Management compensaton
What law protects an employee from termination due to wage garnishment for one debt? a) CCPA b) FMLA c) FLSA d) HIPPA
A) CCPA
Which of the following employer-paid benefits would an employee receive tax-free? a) 1500 for taking a computer class at the community college b) 500 award for a labor-saving program c) ten days of sick leave at 100% of original salary d) two weeks of paid vacation
a) 1500 for taking a computer class at the community college. The only way to provide a benefit tax-free is for the IRC to specify it. Examples tend strongly to promote social policy, such as the value of education. Therefore, even if you do not know where the IRC lists it, you can guess that the educational benefit in this list is the right answer. Benefits with tax breaks may also include health insurance, life insurance, disability insurance, childcare expenses, certain moving expenses, and certain business expenses.
Under the FLSA, how long must an employer keep payroll records, at minimum? a) 3 years b) 4 years c) 2 year d) 1 year
a) 3 years
A retirement plan that allows employees of a for-profit company to reduce their regular pay and contribute a portion of it toward retirement on a tax-deferred basis is most likely based on which of the following Internal Revenue Code sections? a) 401(k) b) 125 c) 403(b) d) 457
a) 401(k)
What is the range spread for a job with a minimum salary of $60,000 and a maximum of $90,000? a) 50 b) 33 c) 15 d) 67
a) 50
Which of the following acts requires organizations holding federal construction contracts to pay laborers and mechanics the prevailing wage of the employees in the locality where the work is performed? a) Davis- Bacon Act b) FLSA c) Copeland Act d) Walsh- Healey Act
a) Davis-Bacon Act
Which of the following protects employees covered by private retirement programs? a) ERISA b) Tax Equity and Fiscal Responsibility Act c) ADEA d) Tax Reform Act
a) ERISA
Which of the following is an amendment to US wage and hour laws prohibiting unequal pay between men and women for at least "substantially equal" work? a) Equal Pay Act b) Sarbanes-Oxley Act c) Protal-to-Portal Act d) Sherman Antitrust Act
a) Equal Pay Act
The IRS 20-factor test is useful for determining whether a worker is a) an employee or an independent contractor b) exempt or nonexempt under the FLSA c) a supervisor or employee for union membership purposes d) subject to tax withholdings or not
a) an employee or independent contractor
Which of the following is NOT a pay differential? a) base pay b) shift pay c) hazard pay b) overtime
a) base pay
In developing a compensation program, the establishment of separate pay policies by one employer... a) can be set for key jobs in the same business unit b) is illegal under the Equal Pay Act of 1963 c) may only be established if they are at a higher level than the rest of the organization d) may only be implemented on a temporary basis due to special labor market conditions
a) can be set for key jobs in the same business unit
Which of the following provisions is TRUE under the 1996 Employee Commuting Flexibility Act? a) commuting time is not paid work time regardless of whether the employee is using a company vehicle or not b) commuting time is always paid work time regardless of whether the employee is using a company vehicle or not c) commuting time is not paid work time if the employee uses a company vehicle but is if the employee is not using a company vehicle d) commuting time is paid work time only if the employee uses a company vehicle.
a) commuting time is not paid work time regardless of whether the employee uses a company vehicle or not.
Cash profit-sharing plans are generally viewed as incentives for employees to... a) do what they believe will improve the firm's performance b) remain employed with the firm for their full career c) outperform others in their work unit d) focus on developing as many skills as they can
a) do what they believe will improve the firm's performance
An advantage of a stock-based (equity-based) compensation plan is that it a) encourages participants to think more like owners b) has no cost; the equity market creates the value c) is preferred by participants over equivalent amounts of cash d) provides certain income participants
a) encourages participants to think more like owners
Which of the following job evaluation methods uses compensable factors and external job market benchmarks? a) factor comparison b) job classification c) point factor d) ranking
a) factor comparison
One aspect of job redesign that is LEAST likely to improve employee motivation to do high-quality work is more... a) involvement in completing a unit of output b) autonomy over how the job is done c) variety in the skills used to complete a job d) financial incentives to increasing output
a) financial incentives to increasing output Focus on quality versus quantity in this question. Monetary incentives make people do more, but necessarily better. The other choices in this question (skill variety, involvement, and autonomy) are aspects of job design that we use specifically to increase the motivation to do a good job, as opposed to the much simpler matter of doing more work.
