Part B. – Short Answer.   Each question is worth 5 points.  Please do not exceed the sentence maximum response limits. 


1. You are writing an employee handbook for a manufacturing company with 50 employees. The company says it does not need any SDS forms or policies. What do you say?  6 sentence maximum response.


2. Discuss two differences between an HMO and a PPO?  6 sentence maximum response.  


3. Name two common problems with performance evaluations and provide one potential solution to each problem you identified? 6 sentence maximum response.


4. Explain why an employer can limit an employee’s speech in the workplace5 sentence maximum response.


5. What is the difference between a lockout and a strike? 5 sentence maximum response.


6. You lost your job. Why would COBRA help you?  4 sentence maximum response.




Part C – Paragraph Short Answer.  This section is worth 30% of the test grade. This section must be cited by APA style, originally started as the biggest online bookstore, has become a household name by expanding rapidly in the retail market offering millions of movies, games, and music, electronics and other general merchandise categories, including apparel and accessories, auto parts, home furnishings, health and beauty aids, toys, and groceries. Shoppers can also download e-books, games, MP3s, and films to their computers or handheld devices, including Amazon’s own portable e-reader, the Kindle. Amazon also offers products and services, such as self-publishing, online advertising, e-commerce platform, hosting, and a co-branded credit card.

To keep this megastore running at a fast pace, Amazon hired 115,000 employees who generated $74 billion in 2013.  Target and Home Depot made a combined income of close to $74 billion in the same year yet employed more than 340,000 people between them in their retail stores.  Why does it take only one third of its competitors’ labor force to produce same the revenue? Like the other mega retailer Wal-Mart, Amazon has delivered creative business solutions to their own processes in order to continuously increase their operating effectiveness. However, their strategy focuses on enhancing the customer shopping experience and providing excellent customer service rather than providing the lowest priced products. In order to meet their customers’ needs, Amazon must deliver more speed and efficiency in its giant warehouse. They use more automated work-processes which reduce the company’s operational costs, as well increase labor efficiency and employee safety.

Quality of their warehouse labor has become the critical issue in the firm’s success and hence hiring and retaining the best, most suitable candidates for their manual labor positions is a key success factor.  That being said, Amazon’s turnover rate at these lowest ranked positions in the organization is high since Amazon lets go of its lowest-performing employees to make room for new, more appropriate candidates while promoting the very best.  To detect the lowest and top performing employees, Amazon initiated a performance evaluation system called the Organization and Leadership Review (OLR).

OLR actually has two main goals: first, is to find the future leaders and prepare them to be able to face the most challenging tasks presented in a fast paced work environment; and second, to determine the 10% of the employees who are the least effective and take necessary corrective action. OLRs take place twice a year to grant promotions and find the least effective employees.  Only the top-level managers attend this meeting where there could be two reasons why an employee’s name may be mentioned in them. Either the employee is being considered for a promotion the employee has asked for or the employee’s job at Amazon might be at stake.


OLRs start with the attendees reading the agenda of the meeting. Then supervisors suggest the most deserving subordinate’s name to be considered for the promotion. All executives in the room evaluate these suggestions which are then followed by a debate. Promotions are given at the end. During the process, instead of using hard data, executives tend to bring personal experiences by using anecdotes to evaluate the employees’ performance. Anyone in the meeting may deny a promotion therefore ambitious employees seeking a promotion should also be very friendly with their boss’ peers as well. If an employee’s supervisor cannot present him or her well enough, another’s favorite subordinate will get the promotion.


In terms of promotion, Amazon CEO Jeff Bezos expects the managers to set the performance bar quite high in order to allow only the most exceptional talent to progress. Promotions are protected by well-written promotion guidelines which focus on delivery, and impact, not on internal politics. People spend less time campaigning for their own promotions and top performers are heavily compensated based upon the quality of their work. Therefore only a few promotions are available each year and receiving positive feedback from an employee’s supervisor is quite rare. The approval the employee gets from his or her supervisor is not enough from the OLR to get a promotion; he/she will still have to ‘fight’ for the promotion and even if  granted the promotion may not occur immediately.





1.      How might rater bias, stereotyping and traits appraisal impact the accuracy of OLR? Could this be corrected? If so, how?


2.      Given the differing appraisal systems described in this chapter, which appraisal systems mostly closely resembles OLR?  Specifically discuss your response.


3.      Discuss at least one advantage and one disadvantages of having performance reviews like OLR, versus MBO, that are single way communication?

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