury watch. After the first-place salesperson chooses a prize, the salespeople who come in second and third will receive their choice of the remaining two prizes. In addition, all salespeople who improved their sales record from the past two months will receive a $25 gift certificate to a restaurant of their choice.At the end of July, sales had more than tripled since the beginning of May. The sales department had done exceptionally well that month, and the employees enjoyed the prizes that they had worked hard to earn.Which theory of motivation best explains why the contest effectively increased employee performance?

Expectancy theory, because the manager distributed rewards consistently and allowed employees to choose the reward they valued most

The relative level determines if the rewards strategy is ________.

Greater than, equal to, or less than a labor market reference point

According to the reading, as recruited employees negotiate for higher salaries, they are more likely to receive such salaries if they have ________.

Greater work experience

Which of the following is NOT an approach to an internal reward alignment?

Group-based approach

Ena is a mechanical engineer with a history of good performance. He has worked at Fresh Munchables for six years and makes roughly $67,000 a year. Phillip is also a mechanical engineer, but has had poor performance in recent months. He has worked for Fresh Munchables for two years and makes roughly $76,000 a year. Ena recently became aware of the pay discrepancy, and he is upset by the injustice. He brings the issue to the attention of the HR department.

HR should evaluate the company's internal reward alignment and Ena's recent performance, then correct Ena's current pay level in order to ensure pay equity.

The HR department at Fresh Munchables is working hard to recruit and hire candidates for a systems engineer position. Systems engineers have the knowledge, skills, and abilities (KSAs) that are vital to the success of the organization. Unfortunately, the role of systems engineer is in high demand across the industry, making it more difficult to attract candidates to hire. What should the HR department do in order to fill this position in a labor-driven market?

HR should make the total compensation for the role relatively high in order to attract the desired candidates.

The HR department at Fresh Munchables is working hard to recruit and hire candidates for a systems engineer position. Systems engineers have the knowledge, skills, and abilities (KSAs) that are vital to the success of the organization. Unfortunately, the role of systems engineer is in high demand across the industry, making it more difficult to attract candidates to hire.What should the HR department do in order to fill this position in a labor-driven market?

HR should make the total compensation for the role relatively high in order to attract the desired candidates.

What ethical framework involves believing that predetermined rights are held by both individuals and societies?

Health savings accounts

The advantage of the job comparison approach is that it is __________.

Holistic

Several new positions have recently been created to streamline the delivery of ingredients from Fresh Munchables' factories to its restaurants. The CEO of Fresh Munchables wants the HR department to figure out how much each position should be paid based on the company's internal rewards alignment. What question should not be considered in order to make these new positions fit within the company's pay structure?

How should two employees with similar duties but different titles be paid? How well does each position's rewards align with those received by others in the company? How can the company maintain good morale, collaboration, and information sharing among employees? How well does each position's rewards align with those received by others in similar positions in competing companies?

All of the following are components of an organization's strategy that should be accounted for when developing a total rewards strategy, EXCEPT ___________.

How the company was founded

Which of the following is NOT a function of human resources?

Human resource information system

Without any grade structure, a job-based pay strategy could involve how many different reward strategies in one organization?

Hundreds

The instrumentality perception asks ____________.

If I perform, will I receive the reward?

One of the strategic goals for the restaurant and dining business unit at Fresh Munchables is to improve its human capital by attracting target employees. This unit is becoming increasingly vital to Fresh Munchables' success, and in order for Fresh Munchables to reach its goals, the restaurant and dining unit must have the right talent. With this knowledge in mind, what might the compensation team at Fresh Munchables work toward in order to achieve the desired outcomes?

Ignore the market, because hiring and compensation goals should not be stipulated by external factors Lag the market in total compensation, because the savings will make up for the lack of needed talent Match the market in total compensation, because it is cost-effective and suitable enough to draw in talent Lead the market in total compensation, because this will help draw in the desired talent

An employee's satisfaction with work is heavily influenced by their __________.

Immediate supervisor

As a compensation manager, you will ________.

Improve compensation systems and better enable your organization to meet its goals

The executive team at Fresh Munchables has just updated the company's mission statement based on responses to a recent employee survey asking questions about the company's vision, values, and purpose .By aligning the company values with that of its employees, what can the company's executives expect to see?

Improvement in employee satisfaction and motivation, because aligning employee and company values creates a sense of purpose in an organization.

The HR department at Fresh Munchables is considering a job comparison approach for establishing internal alignment. Fresh Munchables has been around for several decades, but it has always struggled with determining appropriate compensation for different levels of jobs. What is true about a job comparison approach that would benefit Fresh Munchables?

In the job comparison approach, jobs are valued in comparison to other jobs in a company using a point system, which allows for pay to be determined by a job's importance to the organization.

The executive team at Fresh Munchables is working to increase collaboration and flexibility in regard to compensation. They are also trying to motivate lateral changes within the business operations unit without facing compensation-related barriers.

Incorporate broadbanding because it allows employees to manage career changes within the organization without a reduction in compensation.

The CEO of Fresh Munchables has asked you to review the company's health care plan, specifically its premium-sharing policies. In the past, the company paid a huge portion of its employees' medical insurance while employees paid very little. Now that the company has grown and many more employees have been hired, this model is becoming unsustainable. The company has also conducted an internal review and found that many employees may be overutilizing their benefits. How can Fresh Munchables still offer quality health insurance to their employees while also encouraging employees not to overuse their benefits?

Increase the deductible employees pay for each service in order to maintain the same level of coverage at a lower employer cost.

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

Individual-based systems

Recently, members of the janitorial staff at one of Fresh Munchables' factories have complained about unsafe working conditions and poor treatment from other manufacturing employees. In order to remedy the situation, HR manager Anisha has been working with facilities management supervisor Josh to make some significant changes to his department, such as providing the staff with more safety equipment and carefully addressing negative relationships in the workplace. Anisha and Josh want to ensure that the janitorial staff feels safe, empowered, and valued as contributors to the company's success. Why should Fresh Munchables' managers make these large changes to improve the department's intangible rewards, rather than simply increasing the employees' wages?

Intangible rewards are important, but an increase in pay will better increase employee satisfaction. Intangible rewards are not crucial in this case, as it is common for low-level employees to feel less valued and appreciated. Intangible rewards, such as employee status, job title, and salary, are crucial for increasing employee satisfaction. WRONG Intangible rewards, such as psychological, social, and contextual factors, are crucial for increasing employee satisfaction.

The rollout of capability-based pay systems, like all reward system changes, should be accompanied by what?

Intensive communication

Because Fresh Munchables has grown so much since its inception, the CEO wants to revisit the company's methods for establishing internal reward alignment. The executive team has advised the HR department to use a job classification approach. However, you disagree. What information could you use to show the executive team one primary disadvantage of using a job classification approach?

It is difficult to create distinctions between jobs as the number and types of jobs in an organization grows.