Which of the following pay approaches complements the team management concept? a) gainsharing b) piece rate c) merit pay d) job classification pay ranges
a) gainsharing
Which of the following would be the BEST choice of a group incentive plan if the employer wished to improve organizational productivity through shared management and employee efforts a) gainsharing b)ESPP c) profit sharing d) ESOP
a) gainsharing
Which of the following issues is NOT a consideration when determining equal work under the Equal Pay Act? a) gender b) responsibility c) skills d) effort
a) gender
ESOPs, ESPPs, and profit sharing are all examples of a) group incentives b) sales bonus options c) gainsharing strategies d) deferred compensation
a) group incentives Employee stock ownership plan (ESOP) = giving employees fractional ownership in a private company (not one that is publicly traded on the stock market). Employee stock purchase plan (ESPP) = giving employees a discount on the purchase of company stock (for a publicly traded company). Profit sharing = calculating quarterly profit and giving employees a bonus based on what it is.
Which of the following health plans allows an employee to roll over unused account balances from year to year? a) health reimbursement accounts b) full cafeteria plans c) premium-only plans d) flexible spending accounts
a) health reimbursement accounts
An HR manager reviews widely published salary data to ensure that company compensation is superior to regional competition. A potential outcome of this lead compensation philosophy is: a) improved ability to attract and retain scarce-skill employees b)increased need for pay openness in the organization c)fewer categories of nonexempt employees who will qualify for paid overtime d)less likelihood of securing federal contracts
a) improved ability to attract and retain scarce-skill employees
The rewards for work come in many shapes and sizes. For example, an employee may simply experience great satisfaction for finishing a challenging project. Which of the following BEST describes this type of reward? a) intrinsic reward b) compensatory reward c) total reward d) extrinsic reward
a) intrinsic award
A job requires at least two years of project management experience and a bachelor's degree in business, MIS, or the equivalent. These are examples of: a) job specification b) job enrichment c) competencies d) essential job functions
a) job specification
Which of the following philosophies would an entitlement-oriented organization embrace? a) lifelong employment b) individual rewards c) bringing in new talent d) performance-driven pay
a) lifelong employment
The BEST method of controlling indirect compensation is to... a) manage benefit costs b) evenly distribute overhead to all departments c) decrease overtime d) eliminate cost-of-living adjustments
a) manage benefit costs
Which of the following is NOT an example of a voluntary benefit? a) medicare b) sick pay c) qualified pension plans d) vision insurance
a) medicare
The major provisions of the FLSA are those concerned with... a) the minimum wage rates, overtime payments and child labor b) minimum wage rates, overtime payments, and fair employment practices c) minimum wage rates, overtime payments, and unfair labor practices d) overtime payments, fair employment practices, and child labor
a) minimum wage rates, overtime payments, and child labor
An entitlement culture is appropriate for a business that needs what type of workforce? a) one that continues to show productivity increases over time b) one that is highly competitive in completing daily assignments c) one that has a skill set that's in high demand d) one that has a line of sign to retirement
a) one that continues to show productivity increases over time An entitlement culture is one that rewards longevity. In certain kinds of work, productivity simply improves based on how long people have been on the job, so an entitlement culture makes sense, to encourage the most senior employees to stay.
