Chapter 10 - PART 2

1.

1 point

76) When implementing a job-based compensation plan, it is best that a company:

A) focus on tactical, immediate issues.

C) avoid job banding.

B) narrow each job's pay range.

D) involve employees.

2.

1 point

78) A skill-based approach to compensation is built on which of the following characteristics?

A) Workers are paid for performing well-defined jobs using vertical skills.

C) Each job must be very clearly described with highly defined tasks and skill requirements.

B) The greater the variety of job-related skills a worker possesses, the more he/she should be paid.

D) The primary objective is to allocate pay so that the most important jobs command the highest pay.

3.

1 point

54) Kora is reviewing her company's pay structure and sees, "Grade 3, Able to work independently and use WordPerfect software, $14.57 hr." Kora is most likely reviewing a:

C) decentralized pay system.

A) job-based pay structure.

B) skill-based pay structure.

D) knowledge-based pay system.

4.

1 point

68) If a company uses a committee to sort job descriptions into grades without using a point system, the company is most likely using a ________ system for its job evaluation.

A) ranking

D) policy capturing

C) classification

B) factor comparison

5.

1 point

85) The Equal Pay Act prohibits compensation discrimination between men and women doing substantially the same job, except when:

B) the titles of the jobs in question are different.

A) the pay differential is due to gender.

D) seniority or productivity are the basis for the differential.

C) there is no apparent disparate impact from the practice.

6.

1 point

84) An exempt employee:

A) works as a temporary employee.

D) works part time rather than full time.

B) is more costly to a firm than a nonexempt employee.

C) is not covered by the Fair Labor Standards Act.

7.

1 point

77) When setting up a job-based pay plan, it is most likely important for a firm to:

D) establish a way for employees to improve pay without moving into management.

A) have a relatively flat management hierarchy.

B) use an external consulting firm to ensure objectivity.

C) differentiate among depth, horizontal, and vertical skills.

8.

1 point

71) When management is discussing whether to lead, lag, or pay the "going rate" for a job, they are deciding:

C) how to balance internal equity.

D) their company's pay policy.

A) whether to be egalitarian or elitist.

B) if they want to have an open or secret compensation system.

9.

1 point

83) Which of the following is an example of a non-exempt employee?

C) An HRM professional

D) An hourly employee on the production line

A) A manager

B) A salesperson

10.

1 point

74) Job-based compensation:

C) is less bureaucratic and inflexible than other systems.

B) is the most objective of all compensation systems.

A) is less appropriate at higher levels in a firm.

D) has less bias toward women than skill-based compensation systems.

11.

1 point

65) Both the MAA and the Hay Guide Chart Profile Method share:A) the same compensable factors.

D) the same job hierarchy.

B) the use of a scale of numbers and degrees.

A) the same compensable factors.

C) an emphasis on experience over other factors.

12.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

92) Refer to Case 10.2. Which of the following methods would Sean LEAST likely use?

C) Analyzing equipment costs

A) Interviewing employees

D) Distributing questionnaires to managers

B) Using a point factor system

13.

1 point

60) Job descriptions:

B) list all the compensable factors of a particular job.

A) require the rating of each position described.

D) identify, define, and describe each job in terms of its duties, responsibilities, and working conditions.

C) consist of worker characteristics necessary for successful performance.

14.

1 point

61) Once job specifications and descriptions are created, the next step in developing a compensation system is:

D) assigning individual pay.

A) conducting a job analysis.

C) rating the worth of jobs.

B) creating a job hierarchy.

15.

1 point

56) The design of job-based compensation pay plans begins with:

B) creating a job hierarchy.

A) writing job descriptions.

C) conducting a job analysis.

D) writing job specifications.

16.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

96) Refer to Case 10.2. Which of the following, if true, best supports the use of market data rather than internal job evaluations to determine the value of jobs at O'Donnell?

A) Turnover at O'Donnell is relatively low.

C) The organizational structure at O'Donnell is flat.

B) Most jobs at O'Donnell are typical for the industry.

D) Most lower-level positions at O'Donnell are exempt.

17.

1 point

55) In building a job-based compensation plan, the job evaluation process is designed to assess the:

C) external equity of the system.

D) specific tasks and duties required of the jobs in the plan.

A) relative contribution of different jobs to the organization.

B) relative value or contribution of individual employees to the organization.

18.

1 point

Case 10.1
Brighton Manufacturing is reviewing its compensation system. The CEO wants employees to be paid wages and benefits comparable to Brighton's competitors. He wants a system that allows for maximum flexibility in re-assigning workers to different jobs without requiring compensation adjustments each time. The Finance VP suggests that the company link compensation costs more closely to productivity and profit. When profits are down, compensation costs should be reduced as well. The Finance VP also believes that employees should be paid for what they produce, not for their time, and the compensation program should apply to all employees equally. The VP of HR suggests that the key to the company's success is their employees and advocates an individual-based compensation plan. People should be paid for their skills or knowledge, not just because they are fulfilling certain jobs. The VP of HR also feels that it would be simpler to implement a compensation system by level rather than by job.

