58) Compensation designed to assist laid-off employees as they search for new employment is
known as ________.
A) COBRA
B) premium pay
C) severance pay
D) workers’ compensation
59) What is the primary reason that firms provide severance pay to employees who are
involuntarily terminated?
A) ensuring that current employees remain with the firm
B) preventing terminated employees from suing the firm
C) complying with federal laws that require severance pay
D) expressing concern and support for terminated employees
60) How do employers benefit from providing outplacement services?
A) minimizing the need for severance pay
B) lowering unemployment insurance costs
C) complying with the WARN Act
D) improving employee good will
61) The termination procedure is usually the most well defined for ________.
A) executives
B) managers
C) hourly workers
D) union workers
62) In organizations of any size, management should ________.
A) use outside consultants for termination procedures
B) explain what actions warrant termination
C) avoid terminating union workers
D) handle terminations formally
63) Who is usually responsible for hiring and firing the CEO?
A) stockholders
B) top management
C) board of directors
D) executive search firms
64) Which of the following is the LEAST likely reason for firing a top-level executive?
A) economic downturn
B) reorganization
C) marketing image
D) productivity decline
65) What is the most common reason that a CEO is terminated?
A) stock and bond markets fluctuate
B) board of directors lacks confidence
C) consumers have different philosophy
D) law enforcement discovers insider trading
66) Which group is typically the most vulnerable to termination?
A) unskilled operatives
B) high level executives
C) lower level managers
D) unionized employees
67) Which of the following is most likely a negative outcome of downsizing?
A) loss of corporate culture
B) outsourcing of technical jobs
C) elimination of senior positions
D) less work for remaining employees
68) Which term refers to the process of moving a worker to a lower level of duties and
responsibilities with a reduction in pay?
A) transfer
B) discipline
C) demotion
D) outplacement
69) Parson Enterprises is a unionized organization. An employee at Parson would most likely
learn how demotions are handled by ________.
A) reviewing the firm’s mission statement
B) contacting the local EEOC office
C) attending a training program
D) reading the labor-management agreement
70) Dixon Enterprises is a unionized organization. An employee at Dixon would most likely
learn how demotions and layoffs are handled by ________.
A) reviewing the firm’s corporate history
B) contacting an outside consultant
C) attending an orientation session
D) reading the labor agreement
71) To the employer, which of the following is a disadvantage of demoting an employee?
A) The demoted employee may find the demotion to be more devastating than termination.
B) The demoted employee may become bitter.
C) The demoted employee avoids unemployment.
D) none of the above
72) Which term suggests a one-time change in the organization and the number of people
employed?
A) demoting
B) downsizing
C) bankrupting
D) outplacing
73) What is the primary purpose of downsizing?
A) hiring new employees
B) meeting EEOC requirements
C) changing the corporate philosophy
D) improving organizational performance
74) According to research, when a firm delays downsizing as long as possible, the firm will most
likely ________.
A) recover more quickly when the economy improves
B) implement a formal grievance procedure
C) force senior employees into retirement
D) file for bankruptcy within one year
75) Lisa, an HR manager, has been informed that her employer will be downsizing. Lisa’s
responsibility is to help the company prepare for downsizing by determining which workers
should be laid off. All of the following are important for Lisa to do EXCEPT ________.
A) targeting older workers who earn high salaries to save the firm money
B) ensuring that protected workers are not disproportionately affected
C) utilizing objective, job–related criteria to make layoff decisions
D) preparing to deal with COBRA and ERISA requirements
76) When a unionized firm is downsizing, what is the most likely basis for layoffs?
A) potential
B) seniority
C) compensation
D) education level
77) Louden Manufacturing, a unionized firm, is in the process of downsizing. Mark is employed
as a senior–level engineer at the firm, and his position has been eliminated. Mark’s manager has
indicated that Mark has the right to force a lower–level engineer out of a position. Which term
best describes this activity?
A) bumping
B) rightsizing
C) restructuring
D) gainsharing
78) Jackie is an HR manager at a union-free firm that is in the process of downsizing. As Jackie
helps determine which employees will be laid off, what will she most likely give the greatest
consideration?
A) organizational needs
B) industry specifications
C) compensation level
D) seniority
79) Research on downsizing has shown that when organizations ________, they tend to bounce
back faster when the upturn hits.