The FLSA addresses all of the following provisions EXCEPT: a) paid time off b) minimum age of workers c) minimum wage d) overtime
a) paid time off
Which of the following statements is MOST true about rater bias? a) performance feedback bias is similar to interview bias b) rater bias exists in all exchanges of performance feedback c) rater bias is illegal d) rater bias nullifies the positive outcomes of providing meaningful performance feedback
a) performance feedback bias is similar to interview bias
At his job, Martin earns more by actually producing more. Which of the following compensation schemes BEST fits this model? a) piece-rate plan b) green-circle plan c) standard hour plan d) flat-rate plan
a) piece rate plan
At his job, Martin earns more by actually producing more. Which of the following compensation schemes BEST fits this model? a) piece-rate plan b) flat-rate plan c) standard hour plan d) green-circle plan
a) piece-rate plan
Fiduciary responsibilities under ERISA include all of the following EXCEPT: a) providing employees with comparative data on other plans b) disclosing complete and accurate information c) advising beneficiaries of circumstances that will affect the benefit d) making decisions solely in the interest of the participants and beneficiaries
a) providing employes with comparative
Which of the following job evaluation methods would provide a small organization with a quick and inexpensive way to compare one job to another? a) ranking b) paired comparison c) factor comparison d) point-factor
a) ranking
An employee's pay rate has been frozen from future merit increases because it is higher than the upper limit of the pay band. This is an example of a) red circle rate b) green circle rate c) black circle rate d) yellow circle rate
a) red circle rate
Which of the following is a productivity measure? a) revenue per employee b) cost per hire c) turnover and retention d) job satisfaction
a) revenue per employee
Under the Equal Pay Act, which of the following is NOT a consideration when determining whether two jobs are essentially equal? a) seniority b) effort c) skills d) working conditions
a) seniority
The Equal Pay Act (EPA) requires men and women to be paid the same for performing substantially the same work, according to which of the following four dimensions? a) skill, effort, responsibility, working conditions b) quality and/or quantity of work produced, effort responsibility, working conditions c)skill, effort, seniority, working conditions d) performance appraisal results, effort, skill, responsibility
a) skill, effort, responsibility, working conditions
Which of the following statements regarding payroll is correct? a) Social Security taxes are matched and withheld by the employer up to a yearly amount b) Medicare taxes are matched and withheld by the employer up to a yearly amount c) employers must retain paper copies of their payroll records d) voluntary deductions are withheld from employee paychecks before involuntary deductions
a) social security taxes are matched and withheld by the employer up to a yearly amount.
The choice of a compensation structure is BEST determined by... a) the organizational culture b) federal and state pay regulations c) the stage in the organization's lifecycle d) competitor pay practices
a) the organizational culture Think in terms of fit. Which of these must the compensation structure fit? Only the culture makes sense. The regulatory choice doesn't count, because it just sets a floor.
The concept of internal equity in compensation refers to... a) the relative worth of individual jobs in an organization b) the relationship between pay and productivity c) how pay structure relates to the marketplace d) the relationship between salary and benefits
a) the relative worth of individual jobs in an organization
Which of the following economic factors is the MOST important determinant affecting pay for a specific job? a) the supply and demand for the skills required for the job b) the unemployment rate in the local labor market c) the knowledge required to perform the job d) the profitability of the hiring firm
a) the supply and demand for the skills required for the job.
Which of the following is an example of direct compensation? a) vacation pay b) 401(k) matches c) employer Social Security contributions d) variable pay
a) variable pay
Which of the following measures uses number of incumbents and salary? a) weighted average b) unweighted average c) mode d) median
a) weighted average
Mary is 15 years old and works part-time in a veterinary clinic. In her case, which of the following would be an FLSA violation? a) working 20 hours a week while school is in session b) working outside of school hours while school is in session c) working up to 6 hours a day while school is not in session d) working up to 32 hours a week while school is not in session
a) working 20 hours a week while school is in session
The HR group gathered salary data but was unable to analyze it until the following year. Are the data still usable? a) yes, if the HR group adjusts the data for wage inflation b) yes if the jobs studied are still comparable c) no, salary data over six months old are unusable d) yes, if the HR group levels the data
a) yes, if the HR group adjusts the data for wage inflation.
