Deck 9: Discretionary Benefits

Question 1

The XYZ Company tries to influence employee food choices by stocking vending machines with l healthy food.They also offer programs to teach stress reduction techniques.Which kind of discretionary benefit program does this company sponsor?

A)family assistance program
B)employee assistance program
C)wellness program
D)employer assistance program

Answer 1

C

Question 2

Which type of plan appeared as one of the first discretionary benefits practices?

A)wellness plans
B)employee discounts
C)educational assistance
D)retirement plans

Answer 2

D

Question 3

Which of the following would be considered part of a company's wellness program?

A)putting a soda machine in the break room
B)giving out cigars to expecting fathers
C)offering anti-smoking courses
D)giving employees free pizza at lunch

Answer 3

C

Question 4

Which of the following benefits was previously offered on a discretionary basis,but,is now mandatory?

A)health insurance
B)retirement plans
C)paid time off
D)employee assistance programs

Question 5

Which of the following is the most common type of life insurance policy offered by companies?

A)group life
B)term life
C)whole life
D)universal

Question 6

A 401(k)plan is which of the following types of retirement benefits?

A)defined contribution
B)defined benefit
C)qualified benefit
D)nonqualified benefit

Question 7

Outplacement assistance programs are best suited for which condition?

A)new plant openings
B)mergers and acquisitions
C)workforce increases
D)global operations

Question 8

Due to a recent merger with another major airline,ABC Airlines decided to lay off some of its employees.ABC Airlines offers training sessions to teach job search and interviewing techniques to those laid off employees.Which kind of service was provided by this airline?

A)employee assistance program
B)tuition reimbursement
C)wellness program
D)outplacement assistance

Question 9

Which of the following contributed to the use of flexible benefits plans?

A)greater workforce diversity
B)cost savings initiatives
C)unions
D)global competition

Question 10

In response to government-imposed wage freezes,many companies began offering ________ as an alternative to motivate employees through greater work benefits.

Question 11

Which of the following is associated with Roth 401(k)plans?

A)Employees pay taxes on their contribution.
B)Employees do not pay taxes on their contributions.
C)Investment gains are taxed.
D)Employees can deduct their contributions from post taxable income.

Question 12

You broke your neck at work.The company called to inform you that they had to switch your benefits from the short-term disability account to the long-term disability account.Based on this decision,how long have you been off work?

A)at least 3 to 6 months
B)at least 1 to 2 months
C)12 months
D)18 months

Question 13

What type of pension plan commonly includes profit-sharing plans,stock bonus plans,and employee stock ownership plans?

A)defined benefit
B)defined contribution
C)deferred contribution
D)deferred benefit

Question 14

In 2014,approximately what percentages of private-sector employees and government employees,respectively,had access to an EAP?

A)24 percent, 94 percent
B)39 percent, 54 percent
C)54 percent, 74 percent
D)74 percent, 39 percent

Question 15

Which government action contributed to the use of welfare benefits?

A)the passage of the National Labor Relations Act
B)the passage of the Social Security Act
C)wage freezes
D)recovery from economic depression

Question 16

What are the implications of discretionary benefits for strategic compensation?

Question 17

The XYZ Company provides a program for its employees who need help dealing with the effects of domestic violence.The XYZ Company can offer this kind of service through which of the following programs?

A)family assistance program
B)employee assistance program
C)wellness program
D)employer assistance program

Question 18

These represent a series of payments for the life of the participant and beneficiary.

A)collateral payments
B)periodic payments
C)lump sum distributions
D)annuities

Question 19

Unscheduled absenteeism has climbed to its highest levels in the XYZ Company last month.In order to reduce costs,HR professionals in the XYZ Company changed their paid time off policy.This company used to grant each employee 10 vacation days,5 paid days for sick leave,and 4 days for personal leave.With the new policy,this company combines vacation,sick leave,and personal leave policies into one paid time off policy (i.e.,19 days).The management kept funeral leave as a stand-alone policy.What is the XYZ Company's new policy called?

A)integrated paid time off
B)combined paid time off
C)sabbatical leave
D)volunteer leave

Question 20

Which of the following is a commonly used employer-sponsored retirement plan design?

