Q&A Hero

Q: Studies indicate that employee assistance programs help reduce absenteeism among employees with family problems and illnesses.

Q: The firm for which Rob works offers employees counseling services, a credit union, and a physical fitness facility, which are all considered personal service benefits.

Q: When employers offer domestic partner benefits to employees, it means that employees' same-sex domestic partners are eligible to receive the same benefits as do the husband, wife, or legal dependent of one of the firm's employees.

Q: Why do some companies use employee leasing firms? A) Large companies experience shifts in employee demand. B) Small businesses are able to obtain affordable health insurance. C) Businesses save on health care costs by hiring independent contractors. D) Companies reduce unemployment insurance premiums by outsourcing.

Q: Kim works a 4-day workweek that consists of 10-hour days. Kim's employer most likely offers ________. A) job sharing B) flextime schedules C) telecommuting options D) compressed workweeks

Q: Furman, an automotive parts manufacturer, employs nearly 800 workers in its Dallas, Texas facility. Furman has always offered its employees health and dental insurance as well as legally required benefits such as unemployment insurance and workers' compensation. Furman's top executives are considering the idea of offering employees a flexible benefits plan. Which of the following, if true, best supports the argument that Furman should offer employees a flexible benefits plan? A) Some Furman employees express interest in vision insurance, while other workers never enroll for dental insurance. B) Furman outsources its employee benefits program, and employees must file claims with the plan's administrator. C) Some Furman employees prefer to build their work days around a core of midday hours rather than work from 9 to 5. D) Furman established a pooled paid leave bank to reduce the number of employee absences.

Q: The primary purpose of ________ is to enable employees to balance work and family obligations. A) automated benefits systems B) work-life benefits C) cafeteria plans D) pooled paid leave banks

Q: Which of the following provides services such as financial counseling, child care referrals, and adoption assistance? A) long-term pension plan B) work-life benefit service C) benefit management system D) employee assistance program

Q: Why do some employers encourage early retirement? What are some potential problems associated with early retirement programs? How can firms avoid such problems?

Q: In a brief essay, describe the three classifications that apply to basic pension plans.

Q: With graded vesting, the period for acquiring a non-forfeitable right in employer matching contributions is 3 years.

Q: Which term refers to the money that an employer and employee have placed in the employee's pension fund that cannot be forfeited for any reason? A) thrift plans B) vested funds C) stock options D) cash balance funds

Q: Which of the following is considered a hybrid of defined benefit and defined contribution plans? A) ESOP B) 401(k) plan C) flexible savings D) cash balance plan

Q: What is the main problem associated with defined benefits plans? A) lack of employer matching B) lack of portability C) highly regulated D) highly taxed

Q: A 401(k) plan is best described as a ________. A) defined contribution pension plan B) defined benefit pension plan C) health savings account D) golden parachute

Q: Portability makes it easier for employees who leave a firm prior to retirement to ________. A) switch to defined contribution pension plans B) take their pension funds with them C) designate a new pension beneficiary D) invest their pensions in 401(k) plans

Q: All of the following are Social Security benefits EXCEPT ________. A) death benefits B) disability payments C) retirement benefits D) defined contribution benefits

Q: Craig was born in 1961. According to the Social Security Act, what is Craig's full retirement age? A) 62 B) 65 C) 67 D) 70

Q: Jenny's pension plan encourages her to contribute at least 5% of her annual salary in addition to the set amount that her company contributes. She is given choices regarding how the money is invested. When she retires, the amount she has available will depend on how much she invested herself, and the rate of return on the investments she chose. This pension plan would be classified as ________. A) qualified, defined benefit B) non-contributory, defined benefit C) contributory, defined contribution D) contributory, defined benefit

Q: Malcolm is interviewing for a new job and he is evaluating the quality of the pension plans offered for each company he is considering. One company offers a pension plan in which the company will make all contributions to the plan and will base his pension benefit on a formula linked to his pay at the time of retirement and the number of years he works for the firm. This pension plan could be classified as a ________. A) non-contributory, defined contribution B) contributory, defined benefit C) non-contributory, defined benefit D) contributory, qualified plan

Q: Why is controlling workers' compensation costs important? How can costs be controlled by employers?

Q: Employees frequently use sick leave to take care of family problems and personal issues. How can firms address this costly problem?

Q: Why do employers provide severance pay to employees? What should firms consider when designing a severance plan?

Q: Portability makes it easy for employees who leave one firm to work for another firm to take their accumulated pension funds with them.

Q: A primary benefit of 401(k) plans is that payments made by employees into the plan are pre-tax, so the employee pays no tax on those dollars until after he or she retires or withdraws the money.

Q: The Comprehensive Omnibus Budget Reconciliation Act requires the government to provide health insurance to terminated or retired employees and their families through the Medicare system.

Q: The American Disabilities Act makes it illegal for employers to discriminate against women by providing benefits of a lower amount or duration for pregnancy, childbirth, or related medical conditions.