Fresh Munchables has acquired a new freeze-dried meat company, and employees now qualify for discounts for packaged meat products. Kenna, a supervisor, has been told by the HR team to provide her employees with formal training, supervisor-based training, and accessible online information so that they can be informed about these new benefits. Why would communicating these rewards through multiple different methods be beneficial?

It provides a high level of accuracy and transparency for all employees.

Which approach is a way to establish internal reward alignment?

Job-based approach

In a ________, the job itself is the fundamental unit for designing the rewards system.

Job-based system

One goal that is crucial for Fresh Munchables' success is obtaining new retail locations in order to increase revenue streams. With that in mind, the company wants to reward the business operations unit if it reaches its goal of opening 100 new retail locations in the next year. If the goal is met, each employee in the business operations unit will receive a fixed individual bonus.

Keep fixed rewards the same and increase variable rewards in the form of a bonus.

The executive team at Fresh Munchables wants to expand the research and development division, which would require the company to attract and hire more food engineers. The overarching compensation goal for this specific job is to pay the job market rate in total compensation. The target population, in general, is highly motivated by a high base salary. What might you do to attract the target population of food engineers and meet the company's desire to match the market in total compensation?

Lead the market in base pay but lag in variable compensation.

During an economic downturn, Fresh Munchables has reached the difficult decision to begin cutting salaries as a way to offset lost revenue. As the HR manager, you are responsible for proposing and implementing a compensation plan for employees at various locations and levels during this time. This has the potential to be a complex ethical dilemma that requires many different considerations.

List the rights of all parties involved and make sure that the decision respects those rights. Take first consideration for those who might be marginalized, including those in an underrepresented ethnic, race, gender, or age demographic. Make a decision based on what is best for the organization rather than the individuals in the organization. Consult with a third-party organization or legal representative immediately.

Due to some unforeseen circumstances, Fresh Munchables' HR director asked certain managers to let a number of employees in their departments go because of budget restrictions. Those managers suggested laying off some of the most senior workers in their departments, many of whom are in their 50s and 60s. Before going through with the layoffs, HR first needs to review the managers' suggestions to ensure that the layoffs would not be discriminatory under the ADEA. Which of the following describes why older workers may have been systematically targeted for layoffs at Fresh Munchables?

Longer-tenured employees typically receive higher compensation

Sulli is currently an HR manager at Fresh Munchables. The director of HR has tasked Sulli with making the paid leave system more streamlined. The company is currently offering various forms of paid leave, including vacation time, holidays, sick days, and personal days. What is the best way for Sulli to produce her director's desired outcome?

Lump the various forms of paid leave into a paid time off bank.

Fresh Munchables has recently hired some teenagers to help with some tasks that are safe, simple, and also require only a limited number of hours of work per week. José, a compensation specialist, and Don, the department manager who oversees the teenage workers, both want to ensure that they are complying with the law. In addition to complying with the law, what else do José and the department manager need to do?

Maintain a record containing all the compliance information.

Which is NOT discussed as a group of work relationships?

Manager relationships

What industry is commonly known for using the piece rate system?

Manufacturing

In which industry is skill-based pay most often used?

Manufacturing industry

Pay inversion occurs when __________.

New employees are paid more than those employees with substantial experience in the organization

A supervisor suggested paying salaried employee Gregory less in April this year, because last year Gregory averaged only 25 hours a week. However, the supervisor wants to pay Gregory more this May because Gregory has worked an average of 55 hours per week this year. The supervisor's suggestion was denied because José, a compensation specialist, knows that if an employee is salaried, the company cannot change compensation irrespective of hours worked .Should the company make changes to Gregory's compensation, and why or why not?

No, because the company may face fines and back payment of overtime.

A supervisor suggested paying salaried employee Gregory less in April this year, because last year Gregory averaged only 25 hours a week. However, the supervisor wants to pay Gregory more this May because Gregory has worked an average of 55 hours per week this year. The supervisor's suggestion was denied because José, a compensation specialist, knows that if an employee is salaried, the company cannot change compensation irrespective of hours worked. Should the company make changes to Gregory's compensation, and why or why not?

No, because the company may face fines and back payment of overtime.

Fresh Munchables has a factory that requires some employees to perform jobs in less than desirable work conditions. For example, employees often work in rough conditions, handle potentially dangerous material, and in some cases, are required to work through the night. The company wants to be able to attract and retain talent, and they also want to provide its employees with fair compensation for their hard work. Assuming the factors outlined above have not been accounted for in the company's compensable factors, which of the following should Fresh Munchables do to provide its employees with fair compensation?

Offer employees a large end-of-year bonus to incentivize them to work in undesirable conditions.

Fresh Munchables has traditionally paid minimum wage for low-level positions. However, the company is having difficulty attracting employees to work in its food processing facilities. Some of these jobs require night and weekend hours. Which of the following types of compensation would be most helpful for the company to offer to potential employees in the Fresh Munchables food processing plant, and why?

Overtime pay, because it provides an incentive for employees to work additional hours Shift pay, because it provides additional compensation for hours worked at undesirable times Reporting time, because it gives employees more control over the hours they work Paid vacation time, because it shows employees that the company is generous with its benefits

One of the ways that Fresh Munchables grows its revenue streams is by finding new retail locations to sell products. The company is currently seeking to grow its client base and has established a search team to seek out and acquire new retail locations. The search team is composed of self-motivated employees with a growth mindset toward development and goal achievement, and they are currently being paid a base salary. The compensation team is going to revise the current pay plan to motivate these employees even further.Which of the following forms of pay will help Fresh Munchables reward the desired behaviors?

Performance-based pay, because it provides an incentive for the team members to produce the desired result of growing the company's client base

What is variable pay?

Performance-based rewards and long-term equity

What is another term for "fringe benefits"?

Perks

In an effort to help frontline employees feel more valued, Fresh Munchables would like to give managers the autonomy to reward employees in real time for "above and beyond" effort on a weekly basis. Which of the following approaches will best help the company reward frontline employees for outstanding effort and performance?

Permit managers to give out spot awards, because spot awards can be given immediately to reward employees.

When the values of an employee align with the values of the organization, it is referred to as __________.

Person-organization fit.

________ are used when the employee is free not to come into work, even if they are not sick.

Personal days

________ systems reward employees with a fixed amount of compensation with each unit of work they produce.

Piece rate

What is a differentiation strategy?

Placing a high priority on providing innovative, exceptional, and high-quality products and/or services to customers

Anthony is hoping to be considered for a high-pressure and high-paying job at Fresh Munchables, but he has a concerning preexisting heart problem. In addition to the Health Insurance Portability and Accountability Act (HIPAA) covering his medical needs through health insurance coverage, what else does HIPAA do to protect Anthony and other employees with health-related concerns?

