Q&A Hero

Q: Plans in which a corporation contributes shares of its own stock to a trust established to purchase shares of the firm's stocks for employees are known as ________. A) cash plans B) Jefferson incentive systems C) deferred profit-sharing plans D) employee stock ownership plans

Q: Tanner's employer puts a predetermined portion of profits into a trust account for Tanner's retirement. Which of the following is most likely the type of profit-sharing plan used by Tanner's employer? A) Jefferson incentive system B) deferred profit-sharing plan C) gainsharing plan D) cash plan

Q: What type of profit-sharing plan involves the firm simply distributing a percentage of profits as profit shares to employees at regular intervals? A) current profit-sharing B) Lincoln incentive system C) Jefferson incentive system D) employee stock ownership plan

Q: During difficult economic times, employers have to cut costs. What are some strategies for minimizing the costs associated with employee health care? What no-cost or low-cost methods are available to employers who want to recognize and reward hard-working employees?

Q: You are the CEO of Blue Bay Motor Boat Company, a mid-size firm that manufactures speed boats. What incentive plan would you implement for the firm's engineers? What incentive plan would you implement for the firm's managers? What benefits are you required by law to provide? What types of discretionary benefits would you make available to all employees?

Q: Merit raises typically become part of an employee's base salary.

Q: According to research, which of the following has a significant impact on employee engagement? A) performance reviews B) variable pay plans C) job design D) awards

Q: An employer would most likely use an enterprise incentive management system to ________. A) calculate overtime pay B) automate award programs C) monitor employee engagement D) track performance appraisals

Q: Every month, Angela, a manager at a manufacturing facility, meets briefly with each of her subordinates and shows them a graph of their productivity on the assembly line. Which term best describes Angela's activity? A) exit interview B) social recognition C) performance feedback D) performance appraisal

Q: Angelo, a process engineer with Global Semiconductor, is following a technical path rather than a management path at the firm. Which of the following has most likely been implemented by Global Semiconductor? A) dual-career ladder B) competency-based pay C) flexible family benefits D) social recognition program

Q: Tyrone, a data entry clerk, is paid a basic hourly rate. He receives an extra percentage of his rate when his productivity is above normal. Which incentive plan is most likely used by Tyrone's employer? A) standard merit pay B) standard hour plan C) straight piecework D) variable pay

Q: Which term refers to an incentive plan in which a person is paid a sum for each item sold, with a strict proportionality between results and rewards regardless of output? A) standard merit pay B) straight hourly pay C) straight piecework D) variable pay

Q: Workers at a t-shirt shop are paid a sum for each t-shirt they produce. Which incentive plan is most likely used by the employer? A) merit pay B) piecework C) standard hour D) variable pay

Q: Which term refers to any plan that ties pay to productivity or profitability? A) piecework B) variable pay C) merit pay D) overtime pay

Q: Ryobi is a large, international power tool manufacturer that develops affordable, high-quality products such as drills, circular saws, and routers for both homeowners and craftspeople. As the company continues to grow, its top executives want to ensure that employees are appropriately paid for their performance and that financial incentives are both fair and effective. Currently, the firm provides merit raises based on performance appraisals; however, executives are considering changing the current incentive plan. Which of the following questions is most relevant to the decision by Ryobi executives to discontinue all merit raises? A) What are the guidelines for implementing a gainsharing plan? B) What types of merit raises are effective for high-performing managers? C) What organization-wide incentive plans are used by other manufacturing firms? D) What is the connection between merit pay increases and employee productivity?

Q: Ryobi is a large, international power tool manufacturer that develops affordable, high-quality products such as drills, circular saws, and routers for both homeowners and craftspeople. As the company continues to grow, its top executives want to ensure that employees are appropriately paid for their performance and that financial incentives are both fair and effective. Currently, the firm provides merit raises based on performance appraisals; however, executives are considering changing the current incentive plan. Which of the following, if true, undermines the argument that Ryobi should discontinue all merit raises? A) Ryobi managers have noticed significant productivity improvements among employees who receive merit raises. B) Ryobi managers have not received significant training about conducting performance appraisals. C) Ryobi's top competitor is considered a high-performance work system within the industry. D) Ryobi employees have expressed that they would prefer stock options to merit raises.

