Multiple Choice Flashcards by Mackenzie T

Which of the following is NOT a contributing factor to wage determination?

a) gender
b) education
c) size of organization
d) volunteer experience
e) tenure

d) Volunteer Experience

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Which of the following refers to a multiple meaning of compensation?

a) societal
b) employee
c) stockholder
d) relational
e) personal

e) relational

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___ includes cash compensation, benefits, and relational returns.

a) total compensation
b) total cash benefit
c) total base pay
d) total rewards
e) total incentive

d) total rewards

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___ refers to one-time payments for meeting previously established performance objectives.

a) COLAs’
b) Incentives
c) Merit Increments
d) Relational Returns
e) Allowances

b) incentives

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External competitiveness refers to:
a) competitiveness between different departments in a company
b) the relative importance of jobs within a company
c) comparison of product prices with that of competitors
d) comparison of compensation with that of competitors
e) inflationary pressure caused by external market factors

d) comparison of compensation with that of competitors

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Which of the following pay policies lays emphasis on performance?

a) Employee contributions
b) Administration of the pay system
c) External competitiveness
d) internal alignment
e) management

a) Employee contributions

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Which of the following is true of internal alignment?

a) It does not influence the company’s compensation objectives.
b) It compares pay between jobs inside a single organization.
c) It uses incentive programs as a technique to implement the policy.
d) It places greater emphasis on performance than the other policies.
e) It relates to comparison of compensation with that of competitors.

b) It compares pay between jobs inside a single organization.

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Internal alignment may be achieved by:

a) creation of cross-functional departments
b) matching competitors’ wage rates
c) paying below-market base wages but offering training and rapid promotion
d) compensating employees at above-market rates
e) comparing pay between jobs or skill levels inside a single organization

e) comparing pay between jobs or skill levels inside a single organization

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Which of the following is true of the present value perspective?

a) It considers today’s initial offers to employees.
b) it considers future bonuses, merit increases, and promotions.
c) It establishes a limit on the amount spent on benefits.
d) It creates an external competitiveness through future promises.
e) It assesses the present value of a company to offer stock options to employees.

b) it considers future bonuses, merit increases, and promotions.

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___ refers to the compensation given to purchase items that are in short supply.

a) Variable pay
b) Incentive
c) Cost-of-living adjustment
d) allowance
e) wage

d) allowance

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A focus on compensation decisions that help the organization gain and sustain competitive advantage is known as ___:

a) strategic perspective
b) strategic alliance
c) planned perception
d) association perspective
e) competitive heterogeneity

a) strategic perspective

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A business practice or process that results in better performance than one’s competitors is known as ____:

a) strategic perspective.
b) strategic alliance
c) planned perception
d) association perspective.
e) competitive advantage

e) competitive advantage

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A supporting compensation approach for an innovator:

a) places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to encourage innovations.
b) seldom stresses on innovations or risk taking.
c) stresses doing more with less by minimizing costs and specifying in greater detail exactly how jobs should be performed.
d) stresses delighting customers and bases employee pay on how well they do this.
e) focuses on system control and work specifications.

a) places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to encourage innovations.

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A customer-focused business strategy:

a) places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to encourage innovations.
b) stresses new products and short response times to market trends.
c) stresses doing more with less by minimizing costs, encouraging productivity increases, and specifying in greater detail exactly how jobs should be performed.
d) stresses delighting customers and bases employee pay on how well they do this.
e) focuses on business practice or process that results in better performance than one’s competitors.

d) stresses delighting customers and bases employee pay on how well they do this.

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According to the pay model, the strategic compensation decisions regarding objectives involve:

a) how the different types and levels of skills and work should be paid within the organization.
b) how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.
c) how total compensation should be positioned against competitors.
d) how pay increases should be based.
e) how open and transparent the pay decisions should be to all employees.

b) how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.

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According to the pay model, the strategic compensation decisions regarding external competitiveness involve:

c) how total compensation should be positioned against competitors.