A) resist or delay layoffs as long as possible
B) begin the layoff process as soon as possible
C) use an incremental approach to downsizing
D) lay off the entire workforce
80) According to the WARN Act, covered employers are required to give ________ days
advance notice before a mass layoff.
A) 30
B) 60
C) 90
D) 120
81) Which of the following would most likely be considered a covered employer under the
WARN Act?
A) Barton Consulting, 55 full-time employees
B) Haley Publishing, 85 full-time employees
C) Tyro Aluminum, 145 full-time employees
D) all of the above
82) Which term refers to a procedure whereby laid–off employees are given assistance in finding
employment elsewhere?
A) mediation
B) outplacement
C) arbitration
D) development
83) As a result of downsizing, Heather has lost her job. Heather’s employer is helping Heather
find a job elsewhere. Which of the following best describes what this employer is providing?
A) outplacement
B) development
C) outsourcing
D) contracting
84) Kelly, an HR manager, is employed by a firm that is downsizing. Kelly’s employer wants the
HR department to provide outplacement services to laid-off employees. Which of the following
is LEAST likely to be an outplacement activity?
A) paying expenses for interviews
B) paying federal income taxes
C) providing job-search and interview techniques
D) discussing wage and salary negotiations
85) According to experts, firing employees on Mondays is best because it allows them to begin
searching for a job immediately.
86) Demotion involves moving a worker to a lower level of duties and responsibilities.
87) Downsizing and termination are synonymous terms.
88) In most cases, terminations at unionized firms are based on performance and merit.
89) The term “ghost work” refers to the additional work required of employees who remain after
an organization downsizes.
90) Outplacement helps employers preserve their reputation while softening the impact of
displacement.
91) Employers are required by law to provide severance pay to employees who have been
involuntarily terminated.
92) Firing employees is typically easier to do at unionized firms than at union–free firms.
93) In most cases, terminated CEOs are able to go through the same formal appeal procedure as
terminated nonmanagerial employees.
94) The EEOC requires employers to give employees 60 days’ notice before initiating a mass
layoff.
95) What are the common reasons that CEOs and other top executives are fired?
96) How do employers benefit from outplacement and offboarding?
97) Which of the following is a complaint officer with access to top management who hears
employee complaints, investigates, and recommends appropriate action?
A) line manager
B) HR manager
C) ombudsperson
D) union steward
98) Johnson Enterprises is recruiting candidates to fill the new position of ombudsperson.
Johnson is most likely adding this position to ________.
A) handle internal problems before they become lawsuits
B) negotiate with local and national labor unions
C) monitor the firm’s retention and turnover rates
D) assist HR with compensation decisions
99) Naomi, a data analyst at a consulting firm, has an abusive manager. To which of the
following should Naomi most likely turn for confidential, informal advice?
A) mediator
B) attorney
C) arbitrator
D) ombudsperson
100) Miles, a software designer, received a performance review that he feels is incorrect. Miles
would like to discuss his concerns with an impartial individual at his firm. What are the best two
individuals for Miles to contact in this situation?
A) mediator and ombudsperson
B) HR manager and arbitrator
C) ombudsperson and HR manager
D) arbitrator and union steward
101) A procedure whereby the employee and the company agree ahead of time that any problems
will be addressed by agreed-upon means is known as ________.
A) progressive disciplinary action
B) scheduled grievance procedure
C) alternative dispute resolution
D) neutral arbitration
102) Which of the following is NOT a method used in alternative dispute resolution?
A) arbitration
B) mediation
C) mini–trials
D) work sampling
103) Devon Manufacturing wants to avoid the time and cost associated with employment–related
lawsuits. Which of the following would most likely be the best choice for Devon in resolving
conflicts with employees?
A) collective bargaining
B) progressive disciplinary action
C) alternative dispute resolution
D) mandatory bargaining
104) Which of the following would be a case where alternative dispute resolution would be
used?
A) racial discrimination
B) age discrimination
C) unfair firings
D) all of the above
105) Which form of alternative dispute resolution is the preferred method for most people?
A) arbitration
B) mediation
C) mini–trial
D) ombudspersons
106) Unified Enterprises has implemented an alternative dispute resolution program to resolve
conflicts between the firm and its employees. Which of the following is NOT one of the
advantages associated with alternative dispute resolution?
A) jury trial
B) low cost
C) efficient
D) private
107) According to research, when two parties agree to participate in mediation, approximately
________ of the cases are settled.
A) 35%
B) 55%
C) 75%
D) 96%