Exam 3- Chapter 10

Question 1

Objective Of Pay System

Answer 1

1. Strategic
2. Attractive
3. Equitable
4. Motivating
5. Complies with law and regulations

Question 2

Pay Equity

Answer 2

My outcomes/inputs equals your outcomes/inputs

Question 3

If not equitable/Fair (Your not Paid Fair)

Answer 3

1. Less effort/withdraw effort
2. Increase theft/stealing
3. High turnover; quit
4. Hurt Morale; create a hostile environment
5. Will not look out for the best for the company
6. Bad recruitment
7. Rationalize, justify

Question 4

Pay Structure

Answer 4

Starts with Job analysis
Splits into two categories:
A. Ensure Internal Consistency (Job Evaluation)
b. Ensure External Competitiveness (Market Survey #’s)
Last part is Pay structure/system
(Look at the diagram)

Question 5

Three types of Different Job Evaluation

Answer 5

1. Job Ranking system
2. Job Classification
3. Point System

Question 6

Define Job Ranking System

Answer 6

Your find the most important jobs according to the firm and pay those jobs more. You determine the worth of the job and use market surveys to develop a pay structure system

Question 7

Define Job Classification

Answer 7

You create different classifications of grades. Each grade has a description of the job, knowledge, etc. You than compare the job to the description you made to determine pay. Essentially you have a predetermine pay

Question 8

Define Point system

Answer 8

A system where you have rank compensable factors with weights to see what job is most important to the firm

Question 9

Broadbanning

Answer 9

The range of the salary is increased

Question 10

Exempt vs Nonexempt

Answer 10

Exempt you cannot be paid for overtime

Nonexempt you can get paid for overtime

Question 11

What are the general Employees

Answer 11

Executives
Administrator 
Professionals
Outside sales people
Computer Employees

Question 12

What the federal minimum wage

Answer 12

With insurance 7.25

no insurance 8.25

Question 13

What are employee benefits required by law?

Answer 13

1. social security
2. unemployment insurance
3. worker’s compensation
4. Leave without pay (FMLA)
5. Consolidated omnibus Budget (COBRA)

Question 14

What are some discretionary benefits?

Answer 14

Health Insurance
Child care
Wellness programs
Life and long term care insurance
Payment for time not worked
Pension plans

Question 15

What are the four types of pension plan?

Answer 15

1. Contributory
2. Noncontributory
3. Defined-Benefit
4. Defined contributions

Question 16

What is a contributory pension plan?

Answer 16

Both employer and employee contribute to your pension

Question 17

What is a noncontributory pension plan?

Answer 17

The employer will be the only contributor to the pension plan

Question 18

What is a defined-Benefit pension plan?

Answer 18

You are guaranteed a specific amount. It’s predetermine

Question 19

What is a defined-contribution pension plan?

Answer 19

The way the company will make contributions to your pension. it can be through company stocks or cash.

Question 20

What are characterstics of a 401 K plan

Answer 20

• Tax deferred saving plans ( you don’t pay taxes)

- employees save through payroll

Question 21

Define Vesting and who regulates it?

Answer 21

The point in time when pension monies set aside by a company become the actual property of that individual.

ERISA is in charge of regulating pension plans and setting the minimum standard of vesting

Question 22

What are some flexible employee benefits program/plan AKA Cafeteria Benefits

Answer 22

Pension plan
Paid Vacations
Paid sick leaves
Medical Insurance
Legal insurance
Vision Care
Tuition reimbursement

Question 23

What are the pros and cons of a flexible employee benefits program?

Answer 23

Pros:

• Accommodate differences in employee needs
• Prevent Waste of benefits
• Employees gain a better understanding of the benefits

Cons:

• Difficult to design and administer
• High Administrative Cost
• Possible blame on employer for poor employee choices