89) Refer to Case 10.1. The CEO, VP of HRM, and VP of Finance would most likely agree on a(n):

B) egalitarian pay system.

C) below-market pay system.

D) individual-centered pay system.

A) elitist pay system.

19.

1 point

Case 10.1
Brighton Manufacturing is reviewing its compensation system. The CEO wants employees to be paid wages and benefits comparable to Brighton's competitors. He wants a system that allows for maximum flexibility in re-assigning workers to different jobs without requiring compensation adjustments each time. The Finance VP suggests that the company link compensation costs more closely to productivity and profit. When profits are down, compensation costs should be reduced as well. The Finance VP also believes that employees should be paid for what they produce, not for their time, and the compensation program should apply to all employees equally. The VP of HR suggests that the key to the company's success is their employees and advocates an individual-based compensation plan. People should be paid for their skills or knowledge, not just because they are fulfilling certain jobs. The VP of HR also feels that it would be simpler to implement a compensation system by level rather than by job.

90) Refer to Case 10.1. Brighton executives have decided to implement a decentralized pay system. Which of the following, if true, best supports this decision?

C) Brighton's unit managers have never received compensation training.

B) The Brighton CEO wants pay decisions to be made at the firm's headquarters.

D) A large percentage of Brighton's staff is non-exempt.

A) Brighton is a large, diverse firm that has never faced legal challenges regarding compensation.

20.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

91) Refer to Case 10.2. What is the best way to address O'Donnell's key concern?

C) Conducting a job evaluation

A) Conducting a market survey

B) Referring to the Hay system

D) Initiating a TQM program

21.

1 point

69) An important tool for companies seeking to maintain external equity is the use of:

A) job analysis.

B) job hierarchies.

C) Hay rating scales.

D) market survey data.

22.

1 point

Case 10.1
Brighton Manufacturing is reviewing its compensation system. The CEO wants employees to be paid wages and benefits comparable to Brighton's competitors. He wants a system that allows for maximum flexibility in re-assigning workers to different jobs without requiring compensation adjustments each time. The Finance VP suggests that the company link compensation costs more closely to productivity and profit. When profits are down, compensation costs should be reduced as well. The Finance VP also believes that employees should be paid for what they produce, not for their time, and the compensation program should apply to all employees equally. The VP of HR suggests that the key to the company's success is their employees and advocates an individual-based compensation plan. People should be paid for their skills or knowledge, not just because they are fulfilling certain jobs. The VP of HR also feels that it would be simpler to implement a compensation system by level rather than by job.

87) Refer to Case 10.1. The Finance VP would most likely favor a(n):

B) membership-based system.

A) variable pay system.

C) individual-centered system.

D) egalitarian compensation system.

23.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

95) Refer to Case 10.2. Which of the following would be most appropriate for Jeff to use?

C) Ranking system

A) MAA

D) Classification system

B) Hay Guide

24.

1 point

81) According to surveys, which of the following is most likely true about family businesses?

C) Owners of family businesses have total compensation packages less than those paid to nonowner presidents.

A) Family employees earn twice as much in base salary at family-owned businesses than they would at businesses not owned by family members.

B) Family employees would earn more compensation at similar positions in businesses not owned by family members.

D) Contributions of family member employees outweigh personal needs when determining compensation.

25.

1 point

Case 10.1
Brighton Manufacturing is reviewing its compensation system. The CEO wants employees to be paid wages and benefits comparable to Brighton's competitors. He wants a system that allows for maximum flexibility in re-assigning workers to different jobs without requiring compensation adjustments each time. The Finance VP suggests that the company link compensation costs more closely to productivity and profit. When profits are down, compensation costs should be reduced as well. The Finance VP also believes that employees should be paid for what they produce, not for their time, and the compensation program should apply to all employees equally. The VP of HR suggests that the key to the company's success is their employees and advocates an individual-based compensation plan. People should be paid for their skills or knowledge, not just because they are fulfilling certain jobs. The VP of HR also feels that it would be simpler to implement a compensation system by level rather than by job.

88) Refer to Case 10.1. Which of the following, if true, best supports the compensation plan advocated by the VP of HR?

D) Employees at Brighton rarely need to cover for each other.

A) Turnover at Brighton is relatively low.

C) The technology used at Brighton changes frequently.

B) Most jobs at Brighton require significant employee training.

26.

1 point

79) Skill-based pay plans pose some risks to the organization, such as:

B) being more subjective and arbitrary than job-based pay plans.

C) leading to bias against women and minorities.

A) increasing employees' frustration when they hit the top of the pay structure.

