Chapter 7 - Total Rewards

Question 1

financial inducements and rewards as well as nonfinancial inducements and rewards, such as the value of good job content and good working environment

Answer 1

total rewards

Question 2

base pay, commissions, bonuses, merit pay, piece rate, differential pay, cash award, profit sharing, gain-sharing

Answer 2

direct compensation

Question 3

social security, unemployment insurance, disability insurance, pensions, 401(k) and other similar programs, healthcare, vacations, sick leave and paid time off suck as holidays

Answer 3

indirect compensation

Question 4

The systematic determination of the relative worth of jobs in an organization is known as

Answer 4

job evaluation

Question 5

comparison of jobs based on each job’s measurable factors

Answer 5

job ranking

Question 6

the result of grouping jobs into a predetermined number of grades or classifications

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job classification

Question 7

an approach using specific compensable factors as reference points to measure relative job worth

Answer 7

point factor job evaluation

Question 8

Uses a standard criteria comprising three compensable factors: know-how, problem-solving, and accountability.

Answer 8

the hay plan

Question 9

Determines levels of duties and responsibilities using a point rating system to evaluate selected positions. Uses weighted factors to address the major position characteristics of responsibility, education/experience, job conditions, physical requirements, supervision, training, and so on.

Answer 9

The Factor Evaluation System (FES)

Question 10

involves ranking each job by each compensable factor and then, as an additional step, identifying dollar values for each level of each factor to develop an actual pay rate for the evaluated job

Answer 10

factor comparison method

Question 11

a technique used to make outdated data current

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Aging

Question 12

adjustments to survey numbers by an appropriate percentage needed to achieve a match with specific jobs

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leveling

Question 13

a process that involves each job by each compensable factor and then identifying dollar values for each level of each factor to develop an actual pay rate for the evaluated job

Answer 13

factor comparison job evaluation

Question 14

listing of grouped pay data from lowest to highest

Answer 14

frequency distribution

Question 15

number of workers in a particular job classification and their pay data

Answer 15

frequency tables

Question 16

quantitative or non-quantitative programs allowing sorting or categorizing jobs based on their relative worth to the organization

Answer 16

job evaluation method

Question 17

key jobs are measured and valued against the market, and the remaining jobs are inserted into a hierarchy based on their whole-job comparison to the benchmark jobs

Answer 17

market based job evaluation

Question 18

collections of data on prevailing market pay rates and information on starting wage rates, base pay, pay ranges, overtime pay, shift differentials and incentive pay plans

Answer 18

pay survey

Question 19

an average result taking into account the number of participants and each participant’s pay

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weighted average

Question 20

combination of several pay grades or job classifications with narrow range spreads into a single band with a wider spread

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broadbanding

Question 21

the way an organization organizes jobs of a similar value into job or groups

Answer 21

pay grades

Question 22

pay amounts constrained by the upper and lower boundaries of each pay grade

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pay ranges

Question 23

distribution of data into percentage ranges, such as top 10 percent

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percentiles

Question 24

distribution of data into 4 quadrants

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quartiles

Question 25

dispersion of pay from the lowest boundary to the highest boundary of the pay range

Answer 25

range spreads

Question 26

an indicator of how wages match, lead or lag the midpoint of a given pay range computed by dividing the worker's pay rate by the midpoint of the pay range

Answer 26

compa-ratios

Question 27

division of the pay range into several steps that can be advanced by an employee when time-in-job has met the step requirement

Answer 27

automatic step rate

Question 28

employees receive step-rate increases up to the established role

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combination step-rate and performance

Question 29

when pay is linked to the level at which an employee can perform in a recognized competency

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competency based system

Question 30

employee receives one rate of pay up to the production standard and a higher rate of pay when the standard is exceeded

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differential piece rate system

Question 31

each worker in the same job has the same rate of pay regardless of seniority or job performance

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flat-rate or single system

Question 32

pay that is based on the level of knowledge an employee has in a particular field

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knowledge-based system

Question 33

a system with pay determined based on individual job performance

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performance-based merit pay system

Question 34

employee capabilities rather than how the job is performed determine the employee's pay

Answer 34

person-based system

Question 35

when pay is determined by the employee's production output

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productivity-based system

Question 36

when pay is based on the number and depth of skills that an employee has applicable to their job

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skill-based system

Question 37

a system allowing performance to influence the size or timing of a pay increase along the step system