Protects employees' privacy and prevents health-related information from influencing employment-related decisions Requires employers to keep an easily accessible document with health-related information on each employee to assist them with their health concerns and needs Improves the quality of care and ensures that coverage is the same regardless of the position Does not allow their insurance deductible to increase due to a change in position, even a higher-paid position

A new supervisor position has opened up at Fresh Munchables, and two of the top candidates are current employees who work in the same department. Rita has a positive, uplifting relationship with her coworkers, and Bob, although not well-liked by his coworkers, has been working at the company longer and is more familiar with company procedures. Considering the satisfaction of the employees who will work under the supervisor, who should you pick?

Rita, because employee satisfaction increases when employees have a good relationship with their immediate supervisor.

When graphing the salaries in a value reward line, what type of graph would give the best picture of salaries?

Scatterplot

Relationships at work include all of the following EXCEPT ________.

Self

Fresh Munchables' new HR manager wants to increase the compensation rate so that each employee in one department is paid the same. Specifically, all employees would be paid as much as the highest-paid employee. This recommended proposal was denied. The HR manager explained that if a job requires equal skill, effort, and responsibility, and is performed under similar working conditions, employees should be paid the same irrespective of their gender or other personal considerations. However, what other factors could appropriately influence employee compensation?

Seniority and merit, because they are nondiscriminatory classifications for higher pay.

While developing the new compensation system at Fresh Munchables, the compensation team decides to ask an HR generalist for assistance. The HR generalist doesn't have any formal experience in the area of compensation but is well informed about the concerns and desires of the management team. Within her realm of experience, how can the HR generalist best help the compensation team to create strategic compensation to benefit the company as a whole?

She can help align compensation with the company's business strategy to reach its current and future goals.

Rewards strategies that work in the ________ term while the firm is niche-focused may be forced to change in the ________ term.

Short; long

________ is/are used when an employee does not attend work, but it is expected that the employee is actually unwell.

Sick days

When creating a benchmark, a company should compare itself to ____________.

Similar organizations in the same industry

When creating a benchmark, a company should compare themselves to ________.

Similar organizations in the same industry

The magnitude of the reward overwhelms the perception of ________ odds.

Small

The marketing department at Fresh Munchables is having trouble meeting deadlines because several employees are vying for their own creative ideas to take center stage rather than listening to the ideas of others. This competitive atmosphere undermines the complex and interdependent nature of their work. Further, it is essential that the team learns how to work together efficiently because no one member of the team has all the knowledge and skills necessary to carry out an entire coordinated marketing campaign on their own. Management has decided to provide an incentive to help the marketing employees develop a sense of teamwork. Which type of performance-based pay would best help the marketing department?

Team-based bonuses, because they require employees to develop team-oriented behaviors and ensure that the whole team performs well in order to receive the bonus

A collaborative environment is one where ________.

Teams of employees work in concert to be creative, solve problems and produce results

The Principle of Inclusiveness states what?

That a pay range needs to be large enough to capture the pay range of all jobs in that grade or band

What was started as an early attempt to regulate how companies pay their employees?

The Fair Labor Standards Act

What does eligibility refer to?

The ability to participate in the system and certify each skill or competency

Allison recently graduated from college and was just offered a position as a food scientist at Fresh Munchables. The hiring director offered her a yearly salary of $48,000. However, Allison heard from a friend who graduated with her that he had been offered a yearly salary of $60,000 for a similar position at Tasty Tidbits, a competitor of Fresh Munchables in the snack industry. Allison then proposed a higher salary of $55,000 to the hiring director who refused and said that the typical compensation for an entry-level food scientist was actually $44,000. Allison turned down the job offer. Since then, Fresh Munchables has had a difficult time hiring and retaining food scientists due to higher salaries being offered at other companies. Which challenge is the company facing in terms of external reward positioning?

The bad data challenge, because the company does not have accurate data about the average level of compensation for similar jobs within the industry

The companies chosen should exemplify the product and service markets in which Fresh Munchables competes in order to provide a standard for the rewards system.

The HR department at Fresh Munchables has assigned a team to revise the company's compensation system to more accurately reflect the company's current strategic goals. The team has defined both the labor and service markets, and they are now ready to identify benchmark competitors. While selecting these benchmark competitors, what should the team keep in mind to provide an accurate standard for comparison?

The companies chosen should exemplify the product and service markets in which Fresh Munchables competes in order to provide a standard for the rewards system.

The HR department at Fresh Munchables has assigned a team to revise the company's compensation system to more accurately reflect the company's current strategic goals. The team has defined both the labor and service markets, and they are now ready to identify benchmark competitors.While selecting these benchmark competitors, what should the team keep in mind to provide an accurate standard for comparison?

The companies chosen should exemplify the products and service markets in which Fresh Munchables competes in order to provide a standard for the rewards system.

The executive team at Fresh Munchables wants the company to stand out from its competitors. The company doesn't have enough money to offer new employees higher rates or additional health benefits compared to other companies in the area, so the executive team has asked you for advice on attracting highly qualified employees. What advice can you give them?

The company should offer unique perks that will improve perception of the company's culture.

The compensation team at Fresh Munchables is weighing the option of implementing individual-based pay within the company's total rewards system. The individual-based pay would apply to select manufacturing employees. These employees would receive increased pay contingent on their competencies and experience.

The cost; individual-based pay can become expensive as employee performance increases

The cost; individual-based pay can become expensive as employee performance increases.

What is strategic management?

The definitions of criteria are all conceptually and empirically connected to employee, unit, and organizational outcomes

An internal rewards alignment is best defined as what?

The extent to which an organization's total rewards system aligns each employee's rewards with those received by others in the organization

After carefully considering different approaches for internal alignment at Fresh Munchables, the compensation team has officially decided to use a point factor approach. After choosing compensable factors, developing factor measures, and determining factor weights, you are now ready to pilot test the job evaluation system. This is an important step in which the compensation team can make sure that all parts of the system come together effectively. Another concern the team wants to address during this step is evaluating employee satisfaction with the new system. Fresh Munchables has not used a system like this before, and some employees have raised questions and concerns about it. Because one of the company's biggest goals with this change is to ensure employee satisfaction, what is an important element to keep in mind as you pilot test the system?

The extent to which the system produces relative job values that will ensure all employees get raises. The extent to which the system produces relative job values that make sense to each employee who views the results The extent to which the system produces relative job values that are better than the previously used system. The extent to which the system produces relative job values that make sense to the company's financial department.

What is a communication strategy?

The plan for sharing the compensation strategy with employees and receiving their ongoing feedback

The job value structure represents __________.

The structure of jobs internally positioned according to their relative value

For the past week, the compensation team at Fresh Munchables has been collecting market data and identifying benchmark jobs. They have collected data from three years ago from a number of different sources to establish external market pay rates.

The team must age the data in order to account for inflation.

The team should implement a pilot program to allow the organization to better understand the parameters.

After Fresh Munchables has finished creating a capability-based pay system, the compensation team must then implement it.While rolling out the new system, which of the following is advisable to ensure the success of the program?-The team should limit the amount of communication to ensure that competitors do not copy the organization's strategy.-The team should implement a pilot program to allow the organization to better understand the parameters.-The team should avoid including a sunset clause in order to allow the team to adapt the plan as needed after implementation.-The team should avoid implementing a pilot program because employees will feel excluded, which will lower morale.

