Exam 10: Compensation Strategies and Practices

Broadbanding is most appropriate in a traditional, hierarchical organization where the managers have careers based on steady advancement and promotions.

It has been proven that a more open pay system has positive effects on employee retention and organizational effectiveness.

The Provincial Employment Standards Acts set minimum wage standards and hours of work for all employees in the private sector.

An increasing number of organizations are keeping pay information secret, thus avoiding disputes and lawsuits about pay fairness.

Companies generally adapt the same compensation strategies for each of their employee groups.

Which of the following explains why organizations use pay grades while establishing a pay structure?

An advantage of market pricing is that employees view it as having high face validity.

You are considering employees who can be described in the following ways. According to a typical pay adjustment matrix, which combination of factors will result in the largest pay raise?

Pay compression occurs when the range of pay differences among individuals with different levels of experience and performance in the organization becomes small.

Abundance Nurseries needs large numbers of unskilled employees every spring and summer to plant, maintain, and harvest the flower fields. Abundance Nurseries is located in an area where there is a large supply of unskilled workers, and it has few problems recruiting workers as needed. Which quartile approach to compensation strategy would be most reasonable for Abundance Nurseries to use?

Which of the following is the last step in establishing a pay structure?

Organizations may have specifically stated policies about where they wish to be positioned in the labour market. If so, which of the following have they adopted as a strategy?

Functional expertise would be classified as a subfactor of the know how factor in the Hay system of job evaluation.

Which of the following terms encompasses the base pay, variable pay, and benefits that someone receives from a job?

Which of the following is a major drawback to the point method of job evaluation?

When employees and outsiders consider an organization's compensation as lacking in external equity, what is a likely outcome?

Michael is the vice president of manufacturing for a textile firm that is opening up a plant in India. Michael must decide how to pay the hourly workers in the Indian plant. After much consultation with his peers at other companies, he decides to follow a common practice. Which of the following options is it most likely to be?

If the pay of a significant number of employees falls outside the pay ranges drafted as part of constructing new pay grades and ranges, then which response is the most appropriate to make?

Amber is the manager of a popular clothing store. She regularly works over 40 hours a week. When new styles are coming in requiring new displays, she may put in as many as 60 hours a week. Regardless of the number of hours she has worked, Amber's paycheque is the same. Which of the following identifies how Amber's pay is determined?

A green-circled employee is an incumbent who is paid above the range set for the job.