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Compensation and Benefits > Final Exam Chapters 1,3,7,11,13 > Flashcards

Final Exam Chapters 1,3,7,11,13 Flashcards

1
Q

A small business owner is trying to design a reward system that produces the behaviours the business wants. As a compensation consultant, what is the best advice you could provide?

A

There is no one best compensation system that fits all firms

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2
Q

What are intrinsic rewards in the workplace derived from?

A

job content and higher-order human needs

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3
Q

As a human resources manager, you determine that your company needs to increase the level of extrinsic rewards provided to employees. Which of the following would you focus on?

A

performance-based pay

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4
Q

What type of rewards are exemplified by interesting jobs, lots of skill variety, feedback, and the freedom to act?

A

intrinsic

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5
Q

What is the first step in formulating a compensation strategy?

A

to determine the organizational context

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6
Q

According to the total rewards approach, a company must first establish which of the following strategies before developing its compensation system?

A

rewards strategy

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7
Q

According to the textbook, what is the ultimate goal of an optimal reward system?

A

to add the most value, once all costs are calculated

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8
Q

What are the three main behaviours that are desirable to an organization?

A

membership behaviour, task behaviour, and citizenship behaviour

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9
Q

As part of the compensation system, what is the purpose of job evaluation?

A

determine a job’s relative worth to other jobs in the company

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10
Q

According to the textbook, what is the definition of a compensation system?

A

It is the economic or monetary part of the reward system.

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11
Q

Which of the following is an example of indirect pay?

A

employee benefits

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12
Q

Which statement best defines an incentive?

A

It is a promise that a specified reward will be provided if the employee performs a specified behaviour.

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13
Q

According to the textbook, what did Dan Price, the CEO Gravity Payments, do after he was challenged by an employee?

A

increased the minimum salary for all employees to $70,000 per year

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14
Q

According to the textbook, which statement best describes IBM’s bonus reward program?

A

It was ineffective and produced inefficient software.

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15
Q

What percentage of their operating budget do companies typically spend on employee compensation?

A

40-70%

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16
Q

Which of the following is an example of an employee behaviour that employers want from the reward system?

A

organizational citizenship

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17
Q

Which of the following is a process theory of motivation?

A

expectancy theory

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18
Q

Which of the following leads to reward dissatisfaction?

A

violation of the psychological contract

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19
Q

Which statement best characterizes a reward system associated with a company using a classical management strategy such as the Koch Foods chicken processing plant?

A

It tends to be highly extrinsic.

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20
Q

You’re angry and resentful because you think your contribution is greater than that of the other clerks in your department, and you believe you’re not being paid fairly. What’s the source of your reward dissatisfaction?

A

perceived personal inequity due to equity sensitivity

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21
Q

Which statement best describes affective commitment?

A

Sense of belonging, loyalty and identification with organization’s goals.

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22
Q

An employee is dissatisfied with a recent change to a reward system. What is the employee likely to do if their goal is to maximize rewards received?

A

increase effort and performance

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23
Q

According to the expectancy theory, which of the following would be an example of positive expectancy?

A

You believe your effort will lead to good performance.

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24
Q

Which managerial strategy is most closely linked with the notion of the economic theory of motivation?

A

classical

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25
Q

According to the textbook, what is the first step in designing a reward system that leads to desired behaviours on the part of employees?

A

defining the behaviours the organization needs

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26
Q

What would a human relations organization need to rely on to promote positive membership behaviour?

A

task and membership behaviour

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27
Q

What should a retail organization do if it is experiencing high employee theft?

A

revaluate its reward system and pay higher wages relative to competitors

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28
Q

What are individuals who have affective commitment more likely to do?

A

stay at a job out of a sense of loyalty

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29
Q

According to the textbook, which organization will offer employees $2000 to quit after one week of paid training?

A

Zappos

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30
Q

Whose theory of motivation states lower orders needs must be satisfied before higher order needs?

A

Maslow

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31
Q

Which is the simplest process theory?

A

Reinforcement theory

32
Q

ABC Inc. is a new organization planning to launch a call centre in the next six months. You have been tasked with creating detailed job descriptions for several operational roles in the call centre. Which information collection method would you likely rely on to gather job information?

A

Functional job analysis

33
Q

Which of the following methods in the pay equity planning process uses a male comparator?

A

Job to job method

34
Q

Similar to comparing apples and oranges, which process is used to determine the relative value of different jobs to the organization?

A

Job evaluation

35
Q

According to the textbook, why might using job descriptions for job evaluation purposes prove problematic?

A

The dynamic nature of the general environment creates a situation whereby job duties change without human resources departments noticing it.

36
Q

Which method of job analysis focuses on the behaviours that make up a job and uses job elements to describe work activities?

A

Position Analysis Questionnaire

37
Q

Which method of job evaluation is useful for firms with large numbers of jobs and is most commonly used for pay equity?

A

point factor

38
Q

What is a valid reason to re-evaluate jobs?