The team should implement a pilot program to allow the organization to better understand the parameters.

Kit is an employee at Kormel Foods, a local competitor of Fresh Munchables. Kit has worked for his company for roughly 10 years and, for the most part, has been happy with his pay. Recently, however, Kit had a conversation with an old friend from high school who works in one of Fresh Munchables' manufacturing facilities but makes $10 more per hour for performing the exact same work. Apparently, Kit isn't the only Kormel employee being underpaid. How can management at Fresh Munchables leverage this information?

They can now reduce the wages of their manufacturing employees to match the competition. WRONG They can inform union officials that Kormel may be a good candidate for union formation. They can inform Kormel that Kormel's employees are unhappy with their pay. They can capitalize on the dissatisfaction of the Kormel employees and attract talented workers from Kormel.

The compensation team at Fresh Munchables is working on a capability-based pay system for the information technology unit. While developing a capability-based pay system, it is critically important to ensure that employee skills and competencies are tied directly to the desired performance outcome.

They must ensure that the measurement is transparent, meaning that employees who take the initiative to develop new skills receive capability-based pay raises. WRONG They must ensure that the measurement is strategic, meaning that the desired skills are tied to employee performance and are in line with company goals.

An area competitor of Fresh Munchables, Tio's Foods, has good, hardworking employees—many of whom could be valuable employees at Fresh Munchables. In fact, the executive team has been trying to poach Tio's employees for some time now. Tio's, in many ways, has neglected to take care of its employees, which could potentially lead to the formation of a union. If the compensation team at Fresh Munchables were to perform a SWOT analysis, this situation is likely considered to be a(n) ________.

Threat, because Fresh Munchables is now likely to experience union activity as well Strength, because Fresh Munchables can use this information to add value for its customers Opportunity, because Fresh Munchables can leverage the information to target desired talent Weakness, because Fresh Munchables must now consider whether it is also treating its employees poorly

Amanda is the chief human resources officer at Fresh Munchables and is working to improve the FMLA process. Due to various medical conditions, select employees at Fresh Munchables must regularly miss work in intermittent periods to meet with their physicians, receive treatments, and stay home when sick. Per the FMLA, all employees receive 12 weeks of time off to recuperate from medical conditions. For what reason would Amanda choose to require employees to use all forms of paid time off as part of these 12 weeks?

To simplify the complex task of administering the required 12 weeks of time off

The compensation team at Fresh Munchables has begun a review into the company's current compensation system. You have been assigned to conduct short interviews with mid-level and low-level employees to assess what type of compensation would be most attractive to them. Which other group in the organization should you interview in order to fulfill the purpose of the total compensation system?

Top management, because both the employer and employees need to be satisfied in order for the working relationship to continue.

Margaret, a new HR employee for Fresh Munchables, assumed there would be a very strict total rewards system with little deviation from employee to employee. She was comfortable with that assumption, because it would make her job easier. Now that she is on the compensation team, she is realizing that there needs to be more flexibility in implementing and executing a total rewards system because the environment is always changing. What argument is there to support her newfound realization about the total rewards system?

Total rewards almost always requires a degree of judgment in an environment of uncertainty.

What theory explains why people purchase lottery tickets?

Tournament theory

In the preliminary stages of developing the compensation system, the compensation team at Fresh Munchables assigns a member of the team to perform a SWOT analysis to better understand the organization's environment and how that may influence the compensation system. Which of the following outcomes may be discovered in the SWOT analysis for Fresh Munchables?

WRONG: Strategic compensation factors—such as overarching company goals to outperform competitors in the food and beverage industry—that will allow for a competitive advantage

As part of Fresh Munchables' new online marketplace venture, you have determined that 15 new jobs will be required to sell Fresh Munchables' products online and have arranged these jobs into three groups for internal alignment purposes: website development and support, processing, and shipping. What have you created in doing this, and why is it important in the process of determining compensation?

You have created a job-value structure to determine the relative value of each job within the company for comparison to similar jobs at competing companies.

A downside to the comparison approach is that it ________.

Becomes inefficient as the size of company grows

Reward surveys are __________.

Aggregations of reward information gathered from other market organizations

Reward surveys are ____________.

Aggregations of reward information gathered from other market organizations

Managers should remember that the process of ________ is important and also consider any legal ramifications of the historic pay disparity.

Change

The individual-based approach assumes that rewards should be based on what?

Characteristics of a person holding a job

In which approach would it appear that jobs are categorized by job descriptions?

Classification approach

What is a cost leadership strategy?

Having a lower-cost product or service at the highest priority throughout an organization's processes

Organizational performance includes all of the following EXCEPT ____________.

Having employee satisfaction

How much are workers paid for overtime work done under the Fair Labor Standards Act?

1.5 times the standard hourly rate

As a general rule, base pay strategies rarely lead the market by more than ________.

10%

FMLA allows up to ________ weeks of time off to recuperate from medical conditions or to handle qualified family needs.

12 weeks

Within the ACA, the employer mandate requires that organizations with ________ or more people either offer health insurance to their employees or pay an additional tax for not having done so.

50+more 100

A capability-based pay system because it provides a greater incentive for employees with the specific qualifications needed by the research and development unit.

Companies that use tips as a significant portion of compensation need to ensure that ___________.

A set rate plus tips amounts to more than the federal minimum wage

What is a compensable factor?

A statement of what the organization values

An organizational citizenship behavior is ________.

A value-creating activity engaged in by employees but not as part of the job

What is a reward survey?

Aggregations of reward information gathered from other market organizations

The purpose of human resource strategy is to ________ business strategy and CSFs.

Align

Amanda, Fresh Munchables' new compensation manager, is evaluating the company's current compensation system and is thinking about making large, but valuable, changes. Amanda knows she also needs to consider the effects of the changes on the people at the company. Which of the following people will be most affected by changes in the rewards system used at Fresh Munchables?

All individuals who work for the company at any level.

Which of the following involves work relationships?

All of the above

Indemnity plans __________.

Allow employees to go to any physician and create costs for the organization only when health services are utilized

The purpose of pay grades is to __________.

Allow jobs that create the same amount of value for the organization to be treated in the same way

In a job-based system, pay changes occur when ________.

An employee changes jobs

What does absolute level refer to?

Base salary

Which of the following is NOT an example of an intangible reward?

Base salary

Total rewards include ___________.

Base salary and benefits

The reinforcement theory says what?

Behavior follows consequences

Of the following, which most aligns with the strategy shift?

Being involved in business with a value-driven purpose

Through the use of ________, an organization can create a link between its reward structures and external markets.

Benchmark jobs

Managing total rewards is all about ensuring that the rewards offered by an organization meet whose needs?

Both the organization and the employee

Rucker plans have a ___________ base on metrics.