D) not considering the nature of the business.

27.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

94) Refer to Case 10.2. For Jeff to accomplish his task, he most likely needs to:

A) conduct the job evaluations.

C) rate the worth of the jobs.

D) create a job hierarchy.

B) write the job descriptions.

28.

1 point

62) Carlos is reviewing the knowledge, problem-solving skills, and accountability for a particular job. He is most likely reviewing:

A) job specifications.

D) performance benchmarks.

C) working conditions.

B) compensable factors.

29.

1 point

67) When conducting a job evaluation, it is most important to remind employees that:

A) your focus is on the value of the tasks, not their individual performances.

B) you are looking at their individual performance in specific jobs.

D) knowledge and skill are equally important in your assessment.

C) external data is needed to establish the job's position in the job hierarchy.

30.

1 point

80) Which of the following is the most common compensation practice among small firms?

C) Paying bonuses based on company performance

A) Paying below-market rates to technical workers

D) Offering sign-on bonuses to attractive recruits

B) Offering stock options instead of base salaries

31.

1 point

53) The line, "Grade 2, Clerk-Typist, $12.35 hr.," is most likely from a:

A) job-based pay structure.

D) knowledge-based pay system.

C) decentralized pay system.

B) skill-based pay structure.

32.

1 point

57) Michele is determining the value of different jobs in a medium-sized contracting company. She is most likely:

A) performing job analysis.

B) conducting a job evaluation.

D) determining job specifications.

C) trying to achieve internal equity.

33.

1 point

58) The head of HR has asked you to gather information about the tasks, duties, and responsibilities of specific jobs. He has most likely asked you to perform a(n):

A) job evaluation.

C) equity analysis.

D) comparable worth assessment.

B) job analysis.

34.

1 point

64) The MAA gives the highest possible points to which compensable factor?

D) Skill

C) Experience

A) Problem solving

B) Accountability

35.

1 point

73) Job-based compensation systems have a number of disadvantages or drawbacks, such as being:

C) too flexible for managers.

A) difficult to administrate.

D) biased against managerial jobs.

B) subjective and arbitrary.

36.

1 point

70) In order to tie job evaluation data and external wage/salary data together, a company needs to:

A) establish a job hierarchy.

C) identify benchmark jobs.

B) have an open compensation system.

D) use a skill-based compensation system.

37.

1 point

59) Job specifications:

C) consist of worker characteristics necessary for successful performance.

B) list all the compensable factors of a particular job.

A) require the rating of each position described.

D) identify, define, and describe each job in terms of its duties, responsibilities, and working conditions.

38.

1 point

66) A job hierarchy in a compensation plan is primarily built on:

A) job specifications, descriptions, and ratings.

C) corporate pay policies.

B) job classifications by pay grade.

D) market surveys.

39.

1 point

72) As the HR director, you are reviewing the comparability of pay of each employee within a range for particular jobs. You are:

A) applying market survey data.

C) reviewing individual equity.

D) conducting a job analysis.

B) rating individual jobs.

40.

1 point

75) Job-based compensation plans have the advantage of:

D) focusing on the three most important compensable factors, depth, breadth, and vertical skills.

A) being objective, data-based systems.

B) having a bureaucratic and definitive structure.

C) appearing rational and systematic, thereby minimizing employee complaints.

41.

1 point

52) Job-based compensation plans focus on the key component of:

A) openness.

B) equity.

C) motivation.

D) job knowledge.

42.

1 point

Case 10.2
O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VP's will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy.

93) Refer to Case 10.2. Susie's responsibility most likely relates to:

C) identifying job specification components.

D) rating the worth of the jobs.

B) writing the job descriptions.

A) conducting the job evaluations.

43.

1 point

63) The Hay Guide Chart Profile Method of weighing compensable factors in a job is best used when establishing a:

B) job-based compensation system.

C) performance-centered compensation system.

A) skill-based compensation system.

D) variable pay compensation system.

44.

1 point

Case 10.1
Brighton Manufacturing is reviewing its compensation system. The CEO wants employees to be paid wages and benefits comparable to Brighton's competitors. He wants a system that allows for maximum flexibility in re-assigning workers to different jobs without requiring compensation adjustments each time. The Finance VP suggests that the company link compensation costs more closely to productivity and profit. When profits are down, compensation costs should be reduced as well. The Finance VP also believes that employees should be paid for what they produce, not for their time, and the compensation program should apply to all employees equally. The VP of HR suggests that the key to the company's success is their employees and advocates an individual-based compensation plan. People should be paid for their skills or knowledge, not just because they are fulfilling certain jobs. The VP of HR also feels that it would be simpler to implement a compensation system by level rather than by job.

86) Refer to Case 10.1. The CEO is primarily concerned about:

A) external equity.

C) distributive justice.

D) internal equity.

B) skill-based pay.