An employee is currently making $10/hour. The minimum of the employee's pay grade is $5 and the maximum is $15. What is the compa-ratio? a) 10 b) 1 c) 0 d) 5
b) 1 The compa-ratio ("comparative ratio") compares a wage or salary against the market average. In this example, only the pay band is available for comparison, so we assume that the midpoint of this pay band is the same as the market average for the job. This is the only possibility, given how extreme the other choices are.
Jim is a regular hourly worker with a full-time job at a manufacturing plant in the United States. Last week, he worked 48 hours in all. Under this condition, what is the least amount that Jim's employer must pay him for that week? a) 348 b) 377 c) 290 d) 319
b) 377 The Fair Labor Standards Act (FLSA, 1938) lays out the basic conditions of work, including the national minimum wage, overtime pay for work beyond 40 hours a week, and restrictions on the permissibility of child labor. As of mid-2009, the federal minimum wage has been $7.25 an hour, so this is the minimum hourly rate permissible. Since 7.25 × 48 = 348, you should already know that the answer will be larger than this, because the 8 additional hours pay time and a half.
Your company has received a court order to garnish an employee's wages by $150 a month for a debt. The employee has no current garnishments and earns $300 a week, excluding tips, after all legally required deductions. What is the weekly amount to which your company must consent? a) $150 b) $75 c) $150 d) $50 e) $200
b) 75 The Consumer Credit Protection Act (CCPA, 1968) covers truth in lending, fairness in lending, and restrictions on wage garnishment. The last of these refers to a third party's removal of some portion of a worker's pay to cover a debt, by going directly to the employer under a court order that shows the worker to be a legitimate debtor to that party. The CCPA restricts garnishments to a maximum of 25% of a worker's "disposable earnings" (i.e., all pay after required taxes and state retirement contributions)—not including tips). It also prohibits employers from terminating anyone just because a garnishment order is in place for one debt. An employer may nevertheless terminate someone for having more than one of these on file. Note: This only applies to "debts." Child support and alimony have much higher limits.
The motivation theory that suggests that people are motivated by the reward that they anticipate receiving by accomplishing something, against the effort necessary to achieve it, is a) McClelland's acquired needs theory b) Vroom's expectancy theory c) McGregor's Theory X and Theory Y d) Adam's equity theory
b) Vroom's expectancy theory
Which of the following may NOT be included in a Qualified Domestic Relations Order (QDRO)? a) the number of payments or the period of payments are required b) additional benefit options requested by the alternate payee c) the name and address of the participant and each alternate payee d) percentage of the participant's benefits to be paid to each alternate payee
b) additional benefit options requested by the alternate payee
The Health Insurance Portability and Accountability Act (HIPAA)... a) requests mental health benefits to be the same level as medical benefits b) allows continued health insurance coverage for people who change jobs c) allows exclusion of pre-existing conditions for pregnancies d) extends insurance coverage to the unemployed
b) allows continued health insurance coverage for people who change jobs
The HR director at a large multinational corporation decided to extend the open-enrollment period for benefits, to accommodate her spouse, who needed a different plan. This constitutes a)unethical conduct b) breach of fiduciary responsibility c) exercising a choice-of-law clause d) breaking the law
b) breach of fiduciary responsibility Fiduciary responsibility = financial-legal responsibility = the highest standards of care and professionalism when dealing with financial matters in a legal context. As an agent of legal compliance, the HR manager must avoid even the appearance of commingling personal aims with professional duty.
Based on an analysis of the industry and labor market trends, a VP of human resources has determined that the best course of action for her company is to change from a narrow to a broadband salary structure. The current structure has been in place for more than 15 years, and the VP is anticipating strong resistance to making the change. Which of the following tools should the VP use to convince the executive team to make the change? a) calculate the cost-benefit analysis b) build a business case c) calculate the return on investment d) conduct a SWOT analysis
b) build a business case A business case lays out the desired result of a program, presents alternative solutions, describes possible risks from both implementation and nonimplementation, and defines the criteria used to measure success.