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According to the pay model, the strategic compensation decisions regarding management involve:

a) how the different types and levels of skills and work should be paid within the organization
b) how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.
c) how total compensation should be positioned against competitors.
d) how pay increases should be based.
e) how open and transparent the pay decisions should be to all employees.

e) how open and transparent the pay decisions should be to all employees.

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Which of the following is NOT an employee preference?

a) deferring taxes
b) changing benefit coverage
c) cultural differences
d) child care coverage
e) flexible working arrangements

c) cultural differences

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Which of the following is a step in the development of the total compensation strategy that deals with competitive dynamics?

a) mapping a total compensation strategy
b) implementing cultural and regulatory progress
c) implementing strategy
d) assessing total compensation implications
e) reassessing the fit

d) assessing total compensation implications

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Personal satisfaction in work accomplished, security, advancement opportunity, and means to share in the company success are fostered by a company’s ___:

a) core culture and values.
b) social and political context.
c) competitive heterogeneity.
d) patronage concentration.
e) competitive dynamics.

a) core culture and values

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Which of the following is an example of job evaluation?

a) comparison of tasks within a job
b) ordering of tasks within a job
c) ordering of jobs based on their content
d) ordering jobs based on their value
e) comparison of jobs within an organization

e) comparison of jobs within an organization

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The systematic process of collecting relevant information related to the nature of a specific job refers to:
a) Job content
b) job evaluation
c) job structure
d) job analysis
e) job description

d) job analysis

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Job evaluation is the process of:

a) finding qualified candidates to fill job vacancies
b) evaluating employee performance in order to establish a rational pay structure
c) summarizing reports that describe the job as it is actually performed
d) comparing jobs within an organization
e) providing information needed to prepare job description

d) comparing jobs within an organization

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When job analysis is done for compensation purposes, data collected must focus on:

a) providing training to job incumbents
b) establishing job similarities and differences
c) increasing the number of different tasks an employee performs
d) monitoring performance of the job incumbent
e) reviewing task inventories

b) establishing job similarities and differences

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Job analysis usually collects information about: a) specific tasks or behaviours b) tentative agreements c) standing policy d) standing plans e) performance appraisal

a) specific tasks or behaviours

Which of the following involves the elemental tasks or units of work, with emphasis on the purpose of each task? a) task analyzability data b) task variety data c) task identity data d) job design data e) job content data

e) job content data

Which of the following is an advantage of conventional questionnaires and interviews used for job analysis? a) The process is both systematic as well as objective. b) The process is virtually free of faulty results. c) The process takes lesser time than quantitative methods. d) The process involves employees, which increases their understanding. e) The entire process is free from bias and favouritism.

d) The process involves employees, which increases their understanding.

Which of the following is true of quantitative methods of job analyses? a) They are more open to favouritism than conventional methods. b) They are more subjective than conventional methods. c) They are less accurate than conventional methods. d) They allow for statistical analysis of the results. e) They are less systematic than conventional methods.

d) They allow for statistical analysis of the results.

Which of the following should a manager do if employees and their supervisors do not agree on what is part of the job? a) file a grievance b) reengineer the job c) collect more data d) revise organization structure e) write job analysis

c) collect more data

Which of the following is true about job description? a) It includes the integrating mechanism associated with job. b) It includes the organization's rules, norms, and SOPs. c) It includes the task analyzability associated with the job. d) It includes the task significance associated with the job. e) It includes the reporting relationships associated with the job.

e) It includes the reporting relationships associated with the job.

