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Exam 10: Managing Compensation

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Question 31

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A pay plan in which most employees are part of the same compensation system is referred to as a(n)________.

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egalitaria...

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Question 32

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Karen, president of a small restaurant chain, would like to centralize compensation decisions. She asks you about the pitfalls of such a move, and you should most likely respond that:

A) internal equity would not be maintained.
B) it is likely that the company will not be able to defend itself legally.
C) external equity is difficult to maintain.
D) it is only beneficial during great economic prosperity.

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Question 33

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Job-based pay policies work best in which of the following situations?

The Internal Revenue Code affects how benefits are treated for tax purposes.

Carlos is reviewing the knowledge, problem-solving skills, and accountability for a particular job. He is most likely reviewing:

Job descriptions:

Additional Case 10.2 O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VPs will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy. -Refer to Additional Case 10.2. Which of the following would be most appropriate for Jeff to use?

Which of the following is most likely true regarding compensation systems?

Pay openness would work best in which of the following situations?

Cornilia and Janice have similar jobs at different firms. Janice is compensated with higher pay and better benefits than Cornilia, which bothers Cornilia. Cornilia's concern reflects the compensation issue of:

If management wants the compensation system to reinforce a traditional organizational structure and stability within the company, a(n) ________ compensation system is the best choice.

Decentralizing pay decisions most likely enables a company to:

________ is a program designed to reward employees for good performance.

Open pay policies tend to lead to greater dissatisfaction among employees as employees compare compensation with each other.

The distributive justice model is based on the idea that:

According to your text, which of the following questions is LEAST relevant to developing an effective compensation plan?

The distributive justice model of pay equity holds that the wage rate for a given occupation is set at a point where the labor supply and labor demand are equally distributed.

In skill-based compensation plans, employees acquire depth skills when they learn self-management abilities, such as scheduling and organizing.

Additional Case 10.2 O'Donnell International is updating its job-based compensation system with a primary goal of achieving internal equity. Sean is responsible for gathering and organizing information concerning the tasks and duties of specific jobs. Susie is to determine the prerequisites for the successful accomplishment of each job analyzed. Jeff will work with three line managers to determine the compensable factors for specific lower-level jobs. The HR director, the president, and two VPs will review the information on management jobs in order to determine the compensable factors in each before putting all jobs at the firm into a job hierarchy. -Refer to Additional Case 10.2. Susie's responsibility most likely relates to:

When setting up a job-based pay plan, it is most likely important for a firm to: