COMPENSATION AND BENEFITS

Question 1

is defined as the total amount of the monetary and non-monetary pay provided to an employee by an employer in return for work performed as required.

Answer 1

COMPENSATION

Question 2

is the initial rate of compensation an
employee receives in exchange for services. It excludes extra lump sum compensation such as bonuses or overtime pay, as well as benefits and raises. An employee’s base pay can be expressed as an hourly rate or as
a weekly, monthly or annual salary.

Answer 2

BASE PAY

Question 3

is a sum of money that is paid to an
employee upon completion of a task, usually the task of selling a certain amount of goods or services.

Answer 3

COMMISSIONS

Question 4

money earned at an increased rate for
working more than the usual number of hours

Answer 4

OVERTIME PAY

Question 5

is an approach to compensation that rewards the higher performing employees with additional pay or incentive pay

Answer 5

Bonuses, Profit Sharing, Merit Pay

Question 6

a benefit in the form of an option given
by a company to an employee to buy stock in the company at a discount or at a stated fixed price.

Answer 6

Stock Options

Question 7

These rates are likely to differ based on whether the employee travels in his or her home area, away from home, or internationally.

Answer 7

Travel/Meal/Housing Allowance

Question 8

is any additional advantage an employee
receives from his or her employer.

Answer 8

Benefits

Question 9

are surveys of compensation paid to employees by other employers in a particular geographic area, industry, or occupational group.

Answer 9

Pay Surveys

Question 10

generally refer to hourly compensation paid to operating employees. The basis for wages is time.

Answer 10

WAGES

Question 11

is income paid to an
individual on the basis of
time.

Answer 11

Salary

Question 12

is a schedule specifying the amount of annual increases a person will receive.

Answer 12

maturity curve

Question 13

is a method for determining the relative value or worth of a job to the organization so that individuals who perform that job can be compensated adequately and
appropriately.

Answer 13

Job evaluation

Question 14

attempts to group sets of jobs together into clusters, which are often called grades.

Answer 14

Classification system

Question 15

requires managers to qualify, in objective terms, the value of the various elements of specific jobs.

Answer 15

point system

Question 16

involves compensating
employees for learning
specific information.

Answer 16

Pay-for-knowledge

Question 17

rewards employees for
acquiring new skills.

Answer 17

Skill-based pay

Question 18

is the ongoing process of managing a wage and salary structure.

Answer 18

Wage and salary administration

Question 19

refers to
the extent to which
the compensation of
any individual in an
organization is secret
or the extent to which
it is formally made
available to other
individuals.

Answer 19

PAY SECRECY

Question 20

occurs when individuals with substantially different levels of experience and/or performance abilities are being paid wages or salaries that are relatively equal.

Answer 20

Pay compression

Question 21

occurs when the external
market changes so rapidly that the new
employees are actually paid more than
experienced employees.

Answer 21

Pay inversion

Question 22

is a mandated protection plan that provides a basic substance payment to employees who are between jobs.

Answer 22

UNEMPLOYMENT INSURANCE

Question 23

provides limited income to
retired individuals.

Answer 23

SOCIAL SECURITY

Question 24

is insurance that Covers individuals who suffer a job-related illness or accident.

Answer 24

WORKERS’ COMPENSATION

Question 25

are administered by the
organization and provide income to the
employees at their retirement.

Answer 25

Private Pension Plans

Question 26

a private pension plan where the benefit is precisely known based on a simple formula such as years of service.

Answer 26

Defined benefit plans

Question 27

a private pension plan in which the size of the benefit depends on how much money is contributed to the plan.

Answer 27

Defined contribution plans

Question 28

concentrate on keeping
employees from
becoming sick rather than
simply paying expenses
when they do become ill.

Answer 28

WELLNESS PROGRAM

Question 29

assist parents with child
care expenses.

Answer 29

CHILD CARE PROGRAMS

Question 30

allow employees to
choose the benefits they
really want.

Answer 30

CAFETERIA-STYLE BENEFITS

Question 31

includes
provisions for the minimum wage,
overtime, and child labor.

HR managers must
adhere to overtime
laws.

Answer 31

Fair Labor Standards Act