_ is the process of determining and quantifying the relative values of jobs in an organization? a) Job processing b) Job structuring c) Job evaluation d) Factor weighting e) Job description

c) Job evaluation

ob value may include all the following EXCEPT: ____. and/or, or i (minimum wage). a) its value in the external market b) external market rates c) its relationship to some other set of rates that have been agreed upon through collective bargaining d) its relationship to government legislation e) its relationship to a set of rates that have been agreed upon through a negotiation process

b) external market rates

Which of the following would NOT be considered a way to make job value rigorous and systematic? a) documentation b) objectivity c) generalizability d) acceptability e) reliability

d) acceptability

Selecting benchmark jobs from each level ensures coverage of the entire work domain, thus helping to ensure the _______ of the decisions based on the job evaluation: a) validity b) objectivity c) accuracy d) credibility e) acceptability

c) accuracy

Which of the following is a disadvantage of point method of job evaluation? a) Compensable factors do not communicate what is valued. b) Basis for comparisons is not called out. c) It can become bureaucratic and rule-bound. d) It cannot be applied to non-benchmark jobs. e) It compensable factors are not aligned with the organization's strategy.

c) It can become bureaucratic and rule-bound.

Which of the following is an advantage of the ranking method of evaluation? a) It is fast, simple, and easy to explain. b) It is best suited for a rapidly growing organization. c) It makes the criteria for evaluating jobs explicit. d) It frees the process of evaluation from subjectivity. e) It does not require the evaluator to know about all jobs under study.

a) It is fast, simple, and easy to explain.

Which of the following job evaluation methods is based on job class descriptions into which jobs are categorized? a) point method b) simple ranking method c) paired comparison method d) classification method e) alternation ranking method

d) classification method

Which of the following is the first step in the design of a point plan for job evaluation? a) determine compensable factors b) determine factor weights c) prepare a communication manual d) conduct job analysis e) establish plan for non-benchmark jobs

d) conduct job analysis

Which of the following is the final step involved in the design of a point plan for job evaluation? a) determine compensable factors b) communicate the plan and train users c) prepare a communication manual d) conduct job analysis e) apply plan to non-benchmark jobs

e) apply plan to non-benchmark jobs

Point plans represent a significant change from ranking and classification methods in that: a) they make explicit the criteria for evaluating jobs b) they assign the task of evaluation to a single employee c) they list jobs from highest to lowest based on a global definition of value d) they do not involve conducting job analysis e) they cannot be applied to non-benchmark jobs

a) they make explicit the criteria for evaluating jobs

Observable behaviours that indicate the level of competency within each competency set are known as: a) cognitive patterns b) competence builders c) core competencies d) behavioural descriptors e) core mnemonics

d) behavioural descriptors

Competency-based pay plans are different from skill-based plans in that: a) competency-based plans are not very specific; they are more general, paying for underlying, broadly applicable knowledge, skills and behaviour b) competency-based plans are applied only to blue-collar jobs c) competency-based plans eliminate the need to control costs d) competency-based plans do not allow for lateral movement e) competency-based plans are a type of job-based pay structures

a) competency-based plans are not very specific; they are more general, paying for underlying, broadly applicable knowledge, skills and behaviour

Pay structures that link pay to the depth or breadth of the abilities and knowledge a person acquires, which are relevant to work are known as _____ pay structures. a) job-based b) task-based c) opportunity-based d) skill-based e) mission-based

d) skill-based

Which of the following is true about competencies? a) they focus of average performance rather than optimal performance b) they discourage employees from assuming leadership roles c) they fail to provide a common basis for working together d) they create risk that need to be managed due to inferred proficiencies e) they make people lose their focus

d) they create risk that need to be managed due to inferred proficiencies

The higher labour costs under skill-based pay indicate that it may be a better fit to companies where _____. a) labour costs are a small share of total costs b) labour costs are a large share of total costs c) employees lack motivation to increase their skills d) employees focus on seeking promotions to earn more pay e) the focus is on average performance rather than optimum performance

a) labour costs are a small share of total costs

A(n) _____ system is one where pay increases come with certification of new abilities. a) assignment-based b) work-based c) multiskill-based d) task-based e) job-based

c) multiskill-based

Which of the following is true about certification methods? a) Certification cannot be accomplished through peer review. b) Certification cannot be accomplished through on-the-job demonstrations. c) Newer certification procedures are moving away from on-demand review and towards scheduling fixed-review points. d) Scheduling makes it more difficult to budget and control payroll increases. e) Recertification has been replaced with one-time certification.

c) Newer certification procedures are moving away from on-demand review and towards scheduling fixed-review points.