Broader

Strategic human resource management ensures that HR practices are aligned with ________ in general and critical success factors in particular.

Business Strategy

Strategic human resource management ensures that HR practices are aligned with ________ ________ in general and critical success factors in particular.

Business strategy

According to the text, what is one way that a compensation manager can effectively age data?

Calculate for inflation

The expectancy perception asks ___________.

Can I perform at the level required for the reward?

Which of the following is NOT considered an intangible reward?

Cash bonuses

________ refers to the direct monetary pay given to an employee in exchange for their contributions to the organization.

Cash compensation

Rucker plans provides incentives for _________.

Collaboration

Organizations use pay grades and ranges to monitor how well pay rates are conforming to the pay plan. What is frequently used to measure this conformity?

Compa-ratio

What restrictions do companies have in regards to their salaried employees?

Companies are not allowed to have both salaried and hourly employees.

In a dynamic, role-based job, __________.

Compensation plans need to facilitate change

Which of the following is NOT a readily available source of rewards information?

Competitors' compensation plans

After the departure of more than a few employees over the past six months, the management team at Fresh Munchables is concerned about employees' happiness and job satisfaction. The company has raised wages and found the best possible health care plan; yet, it still struggles to keep long-term employees .Which strategy can the management team use to figure out how to retain employees and increase employee satisfaction?

Conduct a survey asking employees what benefits they want in order to gain useful information about preferred compensation plans.

The primary outcome of SWOT analysis is to list out

Critical Success Factors

The primary outcome of SWOT analysis is to list out what?

Critical success factors

In the differentiation strategy, the costs of the organization will be passed on to the __________.

Customer

Differentiations in pay should only be made when they are clearly ________ and worth the potential tradeoffs.

Defensible

The manager of the engineering business unit at Fresh Munchables is working with HR to develop a variable pay program in the form of individual bonuses. The manager hopes that it will help employees focus on the goals of the unit to increase compliance with safety procedures and reduce the number of accidents in the workplace.How should the manager determine whether each employee should receive a bonus and how much the bonus should be in comparison with others?

Define the desired safety behaviors and deliver bonuses according to the extent to which each employee demonstrated those behaviors.

The engineering unit at Fresh Munchables is trying to attract and retain employees with a niche set of skills. The compensation team has spoken with the engineering manager and decided to create a capability-based pay system to attract qualified engineers. What should be the first step in creating this system?

Define the different levels of each desired skill in order to create an appropriate basis for skill measurement. WRONG Define the individual characteristics that will allow a person to be successful as an engineer in order to create value for the organization.

Which of the following is NOT a reason a corporation would want to incorporate individual-based pay into its total rewards system?

Demonstrates good faith in employees

The CEO of Fresh Munchables wants to enter the online marketplace and sell select snack products online. As a member of the HR department, you are given the task of creating new departments to manage Fresh Munchables' online business activities. Using a job-based approach, what do you need to do first before creating a pay structure for these new departments?

Determine how much each employee should be paid, because employees who are better qualified should be paid more Determine who will manage each department, because managers' salaries should be determined first Determine what new jobs will be created and managed, because compensation depends on what types of jobs are created Determine the value of each job, because employees who do their job better provide more value and should be paid more

The reward level strategy refers to what?

Determining the amount of reward offered at each level of a company

The value in having policies that slow the process of topping out include all of the following EXCEPT _______.

Developing the employees

The most fundamental question of internal reward alignment relates to the number of ________ in an organization.

Distinct reward structures

The valence perception asks _____________.

Do I value the reward?

Which of the following measurements is more successful than the others?

Each has its own unique strengths

Overlapping grades allow for ___________ career management as employees are promoted up through their own function or take a lateral position in a different function.

Easier

In order to design effective performance-based pay systems, managers must have a good understanding of ________.

Employee motivation

Linear careers are where ________.

Employees can expect to spend the duration of their careers with a single organization

__________ are said to be paid at red circle rates.

Employees whose pay is above market range

_________ are said to receive green circle rates.

Employees whose pay is below market range

Distributive justice is also known as what?

Equity theory

One way to define a job-specific reward level strategy could be what?

Establishing different reward level strategies for different job families or hierarchical levels

What ethical framework involves having the view that people ought to pursue their own self-interest and not the interests of others?

Ethical egoism framework

Which item can job evaluation, job analysis, market surveys, and performance measurement assist with?

Explanation

Of the following, which is NOT considered a fairness perception in total rewards?

Extreme

Which of the following is NOT a primary concern when integrating data from multiple rewards systems?

Fabricated third-party websites and self-reported information

Which of the following industries best demonstrates the cost leadership strategy?

Fast food

Organizations can establish ________, wherein organizations or employees put pretax funds into accounts from which employees can draw for medical expense reimbursement.

Flexible spending accounts

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

Gain sharing

The benefits benchmark survey is used to ___________.

Gauge the type and level of benefits offered by other companies

When jobs were grouped into ________, it was for the purpose of treating them the same for compensation purposes.

Grades and bands

What does a cost leadership strategy prioritize most?

Having a low-cost product or service

An employee's satisfaction with work is heavily influenced by ________.

Immediate supervisor

Having a panel ________ the reliability of the system as having multiple people viewing the performance creates a more accurate picture of the employee's behavior.

Increases

Labor markets are where ____________ are the sellers and ____________ are the buyers.

Individuals; organizations

Justice theory has three types of justice. Which of the following is NOT included?

Interchangeable

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

Internal reward alignment

What is an advantage to broadbanding?

It allows for greater flexibility.

Why is the list of benchmark competitors important?

It creates the standard to which the rewards system is anchored.

In which approach are jobs compared and then the "important" jobs get points and "win"?

Job comparison approach

In which approach would it appear that jobs are ordered based on rank and file?

Job comparison approach

In which approach are jobs compared and then the "important" jobs get points and "win"?

Job comparison approach Point factor approach Classification approach Hybrid approach

Through what method do you understand how valuable a job is?

Job evaluation

Without a variable pay component, ________ remain the same even when revenues, sales, or profits drop.

Labor costs

Lead the market in base pay but lag in variable compensation.

________ can have an important impact on employees and the meaning they perceive in work.

Leaders

What is the difference between a minimum wage and a living wage?

Living wages are determined locally, while minimum wages are enforced by the government.

Why might workforce reduction efforts to reduce costs in an organization tend to systematically terminate the employment of older workers?

Longer-tenured employees tend to be paid more than others.

Within the cost leadership strategy, a business will have a(n) ________ cost structure.

Lower

________ are one way to establish the price for any good or service.

Markets

What is the goal of comparable worth?

Men and women should be paid the same for comparable work

There are three measures of central tendency used to compare compensation. Which of the following is NOT one of those measures?

Mode

There are three measures of central tendency used to compare compensation. Which of the following is NOT one of those measures?

Mode

Pay compression is when ________.

New employees and long-tenured employees are paid very similar amounts

If customer perception is part of the business strategy, which of the following is NOT aligned with the strategy?