An individual who wants to save money for a child's private high school tuition would most likely make contributions to which of the following accounts? a) SIMPLE b) coverdell ESA c) Roth IRA d) 529 plan
b) coverdell ESA
Salaries, payroll taxes, and benefits are all a part of a) creating a compensation strategy b) creating an HR budget c) conducting a business impact measure d) analyzing the cost of recruiting
b) creating an HR budget The HR budget includes all employment costs.
As part of conducting a benefit plan needs assessment, the HR professional has looked at the organization's business strategy and compensation philosophy. What is the NEXT step that should be taken? a) look at market conditions to see what benefits competitors offer b) determine employee needs with regard to benefits c) conduct a utilization review to determine how benefits are used d) look at market conditions to see what benefits competitors offer e) determine which benefits should be included in the plan
b) determine employee needs with regard to benefit
James is a highly productive salesperson who is required to share a team bonus with his coworkers if certain sales goals are met each month. He is frustrated with this compensation structure, because he believes his teammates do not contribute as much as he does to the final numbers. This is an example of a) procedural justice b)distributive justice c) wage inequity d)pay disparity
b) distributive justice
In a self-audit of your employee's I-9 forms, several errors were found. These errors included incomplete sections, questionable documents accepted for verification, and over-documentation. Of the following corrective and prevention strategies, which of the following is the BEST single recommendation to your employer? a) requesting updated documents from affected employees b) enrollment in E-Verify c) training for employees d) recertification of all I-9 forms
b) enrollment in E-Verify
Which of the following BEST describes the theory of comparable worth? a) equal pay through job evaluation b) equal pay for work of equal value c) equal pay for equal market value d) equal pay for equal work
b) equal pay for work of equal value
What is a major advantage of internal equity in an organization? a) it guarantees that all employees have the same benefits b) it allows organizations to recognize unique jobs fairly c) it is a sure way to eliminate gender bias d) it lowers the amount the organization spends on salaries
b) it allows organizations to recognize unique jobs farily
Task identity, task significance, and feedback are all examples of what? a) key productivity indicators b) job enrichment c) job enlargement d) performance appraisal criteria
b) job enrichment Hackman and Oldham's "core job characteristics" include: (a) skill variety; (b) task identity; (c) task significant; (d) autonomy; and (e) feedback from the job. Managing these criteria in job design "enriches" the job, meaning that it become more capable of generating motivation in the employee to perform well.
The middle value when values are arranged in order from high to low is which of the following? a) mode b) median c) mean d) moving average
b) median
VEVRAA requires which of the following? a) federal contractors must list most job openings with state employment agencies b) private employers must list most job openings with state employment agencies c) federal contractors must list all job openings with state employment agencies d) private employers must list all job openings with state employment agencies
b) private employers must list most job openings with state employment agencies The Vietnam Era Veterans Readjustment Assistance Act (1974) requires federal contractors to list all jobs with state employment agencies, except for three types: (a) those lasting no more than three days; (b) those belonging to senior management; and (c) those that the employer is filling internally.
A correlation coefficient is an example of a type of a) learning matrix b) quantitative analysis c) job evaluation d) qualitative analysis
b) quantitative analysis
Within a traditional salary structure, what serves as the linkage to market pay rates? a) average compa-ratios for the salary range b) salary range midpoints c) average new hire salaries for the last year d) average simple weighted medians for the salary range
b) salary range midpoints When you do a wage-and-salary survey, you get an average salary (across several companies) for whatever job you're examining. That average salary belongs to an average person, because the survey covered all sorts of people, including low-paid newcomers and highly paid old-timers. After adopting some version of that salary to create your own salary bracket, you will pay your newcomers less than that point and your experienced people more. The salary midpoint that you use is therefore your link to the labor market.