The most important decision in competency analysis is:__________________ a) deciding what information is correct b) clarifying the objective of the plan c) deciding who to involve d) establishing certification methods e) conducting research

b) clarifying the objective of the plan

A pay structure in which employees are paid based on the work knowledge that they acquire is known as: a) skill-based pay structure b) task-based pay structure c) assignment-based pay structure d) work-based pay structure e) duty-based pay structure

a) skill-based pay structure

Employees and managers are the sources of information for all the following EXCEPT: a) defining the skills b) assessing the skills c) arranging skills into a hierarchy d) bundling skills into skill blocks e) certifying whether a person possesses the skills

b) assessing the skills

Which of the following statements about employee benefits is true? a) Employee benefits of all types are mandated by law and are not discretionary. b) Employee benefits are not part of a company's total compensation package. c) Employee benefits are funded either by the government or the employer; not the employee. d) Employee benefits of all types are discretionary and are not mandated by law. e) Most employee benefits are not taxable.

e) Most employee benefits are not taxable.

Which method of financing benefit plans allows costs to be shared between employer and employee? a) non-contributory b) ESOPs c) employee financed d) contributory e) income-security

d) contributory

Which of the following factors relate to employee preferences in determining desirable components of a benefits package? a) competitor offerings b) legal requirements c) perceived fairness d) costs relative to benefits e) relationship to total compensation costs

c) perceived fairness

What is vesting of pension benefits? a) It is the exclusion of new employees from benefits coverage until some term of employment is completed. b) It is the reduction of benefits by any amount paid under a spouse's plan. c) It is the negotiation some employers have with employees about wage concessions to reduce employer contributions to selected benefits. d) It is a general strategy used to control medical benefit costs by promoting preventive health programs. e) It occurs when employees become entitled to the employer-paid portion of pension benefits upon termination of employment.

e) It occurs when employees become entitled to the employer-paid portion of pension benefits upon termination of employment.

Benefits administration involves three main functions: (1) communicating the benefits program, (2) claims processing, and (3) _____. a) legal compliance b) competitor assessment c) cost containment d) tracking employee usage e) revising benefits

c) cost containment

Under which of the following cost containment strategies are the benefits of an employee reduced by any benefits payable under his or her spouse's plan? a) deductibles b) coinsurance c) benefit maximums d) coordination of benefits e) administrative cost containment

d) coordination of benefits

____ refers to a specified dollar amount of claims paid by the employee each year before insurance benefits begin: a) Coinsurance b) Wage concession c) Deductible d) Benefit cutback e) Vesting

c) Deductible

Which of the following employee benefits is NOT legally required? a) Quebec Pension Plan b) Employment Insurance c) Workers' Compensation d) employee assistance plan e) breaks, vacation, and leaves

d) employee assistance plan

Which of the following is an employee benefit required by law? a) breaks, vacation, and leaves b) employee assistance plan c) payments for vacation d) employee stock ownership plan e) severance pay plan

a) breaks, vacation, and leaves

Which of the following is true of Workers' Compensation? a) Employees are not eligible for cover if their actions caused the injury. b) They cover injuries and diseases that are not work-related. c) They provide benefits for loss of earnings due to permanent disability; not temporary. d) The contributions made to the plan are subject to tax. e) The complete cost of administering and paying out for the plan is borne by the employer.

e) The complete cost of administering and paying out for the plan is borne by the employer.

