48) Which federal law established standards for child labor?
A) Social Security Act
B) Walsh–Healey Act
C) Fair Labor Standards Act
D) Labor Management Relations Act
49) Overtime pay is not legally required for ________.
A) nonexempt employees
B) exempt employees
C) blue-collar workers
D) salaried employees
50) A senior statistician would probably be categorized as what type of employee under the Fair
Labor Standards Act?
A) administrative
B) executive
C) professional
D) outside salesperson
51) Which of the following would NOT be an exempt employee under the Fair Labor Standards
Act?
A) production manager
B) machine operator
C) senior statistician
D) outside salesperson
52) Which of the following is NOT an exception for paying women less than men for performing
equal work?
A) seniority-based pay
B) merit–based pay
C) any factor other than the sex of an employee
D) any factor, including the sex of an employee
53) Pay for similar jobs does not vary across different labor markets.
54) Interindustry differentials can be attributed to a number of factors, including the industry’s
product market, the degree of capital intensity, the profitability of the industry, unionization, and
gender mix of the workforce.
55) Unions’ gains often influence nonunion companies’ compensation practices. Many nonunion
companies offered similar compensation to their employees.
56) Factors that must be taken into account when building compensation systems include the
labor market, labor unions, interindustry wage differentials, the economy, and legislation.
57) The Walsh-Healy Act was the first national law to mandate a minimum wage.
58) One of the primary purposes of the Fair Labor Standards Act of 1938 was to eliminate
substandard wages and to prevent children from excessive work hours.
59) Nonexempt employees are categorized as executive, administrative, professional employees,
and outside salespersons.
60) Cost-of-living allowances are becoming increasingly popular in nonunion settings.
61) Nominal compensation and real compensation are never equal.
62) According to research, merit pay, which is similar to an annual bonus, is highly successful in
motivating employee performance and improving compensation satisfaction.
63) Merit pay is a one-time financial award based on productivity.
64) Merit payments are relatively small gifts given to employees for outstanding work or effort
during a brief period of time.
65) Piecework is an incentive pay plan where employees are paid for each unit they produce.
66) Competency-based pay plans are increasingly common as employees shift from traditional
jobs to variable work assignments.
67) Seniority is the length of time an employee has been associated with the company, division,
department, or job.
68) Profit sharing is a compensation plan that helps HR managers with recruiting and retaining
employees.
69) In general gainsharing plans are intended to link employees to organizational productivity by
focusing on cost-efficiency.
70) The Scanlon plan provides a financial reward to employees for savings in labor costs that
result from their suggestions and serves as a type of participative management program.
71) Compare and discuss skill-based and competency–based systems of pay.
72) What is a profit-sharing plan? Identify and discuss the pros and cons of it.
73) What are the advantages and disadvantages of team-based pay?
74) There are many contextual influences that must be taken into account when designing and
implementing direct financial compensation plans, and one of them is interindustry wage or
compensation differentials. Briefly, state the implications of these differentials for establishing
competitive compensation programs. Then, explain the factors that contribute to the existence of
interindustry wage differentials.
75) What form of pay equity exists when employees are paid according to the differences in job
characteristics within the company?
A) internal
B) employee
C) external
D) team
76) As an HR manager, what tool would you most likely use to determine if internal equity exists
at your firm?
A) job analysis
B) job evaluation
C) compensation survey
D) behavioral methods study
77) Which of the following job evaluation techniques is placed in the nonquantitative type?
A) point method
B) ranking method
C) job description method
D) factor comparison method
78) Management relies on all of the following to help determine the relative worth of a job,
EXCEPT ________.
A) job analysis
B) job enumeration
C) job descriptions
D) job evaluation
79) What is the primary by-product of job analysis?
A) human resource planning
B) job evaluation
C) equity analysis
D) job description
80) What is the process that determines the relative value of one job in relation to another?
A) job specification
B) job description
C) job evaluation
D) job analysis
81) The primary purpose of job evaluation is to ________.
A) prepare job descriptions
B) eliminate internal pay inequities
C) lay the groundwork for job analysis
D) price jobs within a geographic area
82) What is the LEAST likely reason that a firm would use job evaluation?
