Question 1

The idea behind the Scanlon Plan is that employees should not only offer ideas to improve productivity, but should also be rewarded for those ideas.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following often applies to professional employees?

Accepted Answer

A)  They cannot advance in salary beyond a point without taking on administrative duties. 
B)  They cannot participate in profit-sharing plans. 
C)  They cannot own stock due to conflict of interest. 
D)  They can fully utilize their professional skills only after being promoted. 
A)  They cannot advance in salary beyond a point without taking on administrative duties. 
B)  They cannot participate in profit-sharing plans. 
C)  They cannot own stock due to conflict of interest. 
D)  They can fully utilize their professional skills only after being promoted.

Question 3

A bonus is supplemental to base wages.

Accepted Answer

A) True 
 B)False

Question 4

Employees receive a specified payment for each unit produced under a straight piecework program.

Accepted Answer

A) True 
 B)False

Question 5

Last year, many CEOs of Canada's largest companies earned less than $300,000 base pay, yet their overall compensation was on average more than $10 million. What was the major reason for the huge overall pay?

Accepted Answer

A)  executive perquisites 
B)  stock options 
C)  bonuses 
D)  benefits 
A)  executive perquisites 
B)  stock options 
C)  bonuses 
D)  benefits

Question 6

Merit pay plans have been criticized because the merit increase may not be sufficient to raise the employee's base pay.

Accepted Answer

A) True 
 B)False

Question 7

Where does the emphasis on stock options and executive stock ownership come from?

Accepted Answer

A)  executives' desire for deferred bonuses 
B)  shareholders' desire for dilution 
C)  competitive pressures to find creative ways to compensate executives 
D)  the desire of the company and investors for senior managers to have a stake in the success of the business 
A)  executives' desire for deferred bonuses 
B)  shareholders' desire for dilution 
C)  competitive pressures to find creative ways to compensate executives 
D)  the desire of the company and investors for senior managers to have a stake in the success of the business

Question 8

Incentive plans can create an organizational environment of "shared commitment," since individuals contribute to organizational success.

Accepted Answer

A) True 
 B)False

Question 9

At Steelcase, an office furniture maker, employees can earn more than their base pay if they produce more units, such as upholster more chairs. This part of their pay is determined on units produced. Which of the following plans is being used here?

Accepted Answer

A)  piece-rate plan 
B)  completion pay plan 
C)  time division plan 
D)  standard hour plan 
A)  piece-rate plan 
B)  completion pay plan 
C)  time division plan 
D)  standard hour plan

Question 10

Perquisites are special benefits given to executive employees.

Accepted Answer

A) True 
 B)False

Question 11

Merit raises may be perpetuated year after year even if performance declines.

Accepted Answer

A) True 
 B)False

Question 12

Several organizations have an incentive that managers can give to their employees for outstanding singular effort not tied to any planned performance standard. What is such an incentive usually called?

Accepted Answer

A)  a stock option 
B)  a spot bonus 
C)  merit pay 
D)  a differential piece rate 
A)  a stock option 
B)  a spot bonus 
C)  merit pay 
D)  a differential piece rate

Question 13

Gainsharing plans are designed to improve productivity through more effective use of organizational resources.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is NOT a problem with merit raises?

Accepted Answer

A)  Employees expect the raise even when performance declines. 
B)  Employees do not trust management. 
C)  The raise may be based on favouritism. 
D)  The raise may be based on achieving an objective standard. 
A)  Employees expect the raise even when performance declines. 
B)  Employees do not trust management. 
C)  The raise may be based on favouritism. 
D)  The raise may be based on achieving an objective standard.

Question 15

A new start-up firm wants to encourage team behaviours and a "culture of ownership" among all employees in the organization. Which of the following pay plans would you advise against?

Accepted Answer

A)  profit sharing 
B)  stock options 
C)  differential piece rates 
D)  employee stock ownership plans 
A)  profit sharing 
B)  stock options 
C)  differential piece rates 
D)  employee stock ownership plans

Question 16

Employees working under a standard hour plan are paid on the basis of a predetermined time allowed to finish the job.

Accepted Answer

A) True 
 B)False

Question 17

Performance measures are rather simple to develop and standardize, as sales volume is an objective measure of performance that is not dependent upon external factors.

Accepted Answer

A) True 
 B)False

Question 18

Differential piece rate plans guarantee employees at least a base pay.

Accepted Answer

A) True 
 B)False

Question 19

The level of incentives given to executives may depend on their level in the firm.

Accepted Answer

A) True 
 B)False

Question 20

A straight salary plan is the most frequently used type of sales incentive plan.