In which of the following situations are larger incentive components appropriate? a) organizations have a highly variable annual performance and employees have jobs that are fairly stable b) when organizations have a stable annual performance and employees have jobs that are fairly stable c) when organizations have low variability in corporate performance d) when organizations have a highly variable annual performance and employees have jobs that fluctuate greatly in terms of what's expected of them e) when organizations work in an unstable external environment and employees have stable jobs with little fluctuations

c) when organizations have low variability in corporate performance

_____ is a process involving the determination of what is important to a person and offering it in exchange for desired behaviour. a) Procedural justice b) Motivation c) Workflow d) Evaluation e) Socialization

b) Motivation

Which of the following factors cannot motivate performance according to Herzberg's Two-Factor theory? a) recognition b) promotion c) achievement d) security e) empowerment

d) security

According to the _____ theory of motivation, challenging and specific performance goals generate higher employee effort. a) Herzberg's Two-Factor b) expectancy c) equity d) goal setting e) Maslow's Hierarchy of Needs

d) goal setting

_____ theory of motivation states that people behave as though they cognitively evaluate what behaviours are possible. a) Expectancy b) Equity c) Agency d) Two-factor e) Reinforcement

a) Expectancy

_____ theory of motivation states that employees and management/owners both will act opportunistically to obtain the most favourable exchange possible. a) Expectancy b) Equity c) Agency d) Two-factor e) Reinforcement

c) Agency

Which of the following wage components is most risky to the employee? a) merit pay b) a-the-board increase c) lump-sum bonus d) profit-sharing e) g-sharing

d) profit-sharing

Turnover is much higher for poor performers: a) when pay is based on individual performance b) when pay is based on group incentive plans c) when pay is based on relational returns d) when pay is based on company profits e) when pay is based on industry standards

a) when pay is based on individual performance

Which ranking process makes it easier to identify the extremes? a) Behaviourally anchored ranking b) Alternation ranking c) Performance ranking d) Straight ranking e) Paired comparison ranking

b) Alternation ranking

Which method is both a planning tool and an appraisal tool? a) Simple ranking b) Alternation ranking c) Behaviourally anchored paired rating d) Paired comparison performance ranking e) Management by objectives

e) Management by objectives

What is the primary focus of a merit pay system? a) to reward employees for exceptional performance on special projects b) to reward employees for not being fired c) to link increases in base pay to how employees are rated on a subjective performance evaluation d) to offer a uniform merit increase to all employees across performance levels e) to provide end-of-year bonuses that do not build into base pay

c) to link increases in base pay to how employees are rated on a subjective performance evaluation

The major focus of individual spot awards is on: a) linking increases in base pay to employee ratings on performance evaluations b) rewarding group or team performance c) promising pay for some objective, pre-established level of performance d) awarding employees for performance that exceeds expectations d) rewarding employees with monthly increments to keep up their motivation

d) awarding employees for performance that exceeds expectations

Which of the following is true of a straight piecework system? a) It is the least frequently implemented incentive system. b) It is a system where standards are based on time per unit. c) It is a system where rate determination is based on units of production per time period. d) It is a complex system and hence is not readily accepted by employees. e) It is based on providing end-of-year bonuses when the organization performs well.

c) It is a system where rate determination is based on units of production per time period.

Which of the following is a customer-focused performance measure? a) economic value added b) cycle time c) distribution systems d) return on sales e) service / quality index

b) cycle time

Which of the following is a problem with group compensation systems? a) At least one person in the group does not carry his or her share of the load. b) There is very little room for variation in designing group incentive plans. c) Group incentive plans are often too simplistic and do not accurately reflect the efforts of the group. d) If teams are defined at a very narrow level, much of the motivational impact of incentives is lost. d) Team membership constantly changes as teams are eager to share their star performers and take on new employees.

a) At least one person in the group does not carry his or her share of the load.

What is the main difference between a Scanlon plan and a Rucker plan? a) A Scanlon plan requires worker committees while a Rucker plan does not. b) A Scanlon plan is dependent on productivity norms while a Rucker plan works better without them. c) A Scanlon plan is a gain-sharing plan while a Rucker plan is an individualized incentive plan. d) A Scanlon plan focuses on reducing labour costs, while a Rucker plan focuses on increasing labour costs. e) A Scanlon plan involves a less complex formula than a Rucker plan for determining worker incentive bonuses.

e) A Scanlon plan involves a less complex formula than a Rucker plan for determining worker incentive bonuses.