Early retirement incentive plans are discriminatory when they are offered to employees based on age and... a) individual compensation levels b) seniority c) specific job titles d) department needs
b) seniority
The ability of an employee to use multiple skill sets on the job represents which of the following job enrichment activities? a) task identity b) skill variety c) task variety d) job rotation
b) skill variety
Which of the following statements about person-based pay systems is true? a) they pay higher performers more aggressively b) they pay employees for what they are capable of doing, not for what they currently do c) they work best in companies with a few professional employees e) they pay more to employees with long service
b) they pay employees for what they are capable of doing, not for what they currently do Pay based purely on KSAs makes it unnecessary to measure productivity at the individual level. It makes sense to do this when the labor market gets very tight—job mobility becomes very easy. It was therefore popular in the 1990s, during extremely low unemployment.
Which of the following methods of quantitative analysis would be most effective for an organization with data that are out of date? a) simple linear regression b) weighted average c) trend analysis d) mode
b) weighted average
What is the compa-ratio for an employee who earns $15 per hour where the salary range has a midpoint of $12 per hour? a) .03 b) .80 c) 1.25 d) 1.35
c) 1.25
Certain acts of Congress offer tax credits to employers for hiring certain categories of workers. Which of the following IS NOT such a provision? a) Tax and trade relief extension act b) Welfare-to-work tax credit c) American opportunity tax credit d) Work opportunity Tax Credit
c) American opportunity tax credit All of these provide tax credits to employers except the American Opportunity Tax Credit (2009), which instead provides tax credits to individual taxpayers (for certain educational expenditures).
Which of the following would be considered indirect compensation? a) granting comp time to a salaried employee for extra hours worked at a convention b) paying individual bonuses to team members for meeting critical project deadlines c) awarding store gift cards to top performers in a sales contest d) paying the difference between jury duty pay and the employee's regular wages
c) awarding store gift cards to top performers in a sales contest If it is direct compensation, the employee can spend it by payday or sooner. Everything else is indirect compensation.
The marketing director needs to hire a replacement for the marketing coordinator , who is being promoted. The position has changed quite a bit since the last time the job was advertised, and the director is looking to HR to assist in redefining the job requirements so the recruiting process can begin. Which of the following would NOT be used in determining the job requirements? a) job description b) job competencies c) job specification d) candidate profile
c) candidate profile
Which of the following would be considered direct compensation? a) deferred pay b) perquisites c) cash bonus d) unpaid leave
c) cash bonus
Two consecutive years of mandated 10% increases in the minimum wage would probably result in which of the following? a) reduced leverage of employees making one to two times the minimum wage in asking for larger pay increases b) less pressure on the available pool of discretionary funds for pay increases for most employers who have minimum-wage employees c) compression between the lowest-paid workers and more skilled workers for a retail trade employer d) increased pressure for larger pay increases among employees making one to two times the minimum wage
c) compression between the lowest-paid workers and more skilled workers for a retail trade employer An increase in the minimum wage pushes the lowest-paid job in a company up, in line with the external benchmark. To maintain internal equity, wages for other internal jobs also rise a bit, so there can still be differences in pay where necessary. However, pay for all internal jobs cannot rise by the same percentage, or the company will go bankrupt. Therefore, the biggest increases are at the bottom, and the smallest ones are at the top. The net effect is the compression of wage differences across job levels.
Which of the following job classes would typically have the greatest range spread? a) supervisor b) customer service c) executive d) production
c) executive
In negotiating with the union, you have agreed to discuss shift-differential pay. How would the NLRB construe this? a) it is a permissive bargaining topic b) it is an illegal bargaining topic c) it is a mandatory bargaining topic d) it is a ULP
c) it is a mandatory bargaining topic (Hint: When two choices are simple opposites, the answer is usually one of them.) This refers to labor-management relations (i.e., how an employer must get along with a union, if the employees have opted to certify one to represent them). The National Labor Relations Board (NLRB), a unit of the Department of Labor, oversees all laws pertaining to labor-management relations. Of the terms and conditions of work over which management and the union might negotiate, some are "mandatory," some are "permissive," and some are "illegal." Now, by "mandatory," we do not mean that you just have to discuss it during the collective-bargaining process whether you like it or not; rather, we mean that you cannot make a unilateral decision about it. Mandatory topics in collective bargaining include pretty much everything having to do with compensation.