Q: Ryobi is a large, international power tool manufacturer that develops affordable, high-quality products such as drills, circular saws, and routers for both homeowners and craftspeople. As the company continues to grow, its top executives want to ensure that employees are appropriately paid for their performance and that financial incentives are both fair and effective. Currently, the firm provides merit raises based on performance appraisals; however, executives are considering changing the current incentive plan. Which of the following, if true, best supports the argument that Ryobi should eliminate all merit raises? A) Ryobi uses an enterprise incentive management system to automate compensation. B) Motivation among Ryobi engineers has been improved through social recognition programs. C) Performance appraisals at Ryobi occur annually, and standards vary from manager to manager. D) The commission percentage for Ryobi sales people is based on the ability to meet monthly quotas.

Q: How does merit pay differ from a bonus? A) Merit pay becomes part of an employee's base pay, but a bonus does not. B) A bonus becomes part of an employee's base pay, but merit pay does not. C) Merit pay is linked to individual performance, while a bonus is linked to profits. D) A bonus is linked to individual performance, while merit pay is linked to profits.

Q: Which of the following terms refers to any salary increase the firm awards to an individual employee based on his or her individual performance? A) merit pay B) variable pay C) competency-based pay D) incentive pay

Q: Which of the following is the most commonly used tool for motivating employees? A) merchandise incentives B) recognition programs C) special events D) variable pay

Q: Supplemental executive retirement plans and supplemental life insurance are classified as ________ in executive compensation packages. A) base salary B) short-term incentives C) deferred long-term incentives D) executive benefits and perks

Q: What is comparable worth? Discuss the connection between comparable worth and the point method.

Q: What are the similarities and differences between developing compensation plans for professionals and lower-level employees? What role does job evaluation play in each?

Q: After establishing a market-competitive pay plan, an employer realizes that some employees are being underpaid and some are being overpaid. How should these two situations be addressed?

Q: Why do employers use pay ranges for each pay grade?

Q: When splitting each factor into degrees in the process of creating a market-competitive pay plan, the number of degrees should not exceed two or three in most cases.

Q: Unlike other job evaluation methods, the ranking method relies heavily on job specifications.

Q: The Equal Pay Act focuses on three compensable factorsknow-how, problem solving, and accountability.

Q: What is the benefit of using pay ranges for each pay grade? A) facilitates the administration of a total rewards system B) gives employers more flexibility in the labor market C) identifies and corrects out-of-line pay rates D) eliminates the need to use a compa ratio

Q: What is a disadvantage of the job classification method? A) vague benchmarking B) reliance on competencies C) complexity of grouping jobs D) difficulty writing grade descriptions

Q: Mario, an HR specialist, is conducting a job evaluation. Mario ranks different components of the job, including complexity, experience, and education required, and then adds up the points for each component. Mario is most likely using the ________ method of job evaluation. A) ranking B) job classification C) factor comparison D) alternative point

Q: Which of the following would most likely help an HR manager determine how many jobs in each pay grade are paid above or below competitive market pay rates? A) compa ratio B) salary survey C) wage structure D) internal wage curve

Q: Which of the following equals an employee's pay rate divided by the pay range midpoint for his or her pay grade? A) pay grade B) rate range C) wage curve D) compa ratio

Q: Which term refers to a series of steps or levels within a pay grade and is usually based on years of service? A) wage grade B) pay range C) compa ratio D) wage curve

Q: A(n) ________ wage curve would most likely indicate whether a firm's pay rates are too low compared to what other firms pay. A) current B) internal C) factored D) market

Q: Employers use salary surveys in all the following ways EXCEPT to ________. A) collect employee benefits data B) price jobs in the marketplace C) price benchmark jobs D) create wage curves

Q: Kayla, an HR manager, is in the process of creating a market-competitive pay plan. For an accounting job at the firm, she has assigned the following weights: 70% for job complexity, 25% for effort, and 5% for working conditions. Assuming that Kayla is working with a total number of 1,000 points, what is the maximum number of points for job complexity? A) 7,000 points B) 700 points C) 70 points D) 7 points

Q: Kayla, an HR manager, is in the process of creating a market-competitive pay plan. For an accounting job at the firm, she has assigned the following weights: 70% for job complexity, 25% for effort, and 5% for working conditions. What is the next step Kayla must take in the process? A) drawing the internal and external wage curves B) converting percentage weights into point values C) defining the degree for each compensable factor D) reviewing job descriptions and specifications