A(n) _____ is an incentive plan that includes reductions in base pay in unsuccessful years. a) gain-sharing plan b) earnings-at-risk plan c) profit-sharing plan d) broad-based option plan e) Scanlon plan

b) earnings-at-risk plan

Which of the following plans would an organization use if they had a highly uncertain future? a) gain sharing b) team incentives c) quality incentives d) stock ownership or options e) cash profit sharing

d) stock ownership or options

Employee stock ownership plans: a) provide employees with the right to purchase stock at a specified (exercise) price for a fixed time period b) grant stock options to employees at all levels rather than just senior executives c) offer employees the opportunity to purchase company stock, often partially or fully matched by employer-paid stock for the employee d) provide employees with end-of-year bonuses that do not build into their base pay e) link increases in base pay to how highly employees are rated on a subjective performance evaluation

c) offer employees the opportunity to purchase company stock, often partially or fully matched by employer-paid stock for the employee

Which of the following is an example of a long-term incentive in an executive compensation package? a) pension plans b) base pay c) stock grants d) low-cost loans e) bonuses

c) stock grants

Which of the following factors helps in the reduction of labour costs? a) Increasing the number of employees b) Making early retirement less attractive c) Expanding the core workforce d) Paying more benefits and less cash e) Paying the same wages to fewer employees

e) Paying the same wages to fewer employees

The most common approach to managing labour costs during a recession involves: a) reducing employees' variable pay b) using competitive market rates c) reducing the workforce d) using a top-down budgeting e) hiring only core employees

c) reducing the workforce

A group of employees with whom a strong and long-term relationship is desired is: a) part-time employees b) temporary workers c) contingent workers d) core employees e) contract employees

d) core employees

Which of the following is true about core employees? a) They are employees whose employment agreements cover only short, specific time periods. b) They help achieve flexibility and control labour costs. c) They have many varied compensation packages. d) They bring about an increase in the fixed portion of labour costs. e) They can be contracted and expanded more easily than the contingent workers.

d) They bring about an increase in the fixed portion of labour costs.

Employers achieve flexibility and control labour costs by: a) expanding the permanent workforce b) hiring only full-time employees c) basing employee payment decisions on manager preferences d) forming strong and long-term relationships with all employees e) expanding or contracting the contingent workforce

e) expanding or contracting the contingent workforce

Which of the following factors influences decisions made using the top-down approach? a) estimating the pay increase budget b) providing consultation to managers c) analyzing forecasts d) monitoring budget versus actual increases e) reviewing and revising forecasts and budgets with management

a) estimating the pay increase budget

An index that measures changes in prices over time is known as the: a) Consumer Price Index b) Producer Price Index c) Cost of Living Index d) Manufacturer Price Index e) Cost Price Index

a) Consumer Price Index

The budgeting approach that requires senior management of each unit to estimate the pay increase for the entire organization unit is known as the: a) top-down budgeting approach b) decentralized budgeting approach c) bottom-up budgeting approach d) employee-participation budgeting approach e) peer budgeting approach

a) top-down budgeting approach

To help ensure that different managers grant consistent increases to employees with similar performance ratings and in the same position in their ranges one should utilize: a) outsourcing techniques b) merit grids c) job security measures d) management by objectives e) ad hoc reshuffling

b) merit grids

Which of the following is a step in the bottom-up approach to controlling salary level? a) examining the current year's rise in average wages b) managers to forecast pay increase recommendations c) determining the company's ability to pay d) analyzing the impact of cost-of-living increases on wages e) instructing managers in compensation policies and techniques

e) instructing managers in compensation policies and techniques

Multiple Choice Flashcards

(90 cards)