Q: Women affected by pregnancy and childbirth are eligible for the same benefits as disabled employees.

Q: If an employee is injured at work due to a blatant disregard for company safety policies, the company is not required to pay workers' compensation.

Q: Pooled paid leave plans combine sick leave, vacation, and personal days into a single leave pool and have been blamed for increasing employee absenteeism.

Q: Supplemental pay benefits provide employees with time off with pay for jury duty, vacations, funerals, and military responsibilities.

Q: Legally required benefits, such as unemployment insurance, are more costly to employers than health insurance.

Q: Employee benefits account for about over one-half of wages and salaries.

Q: According to surveys, what will most employers do in response to the Patient Protection and Affordable Care Act? A) decrease the time allowed for family leave B) decrease workers' compensation benefits C) increase employee contributions for dependents D) increase sponsorships of retiree medical coverage

Q: Which condition must be met for an injured employee to receive workers' compensation benefits? A) The injury occurred during an overtime or nighttime shift. B) The employee was wearing adequate protection. C) The injury was not the fault of the employee. D) The employee was injured while on the job.

Q: Which group contributes to workers' compensation funds? A) employers B) state governments C) federal government D) insurance providers

Q: Athena, a sales representative, was terminated from her position at Ross Manufacturing. On Athena's last day of work, she was given a check for $5,000. What did Athena most likely receive from Ross Manufacturing? A) disability pay B) annual bonus C) severance pay D) unemployment insurance

Q: Which of the following is NOT a true statement about the Family and Medical Leave Act? A) The law applies to all public and private employers regardless of size. B) Eligible employees have worked for the employer for at least one year. C) Leave may be taken for personal illness or the birth of a child. D) Eligible employees must be granted up to 12 weeks of leave.

Q: A manager can best control the cost of unemployment insurance by ________. A) eliminating supplemental pay benefits for part-time employees B) documenting the poor performance of dismissed employees C) establishing a pooled paid leave plan for workers D) investigating all workers' compensation claims

Q: What is the primary cause of rising unemployment tax rates? A) outsourced workers B) unsafe workplaces C) executive perquisites D) economic recessions

Q: Which of the following is a discretionary benefit? A) unemployment insurance B) disability insurance C) FMLA leaves D) Social Security

Q: An employer's unemployment tax rate depends on the employer's ________. A) total payroll costs B) policy on retirements C) supplemental pay benefits D) rate of employee terminations

Q: Health insurance, life insurance, pensions, and child care assistance are best categorized as ________. A) compensation B) incentives C) benefits D) rewards

Q: According to the Comprehensive Omnibus Budget Reconciliation Act, how long are most employers required to make health benefits available to terminated or retired employees? A) 6 months B) 12 months C) 18 months D) 24 months

Q: ________ are groups of health care providers that contract with employers, insurance companies, or third-party payers to provide medical care services at a reduced fee. A) PPOs B) HMOs C) DMOs D) Hospitals

Q: Elizabeth works at an auto firm, which recently shut down for five weeks to change machinery. However, during the shutdown, Elizabeth was able to maintain her standard of living because of the firm's ________. A) supplemental unemployment benefits B) workers' compensation insurance C) supplemental health benefits D) disability insurance

Q: Eric has worked full-time for a large manufacturing company for over 3 years. Eric and his wife have recently adopted a baby, and Eric wants to take time off from work to care for the child. Which of the following laws most likely applies to Eric's situation? A) Pregnancy Discrimination Act B) Family and Medical Leave Act C) Title VII of the Civil Rights Act D) Newborn Mother's Protection Act

Q: Keith works as a construction foreman, and he is viewed as a reliable, competent employee. Keith was recently injured in a car accident while on vacation, and his injuries are so severe that he will not be able to return to work. Which of the following would most likely provide Keith with benefits? A) supplemental unemployment benefits B) workers' compensation insurance C) unemployment insurance D) group life insurance

Q: Which of the following terms refers to benefits for time not worked such as unemployment insurance, vacation and holiday pay, and sick pay? A) supplemental pay benefits B) employee assistance C) financial incentives D) merit pay

Q: Which of the following benefits is required by federal or state law? A) disability insurance B) workers' compensation C) paid time off D) pensions

Q: The indirect financial and nonfinancial payments employees receive for continuing employment with the company are called ________. A) reimbursement B) employee compensation C) salary D) benefits

Q: What is a stock option? What are some of the problems associated with rewarding managers with stock options?

Q: What are the advantages of employee stock ownership plans?

Q: Gainsharing plans involve putting some portion of an employee's weekly pay at risk for the opportunity to earn incentives if the employee meets or exceeds his or her goals.

Q: Which of the following is the LEAST relevant characteristic of an effective incentive plan? A) Incentives are based on industry standards. B) Rewards are attractive to targeted employees. C) Incentives are linked to effort and performance. D) Goals are specific, achievable, and challenging.