Answer 37

step rate with performance considerations

Question 38

pay increase given to all employees on the basis of market pressure, usually measured against the consumer price index

Answer 38

cost of living adjustment

Question 39

pay at a rate lower than the minimum rate for the assigned pay range

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green circle rate

Question 40

pay at a rate higher than the maximum for the assigned pay range

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red circle rate

Question 41

a pay increase given to all employees regardless of their job performance and not linked to market pressures

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general pay increases

Question 42

either a stand-alone performance bonus or part of an annual pay increase

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lump sum increases

Question 43

a pay increase based solely on length of service

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seniority pay increases

Question 44

adjustment to base pay programs based on cost of living requirements in various geographic locations where employees work

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geographic based differential pay

Question 45

additional pay for working under adverse conditions caused by environment or due to specific circumstances

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hazard pay

Question 46

adjustment to pay structures based on local competitive comparisons

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labor cost differentials

Question 47

adjustment to base pay programs based on work location remoteness, lack of amenities. climatic conditions and other adverse conditions

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location based differentials

Question 48

additional compensation paid to an employee as an incentive to accept what would normally be considered adverse working conditions, usually based on time, location or working conditions

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pay differentials

Question 49

payment at rates greater than straight pay for working overtime or other agreed condition

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premium pay

Question 50

shift pay, which is generally time-based rewards for employees who work what are considered undesirable shifts such as night shifts

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time based differential pay

Question 51

extra pay provided for travel time, either under legal requirement or by other agreement

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travel pay

Question 52

the act of managing the payroll function

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payroll administration

Question 53

usually computerized software programs designed to accept work time data and generate paychecks or electronic deposit

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payroll systems

Question 54

program that provides medical care and compensates employees for part of lost earnings as a result of a work-related disability

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workers' compensation

Question 55

medical insurance programs that cover some or all of the cost of dental services for subscribers

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dental plans

Question 56

allows health plan members to go to any qualified physician, or other healthcare provider, hospital or medical clinic and submit claims to the insurance company

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fee-for-service plans

Question 57

healthcare program where the insurer is paid on a per person basis and offers healthcare services and staff at its facilities

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health maintenance organization

Question 58

insurance that provides plan subscribers with managed healthcare with the purpose of reducing costs and improving the quality of care

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managed-care plans

Question 59

a type of managed-care plan that is a hybrid of HMO and PPO plans

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point of service plan

Question 60

healthcare program including an in-network and an out-of-network option for services

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preferred provider organization

Question 61

medical insurance programs that cover some or all of the cost of prescription drugs for subscribers

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prescription drug plans

Question 62

health insurance programs paid entirely by the employer

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fully funded plans

Question 63

purchasing agents for a large group of employers

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health insurance purchasing cooperatives

Question 64

health insurance programs paid for in part by the employer and in part by the employee

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minimum premium plans

Question 65

health insurance programs where the employer purchases one or two types of stop-loss insurance coverage

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partially self-funded plans

Question 66

health insurance programs where the employer assumes all the risks as a self-insured entity

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self-funded plans

Question 67

health insurance programs where the employer assumes all the risks but hires an independent claims department

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third-party administrator plan

Question 68

health insurance programs in which all of the risks is assumed by the employer

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administrative services only plan

Question 69

when the health plan is protected against the risk of a major illness for one participant or one family unit, covered by the plan

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specific stop-loss coverage

Question 70

methods to be used in fulfilling organizational responsibilities and policies

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procedures

Question 71

the health plan is protected against the risk of large total claims from all participants during the plan year

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aggregate stop-loss coverage

Question 72

allows employees to set aside a pre-established amount of money on a pretax basis per plan year for use in paying authorized medical expenses

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flexible spending account

Question 73

employer funded medical reimbursement plans

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health reimbursement accounts

Question 74

a tax advantaged medical savings account available to tax payers in the US who are enrolled in a HDHP

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health savings accounts

Question 75

these programs help employers lower their costs and allow employees with set-aside money to pay for out-of-pocket medical and medical related expenses

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high deductible health plans

Question 76

allows employees to pay certain qualified expenses one a pretax basis

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section 125 cafeteria plans

Question 77

rewards such as meaningful and fulfilling work, autonomy and positive feedback that lead to high levels of job satisfaction

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intrinsic rewards