Q: What is the first step in creating a market-competitive pay plan? A) choosing benchmark jobs B) selecting compensable factors C) reviewing relevant job descriptions D) evaluating external and internal wage curves

Q: The purpose of conducting a salary survey is to ________. A) compare internal and external equity B) determine prevailing wage rates C) identify compensable factors D) rank benchmark jobs

Q: A ________ pay system involves setting pay rates based on a comparison between internal pay and external pay. A) ranking B) salary survey C) market-competitive D) compensable factor

Q: What is a drawback associated with the ranking method of job evaluation? A) high costs B) subjective aspects C) time-consuming D) highly complex

Q: Which of the following statements is most likely true about the ranking method of job evaluation? A) Jobs are typically ranked based on the whole job. B) Several compensable factors are commonly used to rank jobs. C) The ranking method is typically more time consuming than other methods. D) Ranking is usually appropriate for large employers because of the method's cost.

Q: What is the first step in the ranking method of job evaluation? A) developing class or grade descriptions B) selecting and ranking jobs by department C) identifying appropriate compensable factors D) gathering job information from a job analysis

Q: Which job evaluation method is considered the simplest and least expensive? A) job classification method B) comparison method C) ranking method D) point method

Q: HR managers and supervisors at Coffman Enterprises have identified a need for job evaluation and have gained the cooperation of employees. What is the next step in preparing for the job evaluation process? A) separating exempt and nonexempt jobs B) selecting a job evaluation committee C) identifying benchmark jobs D) ranking jobs by grade

Q: Which of the following most likely indicates the need for job evaluation? A) work stoppages B) low turnover rates C) vertical promotions D) part-time employees

Q: What is the purpose of the wage curve? A) to show the relationship between the value of the job and the current average pay rates B) to equate jobs of similar difficulty or importance as established by job evaluation C) to cluster jobs into logical groupings for pay purposes D) to choose benchmark jobs within each pay grade

Q: Which of the following shows the relationship between the value and average pay of a job? A) pay group B) pay grade C) benchmark D) wage curve

Q: A ________ is comprised of jobs of approximately equal difficulty or importance as established by job evaluation. A) pay group B) benchmark C) pay grade D) class

Q: Which job evaluation method is a quantitative technique involving the identification of several compensable factors and the degree to which each of these factors is present in the job? A) ranking method B) point method C) factor comparison D) job classification method

Q: Which of the following best describes the point method of job evaluation? A) comparing the importance of each compensable factor B) ranking each job relative to all other jobs based on pay grade C) identifying and quantifying the compensable factors present in a job D) deciding which jobs have a higher number of compensable factors

Q: When using the job classification method of job evaluation, raters categorize jobs into groups of similar jobs called ________. A) classes B) grades C) sections D) cohorts

Q: Basic factors that establish how several jobs compare to one another and that determine the pay for each job are called ________. A) compensable factors B) job evaluation factors C) ranking factors D) analysis factors

Q: Which of the following is used to anchor the employer's pay scale? A) grades B) job aid C) benchmark jobs D) human resource metric

Q: Which of the following is NOT one of the compensable factors emphasized in the Equal Pay Act? A) skills B) effort C) accountability D) responsibility

Q: ________ is a formal and systematic comparison of jobs to determine the worth of one job relative to another. A) Job analysis B) Job evaluation C) Job description D) Job classification

Q: Homelife, a national chain of high-end furniture stores, employs nearly 800 workers. In the past few years, the company's market share has dropped significantly, and employee turnover has increased. Upper management is considering the implementation of a new compensation policy in its efforts to turn the company around. Historically, the company has paid all employees similarly with some variation for seniority but no distinction between high and low performers. Which of the following, if true, supports the argument that Homelife should distribute salary surveys before establishing new pay rates? A) Homelife executives want to identify benchmark jobs before determining the worth of other jobs. B) Computerized job evaluation systems will be used by Homelife to generate questionnaires. C) Homelife executives plan to use the compensable factors emphasized by the Equal Pay Act. D) A wage curve needs to be established by Homelife for the purpose of federal compliance.