Not making a good impression on the customer

What is an outlier?

Numbers that are far above or below most of the other numbers

What is employer matching?

Organizations make contributions to the retirement account contingent on the employee also electing to contribute to it.

The mean can be heavily influenced by

Outliers

The "employer mandate" is a part of which act?

Patient Protection and Affordable Care Act

Job evaluation provides the basis for developing a network or configuration of ________ that make up a rewards structure.

Pay rates

Employees having quality relationships with their coworkers and creating a climate of acceptance is an example of _________.

Peer relationships

Where interactions and relationships with customers are ________, the employee will receive ________ intangible rewards.

Positive; positive

________ are designed to distribute a portion of the firm's annual profits back to the firm's employees.

Profit-sharing plans

It is best to have a ________ approach in job analysis.

Quantitative

Of the following, which most aligns with the person-organization fit stye?

Recruiting for talent as well as match to the organization

Spot awards draw upon ________ in that they allow for very short gaps between the demonstrated performance and the reception of the reward.

Reinforcement theory

The more a rewards system deviates from "the way we do things around here," the more likely it is to be _________.

Rejected

As a compensation manager, what will you NOT do?

Require the organization to implement a market-standardized compensation plan

Generally speaking, eligibility should be ________ to ensure that the number of employees certifying is in line with current and future needs for that capability.

Restricted

Differences in national cultures should be considered when rewards systems are designed because employees from diverse cultures may have very different definitions of what?

Rewards

Reward form combination strategy refers to _________.

Rewards (cash, benefits, bonuses) and how they relate to each other

What is variable pay?

Rewards that are dependent on a team

A ________ takes HR out of the role of policing excuses for absences and places responsibility for managing the days off on the employee.

Rights-based framework

Which of the following would NOT be included as an intangible reward?

Salary

Shara, a new employee at Fresh Munchables, is asking for paid time off to take care of her aging father, who has a life expectancy of six months. Shara has been with the company two months and has worked a total of 120 hours. The Family and Medical Leave Act (FMLA) has been designed to meet employees' needs in times such as this, and you, as an HR professional, want to follow its requirements. In accordance with the requirements of the FMLA, your company has a large staff surpassing 50 employees, but what is another requirement for Shara?

She must have worked 1,250 hours for the organization in the preceding year.

A typical job performance model for a food preparation worker at Fresh Munchables states that high performance includes the following How could a manager improve this job performance model?

Specify the direct causes of high performance, such as knowledge, rewards, and employee characteristics, to show how employees can achieve high performance

A typical job performance model for a food preparation worker at Fresh Munchables states that high performance includes the following: 1. Using proper cooking methods to prepare and package appealing and nutritious food 2. Checking food during preparation and using proper food handling procedures to ensure that quality and safety standards are met 3. Producing accurate quantities of each product with little to no wasteHow could a manager improve this job performance model?

Specify the direct causes of high performance, such as knowledge, rewards, and employee characteristics, to show how employees can achieve high performance

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

Spot award system

________ provide employees the right to purchase a set amount of shares of stock for a set price.

Stock options

What does SWOT stand for?

Strengths, Weaknesses, Opportunities, Threats

Team-based bonuses, because they require employees to develop team-oriented behaviors and ensure that the whole team performs well in order to receive the bonus.

Allison recently graduated from college and was just offered a position as a food scientist at Fresh Munchables. The hiring director offered her a yearly salary of $48,000. However, Allison heard from a friend who graduated with her that he had been offered a yearly salary of $60,000 for a similar position at Tasty Tidbits, a competitor of Fresh Munchables in the snack industry. Allison then proposed a higher salary of $55,000 to the hiring director who refused and said that the typical compensation for an entry-level food scientist was actually $44,000. Allison turned down the job offer. Since then, Fresh Munchables has had a difficult time hiring and retaining food scientists due to higher salaries being offered at other companies.Which challenge is the company facing in terms of external reward positioning?

The bad data challenge, because the company does not have accurate data about the average level of compensation for similar jobs within the industry

What does rewards strategy coherence refer to?

The extent to which the parts of the strategy fit together in a logical and clear way

What is organizational culture fit?

The extent to which the rewards strategy aligns with and supports the ingrained practices, norms, and values of the organization

Dispersion represents _________.

The gap between two data points

A psychological contract refers to __________.

The informal expectations and agreements between an employee and an organization

The job-based approach assumes that organizations will reward employees based on what?

The job a person holds

Before compensating an employee as if they are exempt from minimum wage and overtime provisions, each employee's job should be analyzed to ensure what?

The job qualifies under the duties test of the executive, administrative, professional, sales, or highly compensated employees, 2) the employee is salaried, and 3) salary is at least the minimum level

The regression analysis can also be called what?

The line of best fit

What is the median?

The middle number

The benefit mix strategy refers to ___________.

The particular combination of benefit types that an organization offers

The HR department at Fresh Munchables is considering a point factor approach for establishing internal alignment. The company is mid-sized but is growing steadily, and it is projected to become a large organization within the next 10 years. What is true about the point factor approach that would benefit Fresh Munchables?

The point factor approach provides a method for calculating points for each job based upon the job's value to the organization, which is easily scalable for use in a large company.

Terri, an employee in the marketing department, comes into the HR office upset because she believes that she is not being paid fairly. Terri is a good employee, and you don't want her to leave the office feeling upset. As an HR representative, you fear that if you don't resolve her frustration, she might leave the company. During your conversation, it will be important for you to focus on ________.

The process that led to the decision regarding her pay, emphasizing procedural justice

The process that led to the decision regarding her pay, emphasizing procedural justice.

Employee performance best represents ________.

The quality and quantity of the work that individual employees produce in the organization

What is organizational culture?

The shared beliefs, values, norms, and assumptions of the organization

The job value structure represents

The structure of jobs internally positioned according to their relative value

After a hugely successful marketing campaign, demand for Fresh Munchables' products has increased rapidly. More demand means more manufacturing and more employees. The company needs to hire many new employees—and quickly.

The value of each job is flexible; diverse people with varying skill sets can apply for any position.

The Principle of Overlap states what?

There should be overlap in the pay ranges for successive pay grades or bands.

A drawback to designing your own survey___________

Time

Which of the following is NOT a purpose principle?

Transformational management

Communication at Fresh Munchables has traditionally been all over the place. Both misinformation and a lack of information among all levels of employees have created many avoidable problems over the years. While developing the new compensation system for Fresh Munchables, what kind of communication strategy should the compensation team incorporate, and why?

Two-directional, because it enables the sharing and receiving of important information between the organization and employees.

Which of the following is NOT a primary concern when integrating data from multiple rewards surveys?

Understanding government mandates

What ethical framework involves making a decision that creates the greatest good for the greatest number of people?

Utilitarian-based framework

What are pay form-specific reward strategies?

Varying pay level strategies across reward types

A pay-form-specific rewards strategy means __________.