Which of the following job evaluation methods does the paired-comparison method belong to? a) point factor b) job classification c) ranking d) factor comparison
c) ranking
An employee's weekly paycheck is short eight hours. The HR manager checks the timecard and verifies the error. Which of the following actions should be taken under FLSA? a) a check should be cut for the additional amount by the end of the same day b) a check should be cut by the payroll department before the next payday c) the amount should be added into the next paycheck d) the employee should be paid out of petty cash
c) the amount should be added into the next paycheck First, the FLSA has a "safe harbor" provision, or "window of correction," that lets employers fix mistakes like this. It does not say how quickly to do it. Therefore, it is reasonable to do it as quickly as possible. However, it is bad HR practice to work around existing processes (because of the potential for error or abuse when we do this). Therefore, we correct the error as closely in alignment with existing processes as possible. In this case, that means using the normal system of employee pay calculations and paycheck processing.
Barney, your shipping clerk, arrives early to work and must wait for the workday to start before he can do anything. In this case, which of the following is true under the Portal-to-Portal Act? a) the time that Barney was waiting is considered hours worked b) the Portal-to-Portal Act is irrelevant to this question c) the time that Barney was waiting is not considered hours worked d) the answer depends on whether Barney intended to work or not.
c) the time that Barney was waiting is not considered hours worked The Portal-to-Portal Act (1947) is an amendment to the Fair Labor Standards Act (1938), which came in response to questions concerning whether the commute to work is compensable as hours worked. In agreement with the principle that an employee only enters the employer's jurisdiction of control upon arrival at the worksite, the act excludes the commute to and from work as part of the compensable workday. A commute between worksites, however, is indeed compensable.
Which of the following statements about flat-rate systems is true? a) they are the most cost-effective approach b) they are used most often for professional jobs c) They are used most often for bargaining unit jobs d) they are used most often in privately held organizations
c) they are used most often for bargaining unit jobs. In a flat-rate wage system, everyone who holds the same job receives the same pay, regardless of seniority or performance. There are no pay bands.
FICA requires employers to do which of the following? a) contribute to a defined- benefit plan b) contribute to a deferred- compensation plan c) with hold Social Security tax from pay d) provide health insurance for all employees
c) with hold Social Security tax from pay
What is the range spread for a job with a minimum salary of $60,000 and a maximum of $90,000? a) 50% b) 15% c) 33% d) 67%
d) 67% Range spread is a percentage indicator of salary range. It lets you express a salary and range by reference to the midpoint and percentage alone, and set appropriate differences in range spread by level of responsibility (higher levels have higher spreads). To calculate this, divide the larger number by the smaller number, and subtract one.
what should be the compensation basis for a sales representative whose time is spent acquainting potential customers with the company's product line and providing technical assistance? a) commission b) volume (sales) incentive c) sales of new products d) base salary that represents a large percentage of compensation
d) base salary that represents a large percentage of compensation
Which of the following terms refers to collapsing multiple pay grades into one pay grade that has a wide range? a) green circle rate b) golden parachute c) red circle rate d) broad-banding
d) broad- banding
An ESOP uses the company's tax deductible contribution to... a) pay dividends to the employees b) pay special bonuses to employees c) invest the funds in expanding the organization d) buy capital stock in the company
d) buy capital stock in the company. Think of an employee stock ownership plan (ESOP) as a separate organization (which it technically is). The company pays it money, and the ESOP buys a certain percentage of that same company's stock with it, on behalf of the employees. The employees thus own stock in their own company (even if it hasn't gone public). The ESOP keeps it safe, calculates its growing value for each employee, and makes payouts when justified (e.g., when employees retire).