A)defined contribution
B)qualified contribution
C)Roth IRA
D)IRA

Question 21

________ help bring employees to the workplace and back home again.

Question 22

Which of the following is NOT a provision of the Employee Retirement Income Security Act?

A)vesting rights
B)fiduciary responsibilities
C)employer matching contributions
D)reporting and disclosure duties

Question 23

An ________ refers to the minimum amount of time that an employee must wait after becoming disabled before disability insurance payments begin.

Question 24

The ________ is the U.S.tax code.

Question 25

Distinguish between qualified and nonqualified retirement plans.

Question 26

Define three types of life insurance.

Question 27

Since the costs of benefits has risen so dramatically in recent years,the majority of the companies decided to finance discretionary benefits using which of the following methods?

A)noncontributory financing
B)contributory financing
C)employee-financed benefits
D)employer-financed benefits

Question 28

________ are career and personal programs designed to develop the job-hunting skills and strategies of employees being laid off or terminated.

Question 29

Retirement programs,or ________,provide income in the form of an annuity to employees and their beneficiaries during some or all of their retirement.

Question 30

How are integrated paid time off policies different than holiday,vacation,sick leave,and personal leave policies?

Question 31

Mary works at a pharmaceutical company as a customer service representative.Her employer allows her to choose the set of benefits she will receive on top of preestablished sets of benefits,such as medical insurance and term life insurance.The company gave her credits equal to 6% of her salary with which she decided to purchase dental and vision insurance.This pharmaceutical company uses what kind of benefits plan?

A)cafeteria
B)flexible benefits
C)employee-financed
D)core plus option

Question 32

Which of the following laws permit employers to automatically enroll employees in a defined contribution plan?

A)Consolidated Omnibus Reconciliation Act
B)Employee Retirement Income Security Act
C)Pension Protection Act
D)Internal Revenue Code

Question 33

IRS guidelines define ________ plans as "defined benefit plans that define benefits for each employee by reference to the amount of the employee's hypothetical account balance."

Question 34

Effective employee benefits communications programs can help reduce which of the following?

A)an appreciation of benefits
B)increased flexibility
C)costs
D)an entitlement mentality

Question 35

Which set of rules prohibit employers from discriminating in favor of highly compensated employees in contributions or benefits,availability of benefits,rights,or plan features?

A)Equal Pay Act
B)vesting rules
C)nondiscrimination rules
D)participation rules

Question 36

________ rights refer to nonforfeitable rights to retirement benefits.

Question 37

Under a cliff vesting arrangement,after how many years must full vesting rights be granted?

A)1
B)3
C)5
D)7

Question 38

401(k)and 403(b)plans are examples of ________ plans.

Question 39

Under which type of plan may employees exercise the option of trading extra benefits credits for cash?

A)cafeteria benefits plans
B)core plus option plans
C)flexible spending accounts
D)defined contribution plans

Question 40

Which of the following do qualified plans provide?

A)matching contributions to defined contribution plans
B)substantial tax breaks to employers and employees
C)substantial tax breaks to employees
D)matching contributions to defined benefit plans

Question 41

Which of the following could undermine competitive advantage?

A)basing employee benefits awards based on performance
B)offering flexible benefits plans
C)offering employee benefits as an entitlement
D)offering employee benefits following the completion of a lengthy probationary period

Question 42

Which of the following is rationale to apply a probationary period prior to permitting participation in an employee benefits plan?

A)Companies view such periods as an opportunity to ensure that they have made sound hiring decisions.
B)Companies enable new employees to decide whether they wish to remain employed on a long-term basis before completing extensive paperwork.
C)Companies attempt to reduce employee entitlement.
D)Companies attempt to discourage long-term employment.

Question 43

The tax advantage afforded companies from offering particular discretionary benefits has strategic value for which of the following reasons?

A)It translates into cost savings to companies.
B)It may adversely undercut company profits.
C)It helps companies retain talented employees.
D)It may lead to a decrease in the number of benefits a company chooses to offer.

Question 44

When employees take advantage of ________ benefits,they are more likely to contribute to the strategic imperatives of product or service differentiation or cost reduction.