Varying pay level strategy across reward types

Total rewards plays a(n) ________ role in the business strategy.

Vital

When employees have a(n) ___________ in the design of the compensation system, they are more likely to see the system as procedurally fair.

Voice

What is the most obvious downside to a capability-based pay?

Wages and salaries paid to employees will rise.

In ________ organizational cultures, more individuality is shown through the organization's rules being less strictly applied.

Weak

Understanding threats can help ask the question

What societal flaws can hurt the organization?

Understanding threats can help organizations ask which particular question?

What societal flaws can hurt the organization?

What is capability-based pay?

When a reward system explicitly attempts to vary rewards based upon the capabilities of the employee

Angelina is a self-proclaimed "health nut" and animal activist. She recently was hired at Fresh Munchables, a food and beverage company offering vegan on-the-go snacks, as their marketing manager. Angelina could not be happier about her new position because it aligns with her values. What does the HR manager who hired Angelina know about the purpose principle?

When the employee's values align with the business's core purpose, the employee will value their relationship with the business more.

Understanding opportunities can help ask the question

Where can we improve?

Understanding opportunities can help organizations ask which particular question?

Where can we improve?

What is a graphic rating scale?

Where raters rate the extent to which the job involves the compensable factor

Job-value structure does NOT help to answer what question?

Who should be recruited for jobs?

With the increased use of laser-based vision correction, about ________ of vision plans cover that procedure.

one-quarter

The research and development business unit at Fresh Munchables is currently recruiting several more employees to develop a new line of superfood meal replacement smoothies. Among the new recruits, the unit will need employees who are registered nutritionists and can formulate smoothies that contain all the nutrients needed to serve as a full meal.In considering what type of rewards system to implement for the new employees, which of the following systems will best attract employees who have the skills needed to help the new product line succeed?

A capability-based pay system because it provides a greater incentive for employees with the specific qualifications needed by the research and development unit

The Employment Retirement Income Security Act was established to ________.

regulate the retirement plans offered by organizations.

Cost-sharing is when ________.

the insurance pays for only a portion of medical expenses.

the process that led to the decision regarding her pay, emphasizing procedural justice

The purpose principle states that _____________.

Employees derive intangible rewards from an organization's value-consistent purpose.

Which of the following is true under the Consolidated Omnibus Budget Reconciliation Act (COBRA)?

Employees have a right to continue their employer-sponsored health care plan, at the employee's expense, for up to 18 months.

__________ are said to receive green circle rates.

Employees whose pay is below the range for their job

Choose the answer that does NOT complete the blank: Internal reward alignment is how ________ the relative value of all jobs in an organization is.

Enjoyable

The shipping division at one of Fresh Munchables' facilities has been struggling with both absenteeism and high regrettable turnover. The facilities manager at this location is not sure what to do. What steps can HR take to address this concern?

Ensure that wages in the unit are just and fair; the perception of justice plays an important role in absenteeism and turnover.

The executive team at Fresh Munchables has just updated the company's mission statement based on responses to a recent employee survey asking questions about the company's vision, values, and purpose. By aligning the company values with that of its employees, what can the company's executives expect to see?

Improvement in employee satisfaction and motivation, because aligning employee and company values creates a sense of purpose in an organization.

Interactional justice refers to what?

Perceptions of the extent to which the employee was treated with due respect

The executive team at Fresh Munchables would like to include retirement benefits in their compensation model. They understand that proper retirement planning is becoming increasingly vital based on concerns surrounding social security. After looking at various alternatives, they have decided to provide their employees with select retirement benefits. The benefits plan they choose to implement must (1) be cost-effective and (2) not require the company to set aside its own money to fund it. Based on this information, which type of plan will best meet their strategy needs?

A defined benefit plan: a formula to calculate how much pension an employee has earned and how much the organization will pay the employee throughout retirement WRONG

Unlike other healthy food producers in the local market that sell low-quality and cheap products, Fresh Munchables wants to provide premium food products at a high cost. In fact, Fresh Munchables has become known in its community for placing a high priority on always providing great food and superior customer service. In order to continue to facilitate Fresh Munchables' goals and reputation, what competitive strategy should HR implement?

A differentiation strategy, because this approach justifies spending more money to stand out from competitors.

An outside consultant, because an external contact will provide less biased information The finance department, because if the company is successful and profitable, more employees can be hired Top management, because both the employer and employees need to be satisfied in order for the working relationship to continue More mid-level and low-level employees, because if the employees' needs are not met, they will likely leave the company

The performance management system refers to all of the following EXCEPT __________.

Analyzing trends in the market

Animal activists have a higher moral purpose than those who disregard animal rights. OR When the employee's values align with the business's core purpose, the employee will need fewer rewards.

Organizations get work done through ___________.

People

Broadbanding allows employees to do all of the following EXCEPT

Be promotable within a given time period

Broadbanding allows employees to do all of the following EXCEPT _________.

Be promotable within a given time period

Differentiation strategy is the strategy of ________.

Being different

Team performance ________.

Comprises the collective actions of groups of employees

What are competencies?

Configurations of knowledge, skills, and traits that enable employee performance

What are the ethical frameworks discussed in this topic?

Ethical egoism, carism, rights-based, utilitarianism, justice-based

The law of unintended consequences is part of which theory?

Expectancy theory

HIPAA stands for________?

Health Insurance Portability and Accountability Act

________ specify an exercise price that is above the current market price to take into account that the organization expects the employees to outperform expected market returns.

Incentive stock options

________ are defined as all psychological, social, and contextual factors in organizations outside the traditional pay and employee benefits categories that are rewarding to employees.

Intangible rewards

Sulli is currently an HR manager at Fresh Munchables. The director of HR has tasked Sulli with making the paid leave system more streamlined. The company is currently offering various forms of paid leave, including vacation time, holidays, sick days, and personal days .What is the best way for Sulli to produce her director's desired outcome?

Lump the various forms of paid leave into a paid time off bank.

The supply chain management unit at Fresh Munchables is creating an entirely new international purchasing team solely focused on purchasing food ingredients, machinery, and supplies from companies abroad. The compensation team must determine how to pay this new team. The compensation for the new jobs must account for the shifting budgetary allowances involved in the creation of the new team. It should also motivate employees to do their best work. Which form of pay should you choose to use in order to address these needs?

Performance-based pay, because it is flexible and controls costs within the company Seniority-based pay because it encourages employees to stay at the company WRONG Achievement-based pay, because it motivates employees to compete with one another Hourly-based pay, because it is the standard for purchasing positions and will help control costs

Performance-based pay, because it provides an incentive for the team members to produce the desired result of growing the company's client base. WRONG

Draymond is a machine operator who recently quit his job at Fresh Munchables. He would often arrive at work only to find that, due to unexpected mechanical issues, he would be unable to do his job and would be sent home (over an hour's drive away) without pay. Other factory workers have complained for similar reasons. Fresh Munchables wants to improve employee satisfaction and prevent such situations from occuring in the future. What is the best compensation-related action to take to achieve these goals?