Q: Upon being hired as a marketing representative at Argo Pharmaceuticals, Shelly agreed to forego 5% of her normal pay if she failed to meet performance goals. In return, Shelly will receive a 10% bonus if she exceeds her goals. In what type of plan does Shelly most likely participate? A) earnings-at-risk pay plan B) variable risk sharing plan C) at-risk gainsharing plan D) risk-reward stock plan

Q: Enterprise incentive management software is used by managers to ________. A) motivate employees to meet and exceed departmental goals B) quantify correlations between pay and performance C) select and develop mission-critical employees D) monitor training and development needs

Q: Broad-based stock option plans are intended to ________. A) motivate all employees at a firm B) encourage management retention C) monitor the decisions of executives D) distribute earnings to boards of directors

Q: An earnings-at-risk pay plan bases employee pay and bonuses on ________. A) maximizing organizational performance B) generating additional long-term sales C) engaging in strategic objectives D) achieving departmental goals

Q: Which gainsharing plan involves employees working on a guaranteed piecework basis? A) current profit-sharing B) deferred profit-sharing C) Lincoln incentive system D) earnings-at-risk pay plan

Q: All of the following are examples of organization-wide incentive plans EXCEPT ________. A) employee stock ownership plans B) gainsharing plans C) golden parachute D) profit sharing

Q: What is the most likely reason that firms are implementing group incentive plans? A) stricter regulations regarding team bonus plans B) heavy reliance on teams to manage work C) expected loss of older workers D) rising cost of health benefits

Q: Which of the following involves setting a production standard for a specific work group and then paying incentives to the group members if they exceed the standard? A) team incentive plan B) group profit-sharing plan C) employee stock ownership plan D) organization-wide incentive plan

Q: Which term refers to payments a firm makes related to changes in company ownership? A) pension plan B) annual bonus C) golden parachute D) retirement perks

Q: An executive who receives a ________ stock receives units instead of shares of company stock. The units will be equated to cash in the future if appreciation occurs. A) phantom B) restricted C) premium D) nonqualified

Q: Marie, a top manager at Levon Marketing, will receive 500 shares of the firm's stock if the firm's sales increase by 5% in the next quarter. Which of the following was Marie most likely given? A) phantom stock B) stock appreciation rights C) restricted stock plan D) performance-contingent restricted stock

Q: Which of the following would most likely be used by a firm that wants to retain the services of a top manager for a specified period of time? A) restricted stock plan B) golden parachute plan C) stock appreciation rights D) performance-contingent restricted stock

Q: Which term refers to the right to purchase a stated number of shares of a company stock at today's price at some time in the future? A) stock option B) gainsharing plan C) multiplier method D) at-risk variable plan

Q: All of the following are factors that influence an annual bonus EXCEPT ________. A) eligibility B) commission C) size of the fund D) individual performance

Q: According to research, most firms use ________ to motivate the short-term performance of managers. A) work-life benefits B) annual bonuses C) variable pay D) training

Q: The Sarbanes-Oxley Act was most likely enacted to ________. A) provide financial insight B) decrease the corporate tax rate C) monitor the distribution of stock shares D) increase the accountability of top executives

Q: What should be the central focus of a firm's executive reward packages? A) employing top-quality management experts B) accomplishing the firm's strategic goals C) ensuring ethical and legal accountability D) encouraging long-term accountability

Q: What is the main benefit of paying salespeople a combination of salary and commission? A) limiting the firm's risk of overly high commissions B) aligning employee goals and company strategy C) providing simple salary administration D) clearly linking pay with performance

Q: What is a disadvantage of straight commission plans? A) Payments are complicated to calculate. B) Salespeople spend too much time on servicing. C) Salespeople neglect selling hard-to-sell products. D) The company's fixed sales costs are proportionately high.

Q: What is the primary disadvantage of using the straight salary approach to pay salespeople? A) relying on annual profits B) discouraging staff loyalty C) preventing territory changes D) failing to link effort with reward

Q: A straight salary for salespeople is most appropriate when the main tasks involve ________. A) selling technical products B) exceeding sales quotas C) finding new clients D) selling real estate

Q: A(n) ________ plan is an incentive plan that engages many or all employees in a common effort to achieve a company's productivity objectives with any resulting cost-savings shared among employees and the company. A) stock gain plan B) merit pay plan C) gainsharing D) ESOP

Q: Which incentive plan is based on a philosophy that managers and employees must cooperate together? A) cash plan B) gainsharing plan C) deferred profit-sharing plan D) employee stock ownership plan

Q: Most gainsharing plans include all of the following features EXCEPT ________. A) a philosophy of cooperation B) a focus on individual achievement C) sharing of benefits formula D) an involvement system

Q: Which of the following is the primary benefit of employee stock ownership plans? A) Employees have voting rights in firm decisions. B) Firms pay distribution taxes for employees prior to retirement. C) Firms may borrow against employee stock held in trust. D) Employees are able to diversify their investments.