Q: Homelife, a national chain of high-end furniture stores, employs nearly 800 workers. In the past few years, the company's market share has dropped significantly, and employee turnover has increased. Upper management is considering the implementation of a new compensation policy in its efforts to turn the company around. Historically, the company has paid all employees similarly with some variation for seniority but no distinction between high and low performers. Which of the following, if true, best supports the argument that Homelife executives should primarily address internal equity issues when developing a new compensation plan? A) Most of Homelife's former employees are now employed at competitors' stores in similar positions. B) Homelife employees receive annual performance appraisals at which time they set career goals. C) Salary surveys indicate dissatisfaction among the Homelife managers in different departments. D) Homelife pays its sales managers commissions in addition to base salaries and health benefits.

Q: Lisa is an HR manager who has been assigned the task of establishing pay rates to ensure external equity. What should Lisa most likely do first? A) conduct a salary survey B) compare performance appraisals C) analyze a scatter plot of employee pay D) use wage curves to price each pay grade

Q: What federal laws stipulate how employers compensate employees? How does an employer determine the monetary value of a job?

Q: As an HR manager, how would you establish pay rates while ensuring external, internal, individual and procedural equity?

Q: Taxi drivers and agricultural workers are always considered exempt employees.

Q: An exempt employee is eligible for overtime pay.

Q: External equity refers to how fair the job's pay rate is when compared to other jobs within the same company.

Q: The provision of the Family and Medical Leave Act that entitles employees to take up to 12 weeks of unpaid, job-protected leave for the birth of a child only applies to women.

Q: The Equal Pay Act states that employees of one sex may not be paid wages at a rate lower than that paid to employees of the opposite sex for doing roughly equivalent work.

Q: Because the minimum wage is set by the Fair Labor Standards Act, there is no variation among states in regarding the minimum wage paid to hourly workers.

Q: When nonexempt employees work more than 40 hours per week, employers must pay overtime at a rate of at least one-and-a-half times the normal pay for any hours worked over 40 in a workweek.

Q: Indirect payments that contribute to an employee's compensation include variable pay like commissions and bonuses.

Q: Financial benefits like employer-paid insurance and vacations are not a part of employee compensation.

Q: All of the following duties most likely indicate that an employee is exempt EXCEPT ________. A) making sales outside of the office B) performing manual office work C) designing computer systems D) managing subordinates

Q: Which of the following employees would most likely be categorized as nonexempt? A) Anna, a registered nurse who earns $59,000/year B) Bob, a teacher who earns $56,000/year C) Carol, a bookkeeper who earns $23,000/year D) Dave, a taxi driver who earns $20,000/year

Q: Which term refers to a compensation plan that includes traditional pay, job design, career development, and recognition? A) point method B) total rewards C) competency-based pay D) talent-management salaries

Q: Which of the following professions is most likely categorized as nonexempt? A) general manager B) pharmacist C) paralegal D) teacher

Q: Which law requires time-and-a-half pay for any hours worked over 40 hours per week involving government contracts amounting to $10,000 or more? A) Title VII B) Davis-Bacon Act C) Fair Labor Standards Act D) Walsh-Healey Public Contract Act

Q: Which 1931 law allows the secretary of labor to set wage rates for laborers employed by contractors working for the federal government? A) Title VII B) Davis-Bacon Act C) Fair Labor Standards Act D) Walsh-Healey Public Contract Act

Q: What type of pay plan is being used when workers are paid a sum for each unit they produce? A) base pay B) competency-based pay C) job-based pay D) piecework

Q: Internal equity refers to ________. A) how a job's pay rate in one company compares to the job's pay rate in other companies B) how fair the job's pay rate is when compared to other jobs within the same company C) the fairness of an individual's pay as compared to what his or her co-workers are earning for the same or very similar jobs within the company, based on each individual's performance D) the perceived fairness of the processes and procedures used to make decisions regarding the allocation of pay

Q: External equity refers to ________. A) how a job's pay rate in one company compares to the job's pay rate in other companies B) how fair the job's pay rate is when compared to other jobs within the same company C) the fairness of an individual's pay as compared to what his or her co-workers are earning for the same or very similar jobs within the company, based on each individual's performance D) the perceived fairness of the processes and procedures used to make decisions regarding the allocation of pay