A

There is a high level of appeals.

39
Q

What is the first step in most pay equity processes?

A

determine what rules and laws apply

40
Q

Which of the following is the fourth step in Ontario’s pay equity process?

A

Select a gender-neutral job comparison method.

41
Q

What is the observation method of job analysis well-suited for?

A

jobs that have a short work cycle

42
Q

What is the major benefit for the ranking method of job analysis?

A

It is one of the least complicated systems.

43
Q

What are the three main reasons for conducting job evaluations?

A

to control wage costs, to create equitable pay structures, and to create the perception of an equitable pay system among participants

44
Q

Which term refers to an organization that gives an employee the ability to appeal a decision of the job evaluation committee?

A

procedural justice

45
Q

What would happen if an organization used the job-to-job method to establish a pay equity plan and there was no male comparator?

A

A proportional value evaluation would be required.

46
Q

What is one problem with using the ranking/paired job evaluation method?

A

It is not acceptable to pay equity commissions.

47
Q

What is a necessary component of goal-sharing plans

A

Specified performance goals are met

48
Q

Which statement best describes an employee stock option plan?

A

Employees receive options to purchase company stock at a future time at a fixed price.

49
Q

A manufacturer wants to reward employees based on the company’s ability to reduce the number of direct and indirect labour hours associated with one unit of output. What kind of gain-sharing plan is this organization considering?

A

Improshare

50
Q

ABC Ltd. uses a series of independent measures in its gain-sharing formula, including labour/material usage, quality metrics, customer satisfaction, and number of accidents. Which component will be included in a gain-sharing plan if it is stipulated that no bonus will be paid for periods in which work-related accidents occurred?

A

modifier

51
Q

What is the key to ensuring the viability of the gain-sharing plan?

A

valid historical baseline

52
Q

What is one of the major drawbacks of executive “top hat” profit-sharing plans?

A

They are not widely available to all employees.

53
Q

Which basis for allocating the profit-sharing bonus may be perceived as unfair to senior employees based on their long-term commitment to the firm?

A

equal distribution

54
Q

Which statement best describes the notion of “share appreciation rights” provided to a manager in a publicly traded company?

A

It is a “marriage” of two concepts: stock options and stock bonus plan.

55
Q

A “Golden Banana” is an example of what kind of nonmonetary award?

A

symbolic

56
Q

Which of the following would be categorized as a goal-sharing plan?

A

financially funded plan

57
Q

What is the first step in designing a goal-sharing plan?

A

define the group

58
Q

What should the pay frequency of profit sharing be in organizations where profits fluctuate by season?

A

annually

59
Q

Which of the following is a profit-sharing plan?

A

current distribution plan

60
Q

What percentage of medium-to-large employers in Canada use nonmonetary rewards programs?

A

50

61
Q

In which type of organization do nonmonetary reward programs seem to be most effective?

A

high-involvement organizations

62
Q

As an owner of a large business, what budgeting strategy are you using in which you set a cap on the total amount of compensation available for the coming year and then divide the available funds among your department managers to distribute to their employees?

A

Top-Down

63
Q

Which managerial strategy is most likely to staff its compensation task force with a diverse range of employees?

A

High-involvement management

64
Q

Which task should be included in the planning process to deal with the administration of the compensation system?

A

developing the process for ongoing communication

65
Q

Which term refers to the process of calculating employee earnings and the appropriate remittances are paid to employees, governments, and other agencies?

A

compensation administration

66
Q

ABC Ltd. is contemplating outsourcing some of their payroll and benefits administration. Which of the following would be the least critical factor to consider?

A

approach taken by competitors

67
Q

What is a key aspect of developing the implementation plan?

A

planning for communicating the new system

68
Q

Which of the following is a change in internal circumstances that can trigger the need to change the compensation system?

A

financial circumstance change

69
Q

What should a compensation specialist do if an evaluation of the compensation system reveals that the expected results are not occurring?

A

Attempt to evaluate why the desired results are not occurring.

70
Q

Why did the the federal government’s Phoenix payroll system fail so badly?

A

because the scope of the implementation task was underestimated

71
Q

The compensation rates for the coming year are applied to employees, factoring in probable merit and seniority increases as well as expected turnover, and the compensation budget for the coming year is based on the total dollar amount derived from this process. What is this budgeting system is known as?

A

bottom up approach

72
Q

What was a result of passing Bill 88, the Electronic Commerce Act, in Ontario?

A

It allowed digital paystubs.

73
Q

What did Canada Post avoid with its new integrated HRIS and payroll system?

A

the customization trap

74
Q

What is the third stage of the compensation implementation plan?

A

testing the system

75
Q

What is step two of implementing the compensation system?

A

creating the infrastructure

76
Q

Which term refers to the total compensation divided by the number of full-time equivalent employees?

A

average employee earnings

77
Q

Quality and quantity of work produced fall under which type of behaviour?

A

Task

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