100) External equity refers to how fair the job’s pay rate is, when compared to
other jobs within the same company.
Objective: Chapter objective 3
101) The Equal Pay Act focuses on three compensable factors—know-how,
problem solving, and accountability.
Skill: AACSB: Multicultural and Diversity
Objective: Chapter objective 1
102) The Sarbanes-Oxley Act of 2002 makes board members personally liable for
violating their fiduciary responsibilities to their shareholders.
Objective: Chapter objective 1
103) All merit increases are cumulative in that they become a part of an
employee’s base salary.
Objective: Chapter objective 3
104) A key advantage of employee stock ownership plans is that the company gets
a tax advantage equal to the fair market value of the shares that are transferred to
the trustee and can also claim an income tax deduction for dividends paid on
ESOP-owned stock.
Objective: Chapter objective 3
105) The Scanlon plan is a type of gainsharing plan.
Objective: Chapter objective 3
106) Scanlon plans involve putting some portion of an employee’s weekly pay at
risk for the opportunity to earn incentives if the employee meets or exceeds his or
her goals.
Objective: Chapter objective 3
110) Job classification is the simplest of the job evaluation methods.
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Objective: Chapter objective 2
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107) Competencies are demonstrable characteristics of a person including
knowledge, skills, and behaviors that enable performance.
Answer: TRUE
Diff: 2 Page Ref: 198
Objective: Chapter objective 3
108) The primary advantage of broadbanding is that it provides greater flexibility
into employee assignments.
Answer: TRUE
Diff: 3 Page Ref: 213
109) About 99% of employers in the United States offer some form of health
insurance coverage.
Answer: TRUE
Diff: 2 Page Ref: 204
Objective: Chapter objective 4
110) Employee benefits account for about one-third of wages and salaries.
Answer: TRUE
Diff: 2 Page Ref: 204
Skill: AACSB: Analytical Skills
Objective: Chapter objective 4
111) Workers’ compensation benefits can be medical or monetary.
Objective: Chapter objective 4
112) If an employee is injured at work due to a blatant disregard for company
safety policies, the company is not required to pay workers’ compensation.
Objective: Chapter objective 4
113) Women affected by pregnancy and childbirth are eligible for the same
benefits as disabled employees.
Objective: Chapter objective 4
114) The American Disabilities Act makes it illegal for employers to discriminate
against women by providing benefits of a lower amount or duration for
pregnancy, childbirth, or related medical conditions.
Objective: Chapter objective 2
30
115) The Comprehensive Omnibus Budget Reconciliation Act ensures that
employers are not responsible for making health benefits available to terminated
or retired employees and their families.
Objective: Chapter objective 4
116) There is no limit to the amount an employee can contribute pre-tax into a
401(k) plan each year.
Objective: Chapter objective 4
117) Broadbanding refers to the requirement to pay men and women equal wages
for jobs of comparable value to the employer.
Objective: Chapter objective 4
118) List the steps used to establish pay rates while ensuring external, internal,
and procedural equity.
Skill: AACSB: Communication
Objective: Chapter objective 2
119) List the steps used in the job ranking method of job evaluation.
Skill: AACSB: Communication
Objective: Chapter objective 2
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120) What are the steps for pricing jobs with a wage curve?
Skill: AACSB: Communication
Objective: Chapter objective 3
121) Explain the advantages of employee stock ownership plans.
Skill: AACSB: Communication
Objective: Chapter objective 3
122) Explain the purpose of sick leave and why sick leave pay causes difficulties
for many employers.
Skill: AACSB: Communication
Objective: Chapter objective 4
123) Why do employers provide severance pay to employees who are being
terminated? Offer at least three reasons. What standards guide the amount of
severance pay offered?
continuing salary for a set time period. Many firms establish severance pay at the
rate of one week of severance pay for each year of service.
Skill: AACSB: Communication
Objective: Chapter objective 4
124) Explain the three types of benefits provided by Social Security.
Skill: AACSB: Communication
Objective: Chapter objective 4
125) Explain the three classifications that apply to basic pension plans.
Skill: AACSB: Communication
Objective: Chapter objective 4
126) Why are family-friendly benefits increasingly valuable to employees? What
are some examples of family-friendly benefits?
Skill: AACSB: Communication
Objective: Chapter objective 3
127) Briefly explain how an at-risk variable pay plan works.
employee’s weekly pay at risk. If employees meet or exceed their goals, they earn
incentives. If they fail to meet their goals, they forgo some of the pay they would
normally have earned.
Objective: Chapter objective 3
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