The correlation coefficient is useful for a) compensating for data that may be out of date b) describing standards of quality c) determining which variables are outside acceptable ranges d) determining whether one variable affects another
d) determining whether one variable affects another
A process for reducing the impact of bias during performance reviews by using multiple raters is known as what? a) a rating scale b) an MBO review c) paired comparison d) inter-rater reliability
d) inter-rater reliability
Why is job analysis important? a) it allows for proper training and development of key personnel b) it provides the supervisory responsibilities necessary to accomplish organizational goals c) it ensures compliance with EEO laws d) it provides the foundation from which all other HR activities are designed
d) it provides the foundation from which all other HR activities are designed Job analysis is arguably the centerpiece of all HR practices
An employee earning $22,500 per year supervises three employees and spends 35 hours per week on essential job duties that require discretion and independent judgment. Which of the following describes this employee? a) nonexempt, based on the percentage of essential job duties b) exempt, based on the administrative exemption test c) exempt, based on the executive exemption test d) nonexempt, based on the salary basis test
d) nonexempt, based on the salary basis test Based on the FLSA amendment that came into effect in 2004, FLSA-exempt positions require salaries of at least $455 per week. Multiply $455 by 52 weeks to get the annual salary.
COBRA requires that continuing insurance be offered to eligible participants by a) all private sector employees b) all employers with two or more employees c) public sector and church employers with 20 or more employees d) private sector employers with 20 or more employees
d) private sector employers with 20 or more employees
Which of the following would be considered a nonmonetary extrinsic reward? a) a 10 percent salary increase b) a feeling of accomplishment after completing a tough assignment c) challenging work on a new project d) recognition by the CEO at a company meeting
d) recognition by the CEO at a company meeting
Workers' compensation benefits must be provided: a) only in cases where employees followed the organizations safety and health rules b) for off-the-job injuries c) only to workers in the construction and other heavy work industries d) regardless of fault in an accident
d) regardless of fault in an accident Workers' compensation is a type of no-fault insurance, meaning literally that it is unnecessary to establish culpability as a condition for paying out. In essence, it is a contract between employees and the employer, by which the employee will receive a defined payout for a qualifying injury, as long as it occurred in the course of one's scheduled work. In fact, despite this no-fault provision, payouts typically follow a lengthy investigation to confirm that the employee was indeed working at the time of the event.
Which of the following options illustrates a combination of both extrinsic and intrinsic rewards? a) promotion and corporate title b) corporate title and salary increase c) salary increase and promotion d) salary increase and learning a new skill
d) salary increase and learning a new skill
Which compensation system guarantees an employee a base wage and then pays an additional amount for each unit produced over the minimum? a) differential piece-rate system b) production bonus system c) commission system d) straight piece-rate system
d) straight piece-rate system (Hint: When two choices have identical wording but differ on one detail, the answer will usually be one of them.) A straight piece-rate system only has one piece-rate (i.e., just one dollar amount linked to each unit of output), but the minimum wage first creates a floor beneath that, hence the base wage. Naturally, a differential piece-rate system also has that floor. It differs only in that it includes more than one piece-rate (i.e., the dollar value for each unit of output goes up after the employee has produced a defined number of units).
Which of the following is a basic principle behind job analysis? a) the required qualifications should include everything the manager would like an employee to have b) the analysis is limited to task inventories and questionnaires c) the analysis focuses on the person doing the job, not the job itself d) the analysis focuses on the job, not the person
d) the analysis focuses on the job, not the person
The concept of internal equity in compensation refers to... a) the relationship between pay and productivity b) how pay structure relates to the marketplace c) the relationship between salary and benefits d) the relative worth of individual jobs in an organization
d) the relative worth of individual jobs in an organization
Which of the following economic factors is the MOST important determinant affecting pay for a specific job? a) the unemployment rate in the local labor market b) the knowledge required to perform the job c) the profitability of the hiring firm d) the supply and demand for the skills required for the job
d) the supply and demand for the skills required for the job