Accepted Answer

A) True 
 B)False

The idea behind the Scanlon Plan is that employees should not only offer ideas to improve productivity, but should also be rewarded for those ideas.

Which of the following often applies to professional employees?

A bonus is supplemental to base wages.

Employees receive a specified payment for each unit produced under a straight piecework program.

Last year, many CEOs of Canada's largest companies earned less than $300,000 base pay, yet their overall compensation was on average more than $10 million. What was the major reason for the huge overall pay?

Merit pay plans have been criticized because the merit increase may not be sufficient to raise the employee's base pay.

Where does the emphasis on stock options and executive stock ownership come from?

Incentive plans can create an organizational environment of "shared commitment," since individuals contribute to organizational success.

At Steelcase, an office furniture maker, employees can earn more than their base pay if they produce more units, such as upholster more chairs. This part of their pay is determined on units produced. Which of the following plans is being used here?

Perquisites are special benefits given to executive employees.

Merit raises may be perpetuated year after year even if performance declines.

Several organizations have an incentive that managers can give to their employees for outstanding singular effort not tied to any planned performance standard. What is such an incentive usually called?

Gainsharing plans are designed to improve productivity through more effective use of organizational resources.

Which of the following is NOT a problem with merit raises?

A new start-up firm wants to encourage team behaviours and a "culture of ownership" among all employees in the organization. Which of the following pay plans would you advise against?

Employees working under a standard hour plan are paid on the basis of a predetermined time allowed to finish the job.

Performance measures are rather simple to develop and standardize, as sales volume is an objective measure of performance that is not dependent upon external factors.

Differential piece rate plans guarantee employees at least a base pay.

The level of incentives given to executives may depend on their level in the firm.

A straight salary plan is the most frequently used type of sales incentive plan.

The World of Human Resources Management

Strategy and Human Resources Planning

Equity and Diversity in Human Resources Management

Job Analysis, Employee Involvement, and Flexible Work Schedules

Expanding the Talent Pool: Recruitment and Careers

Employee Selection

Training and Development

Appraising and Improving Performance

Managing Compensation

Employee Benefits

Safety and Health

Employee Rights and Discipline

The Dynamics of Labour Relations

International Human Resources Management

Creating High Performance Work Systems

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Exam 10: Pay For Performance: Incentive Rewards

The idea behind the Scanlon Plan is that employees should not only offer ideas to improve productivity, but should also be rewarded for those ideas.

Which of the following often applies to professional employees?

A bonus is supplemental to base wages.

Employees receive a specified payment for each unit produced under a straight piecework program.

Last year, many CEOs of Canada's largest companies earned less than $300,000 base pay, yet their overall compensation was on average more than $10 million. What was the major reason for the huge overall pay?

Merit pay plans have been criticized because the merit increase may not be sufficient to raise the employee's base pay.

Where does the emphasis on stock options and executive stock ownership come from?

Incentive plans can create an organizational environment of "shared commitment," since individuals contribute to organizational success.

At Steelcase, an office furniture maker, employees can earn more than their base pay if they produce more units, such as upholster more chairs. This part of their pay is determined on units produced. Which of the following plans is being used here?

Perquisites are special benefits given to executive employees.

Merit raises may be perpetuated year after year even if performance declines.

Several organizations have an incentive that managers can give to their employees for outstanding singular effort not tied to any planned performance standard. What is such an incentive usually called?

Gainsharing plans are designed to improve productivity through more effective use of organizational resources.

Which of the following is NOT a problem with merit raises?

A new start-up firm wants to encourage team behaviours and a "culture of ownership" among all employees in the organization. Which of the following pay plans would you advise against?

Employees working under a standard hour plan are paid on the basis of a predetermined time allowed to finish the job.

Performance measures are rather simple to develop and standardize, as sales volume is an objective measure of performance that is not dependent upon external factors.

Differential piece rate plans guarantee employees at least a base pay.

The level of incentives given to executives may depend on their level in the firm.

A straight salary plan is the most frequently used type of sales incentive plan.

The World of Human Resources Management

Strategy and Human Resources Planning

Equity and Diversity in Human Resources Management

Job Analysis, Employee Involvement, and Flexible Work Schedules

Expanding the Talent Pool: Recruitment and Careers

Employee Selection

Training and Development

Appraising and Improving Performance

Managing Compensation

Employee Benefits

Safety and Health

Employee Rights and Discipline

The Dynamics of Labour Relations

International Human Resources Management

Creating High Performance Work Systems

Filters