A Framework for Human Resource Management, 7e (Dessler)
Chapter 7 Compensating Employees
1) ________ refers to all forms of pay or rewards going to employees and arising
from their employment.
A) Reimbursement
B) Employee compensation
C) Salary
D) Benefits
Objective: Chapter objective 1
2) Direct financial payments include all of the following except:
A) wages.
B) insurance.
C) salaries.
D) incentives.
Objective: Chapter objective 1
3) Which of the following is categorized as an indirect payment portion of
employee compensation?
A) wages
B) salaries
C) employer-paid insurance
D) bonuses
Objective: Chapter objective 1
4) Which of the following factors affects the design of any pay plan?
A) legal
B) union
C) equity
D) All of the above.
Objective: Chapter objective 2
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5) Which compensation-related law contains minimum wage, maximum hours,
overtime pay, equal pay, and child labor provisions?
A) Davis-Bacon Act
B) Fair Wages Act
C) Civil Rights Act
D) Fair Labor Standards Act
Objective: Chapter objective 1
6) Which of the following is addressed by the Fair Labor Standards Act?
A) minimum wage
B) maximum hours
C) child labor
D) All of the above.
Objective: Chapter objective 1
7) The Fair Labor Standards Act covers workers employed in ________.
A) manufacturing
B) retailing
C) service industries
D) All of the above.
Objective: Chapter objective 1
8) Which law makes it illegal to discriminate against any individual with respect
to compensation because of race, color, religion, sex, or national origin?
A) Fair Labor Standards Act
B) Civil Rights Act
C) Employer Retirement Income Security Act
D) Davis-Bacon Act
Objective: Chapter objective 1
9) According to the Fair Labor Standards Act, if a worker covered by the act
works more than 40 hours, he or she will receive overtime pay at a rate of
________ of normal pay for any hours worked over 40 in a workweek.
A) 50%
B) 100%
C) 125%
D) 150%
Objective: Chapter objective 1
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10) Jill works as a cashier at a grocery store. She earns $8 an hour (or $320 for a
40-hour week). Last week, she worked 44 hours. Given standard requirements
from the FLSA, what did she earn last week?
A) $320
B) $336
C) $344
D) $368
Skill: AACSB: Analytical Skills
Objective: Chapter objective 1
11) Jack worked 6 hours of overtime this week but has decided to take time off
instead of overtime pay. How many hours will Jack get off?
A) 3 hours
B) 6 hours
C) 9 hours
D) 12 hours
Skill: AACSB: Analytical Skills
Objective: Chapter objective 1
12) Which of the following occupations must adhere to overtime and minimum
pay provisions stated in the Fair Labor Standards Act?
A) paralegals
B) pharmacists
C) attorneys
D) department heads
Skill: AACSB: Analytical Skills
Objective: Chapter objective 1
13) All of the following occupations are exempt from the overtime provisions
stated in the Fair Labor Standards Act except:
A) physicians.
B) dentists.
C) management trainees.
D) teachers.
Objective: Chapter objective 1
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14) The ________ states that employees of one sex may not be paid wages at a
rate lower than that paid to employees of the opposite sex for doing roughly
equivalent work.
A) American Disabilities Act
B) Civil Rights Act
C) Employer Retirement Income Security Act
D) Equal Pay Act
Objective: Chapter objective 1
15) Under which condition is it acceptable for employees of the opposite sex to
receive different pay for doing roughly equivalent work?
A) when the difference exists despite equal skills
B) when the difference exists despite similar responsibility
C) when the difference exists because of a merit system
D) it is never acceptable
Skill: AACSB: Multicultural and Diversity
Objective: Chapter objective 1
16) Which of the following professions is considered “nonexempt” from
provisions of the Fair Labor Standards Act?
A) attorney
B) physician
C) management trainee
D) general manager
Objective: Chapter objective 1
17) The ________ prohibits discriminating against employees who are 40 years of
age and older in all aspects of employment, including compensation.
A) Fair Labor Standards Act
B) Civil Rights Act
C) Equal Pay Act
D) Age Discrimination in Employment Act
Skill: AACSB: Multicultural and Diversity
Objective: Chapter objective 1
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18) According to the Family and Medical Leave Act, eligible employees can take
up to ________ weeks of unpaid, job-protected leave for the birth of a child or for
the care of a child, spouse, or parent.
A) two
B) four
C) six
D) twelve
Objective: Chapter objective 1
19) According to the Family and Medical Leave Act, eligible employees can take
unpaid, job-protected leave for the ________.
A) care of a child
B) birth of a child
C) care of a parent
D) All of the above.
Objective: Chapter objective 1
20) Which of the following is true for employers who use independent
contractors?
A) Fair Labor Standards Act regulations do not apply
B) Social Security taxes are higher than for regular employees
C) State income taxes are charged at a higher rate
D) Social Security taxes are charged at a higher rate
Objective: Chapter objective 1
21) The ________ allows a firm to borrow against employee stock held in trust.
A) Fair Labor Standards Act
B) Civil Rights Act
C) Employer Retirement Income Security Act
D) National Labor Relations Act
Objective: Chapter objective 1
22) Historically, the main issue in collective bargaining is ________.
A) time off with pay
B) wage rates
C) income security
D) health care benefits
Objective: Chapter objective 1
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23) Unions negotiate all of the following pay-related issues except:
A) wage rates
B) income security
C) unpaid leave to care for an immediate family member
D) time off with pay
Objective: Chapter objective 1
24) Which form of equity refers to how a job’s pay rate in one company compares
to the job’s pay rate in other companies?
A) external
B) internal
C) distributive
D) procedural
Objective: Chapter objective 1
25) Jason is an information systems technician in a town in North Carolina with a
population of 100,000. He earns $35,000/year. He recently found out that a nearby
town with a similar population pays people in the same position $40,000/year.
Jason is concerned with the ________ form of equity.
A) distributive
B) procedural
C) internal
D) external
Skill: AACSB: Analytical Skills
Objective: Chapter objective 1
26) Which form of equity refers to how fair a job’s pay rate is, when compared to
other jobs within the same company?
A) external
B) internal
C) distributive
D) individual
Objective: Chapter objective 1
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27) Jack is a sales manager and he recently learned that human resource managers
with similar responsibilities and spans of control earn more than he does. Jack is
concerned with the ________ form of equity.
A) external
B) internal
C) distributive
D) individual
Skill: AACSB: Analytical Skills
Objective: Chapter objective 1
28) External equity refers to ________.
A) how a job’s pay rate in one company compares the job’s pay rate in other
companies
B) how fair the job’s pay rate is, when compared to other jobs within the same
company
C) the fairness of an individual’s pay as compared with what his or her coworkers
are earning for the same or very similar jobs within the company, based on each
individual’s performance
D) the perceived fairness of the processes and procedures used to make decisions
regarding the allocation of pay
Objective: Chapter objective 1
29) Internal equity refers to ________.
A) how a job’s pay rate in one company compares the job’s pay rate in other
companies
B) how fair the job’s pay rate is, when compared to other jobs within the same
company
C) the fairness of an individual’s pay as compared with what his or her coworkers
are earning for the same or very similar jobs within the company, based on each
individual’s performance
D) the perceived fairness of the processes and procedures used to make decisions
regarding the allocation of pay
Objective: Chapter objective 1
30) ________ is a formal and systematic comparison of jobs to determine the
worth of one job relative to another.
A) Job analysis
B) Job evaluation
C) Benchmark analysis
D) Job ranking
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Objective: Chapter objective 2
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31) Which of the following is not one of the compensable factors emphasized in
the Equal Pay Act?
A) skills
B) effort
C) accountability
D) responsibility
Objective: Chapter objective 2
32) Factors that establish how the jobs compare to one another and set the pay for
each job are called ________ factors.
A) compensable
B) job evaluation
C) ranking
D) analysis
Objective: Chapter objective 2
33) When using the job classification method of job evaluation, raters categorize
jobs into groups of similar jobs called ________.
A) classes
B) grades
C) sections
D) cohorts
Objective: Chapter objective 2
34) When using the job classification method of job evaluation, raters categorize
jobs into groups of jobs that are similar in difficulty but not in context called
________.
A) classes
B) grades
C) sections
D) cohorts
Objective: Chapter objective 2
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35) The point method of job evaluation entails ________.
A) identifying several compensable factors, each having several degrees, and the
degree to which each of these factors is present in the job
B) ranking each job relative to all other jobs based on some overall factor
C) using raters to categorize jobs into groups
D) deciding which jobs have more of the chosen compensable factors
Objective: Chapter objective 2
36) Which job evaluation method is a quantitative technique involving the
identification of several compensable factors and the degree to which each of
these factors is present in the job?
A) ranking method
B) point method
C) factor comparison
D) job classification method
Objective: Chapter objective 2
37) A ________ is comprised of jobs of approximately equal difficulty or
importance as established by job evaluation.
A) pay group
B) benchmark
C) pay grade
D) class
Objective: Chapter objective 2
38) The ________ shows the pay rates currently paid for jobs in each pay grade,
relative to the points or rankings assigned to each job or grade by the job
evaluation.
A) pay group
B) pay grade
C) class
D) wage curve
Objective: Chapter objective 2
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