A) eliminating pay inequities
B) identifying the organization’s job structure
C) estimating the average market pay rate
D) developing a hierarchy of job value for creating a pay structure
83) Irene, an HR manager, needs to use a quantitative job evaluation method. Which two
methods would meet Irene’s needs?
A) point and ranking
B) ranking and classification
C) point and factor comparison
D) factor comparison and classification
84) Omar works in the HR department at a large manufacturing firm. Omar needs a simple
method for conducting a job evaluation. Which method would be most appropriate for Omar?
A) factor comparison
B) classification
C) ranking
D) point method
85) Which job evaluation method involves defining a number of grades to describe a group of
jobs?
A) ranking
B) classification
C) factor comparison
D) point
86) In which job evaluation method do evaluators make decisions based on five universal
elements?
A) ranking
B) classification
C) factor comparison
D) paired-comparison
87) How many universal job factors are there with the factor comparison job evaluation method?
A) 3
B) 5
C) 7
D) 9
88) Which of the following is NOT one of the universal job factors of the factor comparison
method?
A) working conditions
B) abstract thinking skills
C) physical requirements
D) responsibilities
89) Eric, an HR manager, is using a job evaluation method in which he assigns numerical values
to specific job factors before calculating the sum of the values. Which method is Eric most likely
using?
A) factor comparison
B) classification
C) ranking
D) point method
90) Historically, some variation of which job evaluation plan has been the most popular option?
A) ranking
B) classification
C) factor comparison
D) point method
91) Nicole, an HR professional, needs to develop a job evaluation for a data analyst position at
her firm. Nicole’s manager wants a quantitative job evaluation that will be useful for a long time.
Which method would be most appropriate?
A) point
B) profile
C) classification
D) ranking
92) As the HR manager at a new firm, Kelly is responsible for the process of job evaluation.
Kelly has completed a job evaluation for each position at the firm. What will most likely be the
direct result of Kelly’s work?
A) job structure
B) financial equity
C) job alignment
D) organizational fit
93) In the ________ of job evaluation, raters assign numerical values to specific job factors, such
as knowledge required, and the sum of these values provides a quantitative assessment of a job’s
relative worth.
A) point method
B) factor comparison method
C) classification method
D) chart profile method
94) Job evaluation is a process that determines the relative value of one job in relation to another.
95) The classification method of job evaluation is the simplest job evaluation method and
requires comparing a job description with a class description.
96) In the ranking method of job evaluation, raters assign numerical values to specific job
factors, such as knowledge required, and the sum of these values provides a quantitative
assessment of a job‘s relative worth.
97) In a brief essay, describe job evaluation and market pricing.
98) Which of the following is a compensation policy choice?
A) nominal pay
B) commissions
C) real pay
D) pay mix
99) Which of the following provides general guidelines for making compensation decisions?
A) pay leaders
B) market rates
C) compensation policies
D) compensation packages
100) Organizations that pay higher wages and salaries than competing firms use ________.
A) an indirect financial compensation policy
B) going rate followers
C) pay followers
D) a market lead policy
101) Benson Enterprises pays lower salaries than its competitors in order to control labor costs,
especially when the firm’s financial condition is weak. Which type of compensation policy is
most likely in place at Benson Enterprises?
A) conservative pay policy
B) market lag policy
C) economical pay policy
D) individual rate policy
102) The average or typical pay that most employers provide for a similar job in a particular area
or industry is known as the ________ rate.
A) pay follower
B) pay leader
C) market
D) wage
103) Firms which pay below the average labor market price for jobs will most likely have
________.
A) higher productivity levels
B) higher turnover rates
C) lower unit labor costs
D) fewer grievances
104) Which of the following is an example of a pay mix policy?
A) less emphasis on both pay and employee benefits and more emphasis on nonfinancial
compensation
B) more emphasis on pay equity between men and women
C) more emphasis on incentive pay than base pay
D) less emphasis on attaining market pay leadership
105) When determining pay mix, it generally does not make sense to consider guidelines for jobs
within a particular structure (for example, managerial, administrative, or sales).