Provide increased overtime pay for hourly employees.

José, a compensation specialist at Fresh Munchables, just created a new pay-for-performance bonus initiative in the business operations unit. If the business operations unit hits the desired performance metric, employees in this unit will receive an annual bonus in relation to their pay grade. Which is the most effective way to track whether this incentive plan is producing the desired outcome?

Require units to fill out surveys to determine if they are meeting their unit goals. Monitor all performance metrics in the company by collecting and tracking data. Monitor the performance metric detailed in the plan by collecting and tracking data. Require employees to fill out surveys to determine if they are meeting their personal goals.

Strength, because Fresh Munchables can use this information to add value for its customers

What is unemployment compensation?

Temporary income for employees who have lost employment

The extent to which the system produces relative job values that will ensure all employees get raises.

Total compensation can be calculated as __________.

Total Compensation = Salary + Variable + Benefits

As an HR professional, you understand that compensation and total rewards is a complicated topic. At Fresh Munchables, there have been many cases over the years in which employees have shared strong feelings and harsh words with HR when they felt that their pay was unfair. In light of the company's past dealings with employees concerning compensation, which of the following is important for you to understand as you revise the total compensation system?

Wages and rewards shape how employees both feel and perform.

Understanding weaknesses can help ask the question

What can we not do?

In what situation could an employee's wages be garnished?

When an employee is dealing with paying a debt or child support

Scanlon plans focus on ________.

improvements in labor costs

Through transformational leadership, employees can receive greater ________ from their membership in the organization.

intangible rewards

The point factor approach does all of the following EXCEPT __________.

Develops revolutionary ideas for job analysis

Of the following, which is NOT considered a guide to fairness in total rewards?

Extreme

What happens when jobs are static?

Jobs don't change much over time.

Since its inception, Fresh Munchables has given its various managers free reign to manage the total rewards of their respective departments. Recently, however, the HR manager has received complaints from employees in multiple departments complaining that they are not being paid equally. What kind of total rewards approach has Fresh Munchables likely taken that has led to this problem?

A broad approach, because the company gave managers free reign over a broad range of rewards A centralized approach, because the same problems are faced by multiple departments A decentralized approach, because rewards are determined by immediate supervisors A hybrid approach, because supervisors determined the rewards but the rewards were centralized in each department

Chris and Becky are the managers of two respective Fresh Munchables restaurants that recently opened in Wichita, Kansas, and Oklahoma City, Oklahoma. Chris is currently trying to come up with a business strategy that best prepares his location to stay competitive within the Wichita health food marketplace. Becky is trying to decide if she is compensating her employees fairly in her own location. Chris is trying to make ________, while Becky is trying to make ________.

A fairness equity decision; a comparative decision An internal equity decision; an external equity decision A comparative equity decision; a fairness equity decision An external equity decision; an internal equity decision

What is a benchmark job?

A sample of jobs that is representative of the type, content, and level of jobs in the organization

Fringe benefits have become quite ________ to compensation plans.

Central

As the compensation team at Fresh Munchables develops a new compensation strategy, they begin to consider the impact it will have on company culture. The current culture values high-quality products and high performance from employees but doesn't necessarily emphasize teamwork or openness. When it comes to organizational culture fit, which of the following would be the best practice at Fresh Munchables?

Consider the cultural elements of quality and employee performance within the total rewards design, because a dramatic paradigm shift will increase the chance of rejection by employees. Integrate norms from companies like Google and SASS, because they apply to most organizations across the board and have proven successful in increasing employee satisfaction. Build a compensation system that deviates from the emphasis on product quality, because it will help the company reach new strategic goals of decreasing costs and increasing productivity. Introduce new cultural norms of teamwork and openness, because this will improve how well a compensation system that includes team-based pay will be received.

Product and service markets are where organizations compete to ________ through the production of products or the provision of services for customers in exchange for money and loyalty.

Create value

Determine how much each employee should be paid, because employees who are better qualified should be paid more Determine the value of each job, because employees who do their job better provide more value and should be paid more Determine who will manage each department, because managers' salaries should be determined first Determine what new jobs will be created and managed, because compensation depends on what types of jobs are created

Cash compensation influences ________.

Employee perception

_____________ are said to receive red circle rates.

Employees whose pay is above the range for their job

To have an effective rewards system, you will NOT need to understand what?

Employees' previous salary

Cash compensation is monetary pay from ________ to ________.

Employers; employees

Choose the answer that does NOT complete the blank:Internal reward alignment is how ________ the relative value of all jobs in an organization is.

Enjoyable

Exempt employees usually work fewer hours and are paid lower wages than nonexempt employees. Exempt employees work longer hours but are paid the same as nonexempt employees. Exempt employees are paid more than nonexempt employees but are not required to work overtime, unlike nonexempt employees. Exempt employees work flexible hours and are not paid overtime, unlike nonexempt employees.

What is the purpose of central tendency?

Find one single number that best represents a whole group of numbers

Using job analysis, all work in business is organized into __________.

Jobs

A dynamic-based role would describe which of the following situations?

The work that employees do changes on a regular basis.

The ________ allocates points to jobs based upon the job's value to the organization.

Point factor approach

What does cost leadership focus most on?

Price

What kind of analysis is best to use when finding out how much a job family should be paid?

Regression analysis

The performance-based approach assumes that rewards should be based on what?

Results by an employee

Which of the following is NOT a function of Human Resources?

Risk management

What is a business strategy?

The collection of decisions, approaches, and activities that allow an organization to compete and win

The Principle of Parity suggests what?

The more grades that are used, the smaller the ranges will be.

The principle of parity suggests what?

The more grades that are used, the smaller the ranges will be.

Once jobs are broadly organized into a job structure, the next step is to create a mechanism for assigning their relative value in ________.

The organization

What is human resource strategy?

The policies, practices, and systems that manage the interface between the organization and its employees in order to enable long-term organizational performance

What is base pay?

The salary or hourly wage in exchange for the employee's contribution to the organization

The principle of control states what?

The size of pay ranges should be kept sufficiently small to enable an organization to control labor costs.

What is the goal of job evaluation?

To create a way to measure the value of each job in the organization

What is the total rewards content strategy?

Type, level, and combination of rewards offered

Which of the following is NOT a historically used structured pay grade?

Upward mobility

WRONG The value of each job is flexible; diverse people with varying skill sets can apply for any position. The value of each job is fixed; all employees are paid the same regardless of their qualifications. The value of each job is flexible; managers, not HR, determine how much each employee is paid. The value of each job is fixed; all employees will always be paid the same amount.

Understanding weaknesses can help organizations ask what question?

What can we not do?

What is a niche-focused strategy?

When an organization chooses a small and segmented market and competes only in that small arena

In an individualistic environment, ________.

Work is done independently by single employees reporting to a single supervisor

The value-reward line can best be explained by which mathematical equation?

y = mx + b

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HRM/324T: Total Compensation

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