1. Which of the following is true of an employer who uses the third-quartile strategy of compensation?
a. The employer pays the employees on par with the market levels.
b. The employer pays the employees above market levels.
c. The employers determine the pay irrespective of the market scenario.
d. The employer pays the employees below market levels.
1. Which of the following is true of the factor-comparison method of job evaluation?
a. It is a qualitative method that combines the classification and ranking methods.
b. In this method, descriptions of each group of jobs are written and then each job is put into a grade according to the group it best matches.
c. It is time-consuming and difficult to use, which accounts for its limited popularity in organizations.
d. It uses subjective judgments to develop the class descriptions and to place jobs accurately in them.
1. If an organization has implemented competitive pay practices and has a fair and reasonable pay structure, employee concerns about inequity can be reduced by sharing this information.
1. Distributive justice is the perceived fairness of the process and procedures used to make decisions about employees, including their pay.
1. The two factors that the pay adjustment matrix considers are _____.
a. the employee’s total productivity and the employee’s position in the pay range
b. the employee’s performance as rated in an appraisal and the employee’s position in the pay range
c. the employee’s total productivity and the total number of hours spent at work
d. the employee’s performance as rated in an appraisal and the total number of hours spent at work
1. _____ are payments calculated on the basis of the time worked.
1. Market banding groups jobs into pay grades based on similar market survey amounts.
1. The most common indirect compensation is employee benefits.
1. If a state’s minimum wage is higher than the federal minimum wage, _____.
a. employers must pay the difference as employee benefits
b. employers must pay whichever wage is higher
c. employers are free to choose between either of the two
d. employers must pay whichever wage is lower
1. Integrating performance appraisal ratings with pay changes can be done through the development of a merit-based performance matrix.
1. Team Spark LLC, a producer of consumer goods, practiced gainsharing. After organizational restructuring, the management has decided to replace gainsharing plans with a piece-rate system. Which of the following is true of Team Spark LLC?
a. It provided group incentives; now it provides organizational incentives.
b. It provided group incentives; now it provides individual incentives.
c. It provided individual incentives; now it provides organizational incentives.
d. It provided individual incentives; now it provides group incentives.
1. The focus of gainsharing is to increase “discretionary efforts.”
1. Variable pay plans attempt to provide tangible rewards, or incentives, to employees for performance beyond normal expectations.
1. _____ are special benefits—usually noncash items—for executives.
a. Golden parachutes
b. Base salaries
c. Executive salaries
1. _____ is a compensation typically computed as a percentage of sales in units or dollars.
a. Basic salary
c. Severance pay
1. Which of the following statements is true of the salary-only approach?
a. The salary-only approach is useful when an organization emphasizes serving and retaining existing accounts.
b. The salary-only approach is not useful in compensating sales representatives who are new to a job.
c. The salary-only approach is useful only when an organization is compensating experienced sales executives.
d. The salary-only approach is useful when an organization emphasizes on generating new sales and accounts.
1. _____ refer to the compensation given to an executive if he or she is forced to leave an organization.
b. Golden parachutes
d. Short-term Incentives
1. To ensure that spot bonuses works efficiently, employers must keep the amounts reasonable and provide them only for exceptional performance accomplishments.
1. Which of the following is the best example of variable pay?
a. Severance pay
b. Basic pay
d. Conveyance allowance
1. According to the provisions of the _____, publically listed companies now must allow shareholders to vote on executive compensation.
a. Lilly Ledbetter Fair Pay Act
b. Dodds-Frank Act
c. Sarbanes-Oxley Act
d. Walsh-Healy Public Contracts Act