Chapter 4 - Components Of Compensation strategy Flashcards
Which of the following steps is NOT considered part of formulating the compensation strategy?
A. Determining the actual dollar values for jobs and individual employees
B. Determining the total level of compensation to provide
C. Determining how each of the mix choices should be structured
D. Determining the mix of compensation components.
Answer is A.
- A particular company wants to make sure employees feel they are appreciated, while at the same time ensuring key employees have a sense of loyalty forwards the company. Which of the following systems does this company most likely use?
a. Benefits
b. Performance pay
C. Indirect pay
D. Base pay.
Answers D.
Johnny is compensated based on a rate of $25.00 per hour worker. Which of the following terms best describes the manner in which Johnny was compensated?
A. Commission
b. Wage
C. Piece of rate
D. Salary
Which of the following is a reason why employees may prefer base pay over performance pay?
A. Performed pay is more predictable
B. Base pay is directly related to their performance level
C. They dislike uncertainty about their compensation
D. Market conditions are always changing
Answer is C
Which of the following conditions make it impractical to use output-related pay?
A. Output is easy to measure
B. Output is very stable
C. Output cannot be controlled by the individual employee
D. Output is easy to price in term of its values to employees
answer is c
As an employer, you believe it is always a good idea to pay for their contributions to organizational results. Which of the following plans would likely be the key component of the compensation plan?
a. Indirect pay
b. Base pay
c. Pay for knowledge
d. Performance pay
Answer is D
A particular organization wants to include in their compensation system some element of organizational performance linkage, while
At the same time it wants to encourage employee commitment. In addition to base pay, which of the following variables like most likely be included in this compensation mix?
A. Merit pay
B. Pieces rat
C. Profit sharing
D. Targeted incentives
C.
Which of the following is an objective of variable pay?
A. To retain long-service employees
b. To help link individual performance to individual pay
C. To help promote cost savings initiatives by employees
D. To help keep labour costs down.
AnswerB
Your company offers you pay for tome not worked, disability benefits, supplemental medical coverage, and a full range of free employee services. These items refer to which component of the compensation mix?
A. Direct pay
b. Base pay
C. Indirect pay
D. Performance pay
A. Indirect pay
As a consultant, you have been asked by an organization to provide a menu of indirect benefits that the employer does not have to provide by law. Which of the following would you NOT include in your menu?
a. Employment insurance
b. Company pension plan
c. psychological counselling
d. Supplemental medical coverage
Which of the following best explains why medical and dental coverage can be purchased more cheaply by the employer than the employee?
a. Indexation
b. Economics of scale
C. Utility
D. Dividends
Which methods are used to establish pay?
A. Market pricing, job evaluation, pay for knowledge
b. Job analysis,
Competency testing and demographics
C. Tenure, job preview and environmental analysis
D. Knowledge,
Education and market pricing
Which of the following refers to Job evaluation?
A. Determining how well a Job is performed
B. Surveying the market
C. Ranking all jobs according to their value to the firm.
D. Establishing the skill level of each employee
Answer is C
As a human resource specialist,
You have been asked by your organization to provide recommendations on which base pay method to use, given that the Human Resources department has very limited human capital financial resources. Which of the following methods would be on top of your list of recommendations?
A. Job evaluation
B. Person-based pay
C. Competency based pay
D. Market pricing
Answer is D
As the owner of a large hotel, you expect your employees to be flexible, learn a variety of skills and shift around from one job to another as needed. Which of the following plans will best fit your needs?
A. Competency based pay
B. Skilled based pay
C. Team based pay
D prices rates
B
