Deck 9: Managing Compensation

Question 1

The expectancy theory of motivation predicts that one's level of motivation depends on the attractiveness of the rewards sought by employees and the probability of obtaining those rewards.

Answer 1

True

Question 2

An advantage of published wage surveys is compatibility with the organization's jobs.

Answer 2

False

Question 3

Executives,administrators,and professional employees are exempt from overtime payments identified in employment standards acts.

Answer 3

True

Question 4

Steps within a rate range allow pay increases based on merit or seniority or a combination of the two.

Question 5

Internal factors that influence wage rates include the worth of a job,and the employer's ability to pay.

Question 6

A wage curve represents the relationship between the relative worth of jobs and their wage rates.

Question 7

When employees are paid according to the skills and knowledge they have rather than the specific jobs they perform,they are paid according to competence-based compensation.

Question 8

HR professionals establish predetermined wage grades as a basis for evaluating jobs in the job classification system of job evaluation.

Question 9

Wages paid above the range maximum are called blue square rates.

Question 10

Compensable factors include skills,effort,responsibilities,and working conditions.

Question 11

Wage-rate compression commonly occurs when organizations grant pay adjustments to lower-rated jobs but do not extend the adjustments up the hierarchy.

Question 12

The consumer price index tracks the change in price over time of a "market basket" of goods and services.

Question 13

Employees who earn pay for hourly work are referred to as salaried employees.

Question 14

Pay equity is achieved when employees' compensation is equal to the value of the work they perform.

Question 15

The job classification system is commonly used by smaller employers.

Question 16

Among the goals of strategic compensation policy are rewarding past performance,attracting new employees,and reducing turnover.

Question 17

To provide compensation estimates and ranges for jobs in an organization,all jobs should be surveyed.

Question 18

Competence-based pay systems represent a fundamental change in the attitude of
management regarding how work should be organized and how employees should be
paid for their work efforts.

Question 19

The employment standards acts set minimum requirements with respect to wages,hours of work,and overtime.

Question 20

The use of job evaluation is widespread in the private sector but is rarely used in the public sector.

Question 21

Equal pay for work of equal value involves providing equal pay to women when they perform work historically performed by men.

Question 22

Indirect compensation includes bonuses and commissions.

Question 23

Wage-rate compression refers to the situation where employees perceive that there is too large a difference between their compensation and that of colleagues in higher-rated jobs.

Question 24

Labour market conditions have little impact on wage rates paid to employees.

Question 25

Rewarding an employee's past performance is a goal of strategic compensation policy.

Question 26

Expectancy theory predicts that people expect to be paid as much or more than individuals in a similar job class.

Question 27

Job ranking is a simple method that provides a precise measure of each job's worth.

Question 28

The Hay profile method is useful for evaluating jobs of all types and levels.

Question 29

Wage compression can be avoided by granting wage increases solely on the basis of the CPI.

Question 30

The jobs that are included in wage and salary surveys are referred to as "key jobs."

Question 31

Wage survey data can be obtained from government sources,trade associations,or professional groups,or organizations can conduct their own surveys.

Question 32

Using job evaluation and wage survey data jointly improves the likelihood of both internal and external equity.

Question 33

Broadbanding refers to collapsing many traditional salary grades into a few wide salary bands.

Question 34

A point manual can be used to determine the external equity of a job.

Question 35

When an employer operates in more than one province,it has to apply only the employment requirements of one province of its choosing.

Question 36

Pay levels are limited in part by profitability of the firm and productivity of employees.

Question 37

Granting wage increases solely on the basis of the CPI helps compress pay rates within a pay structure,thereby ensuring equity among those who receive the wage increase.

Question 38

Broadbands create more concern by employees with pay grades and steps.

Question 39

Managers will group similar jobs into a pay grade in order to help with the setting of wages for all jobs.

Question 40

Competence-based pay systems compensate employees for the different skills or knowledge they possess rather than for the job they hold in a designated job category.

Question 41

Organizations may dodge the comparable worth issue by using one job evaluation system for clerical jobs frequently held by women,and another system for other jobs.

Question 42

For real wages to increase,what is necessary?

A)An employee's wage increase must be greater than the increase in the CPI.
B)An employee must receive a lump-sum wage increase equal to the increase in the CPI.
C)An employee's wage must simply increase.
D)The CPI must increase at least as much as the employee's wage.

Question 43

Which of the following is NOT a potential outcome of wage-rate compression?

A)decreased employee performance
B)low employee morale
C)delinquent employee behaviour
D)lower absenteeism

Question 44

Job evaluation is a non-systematic,qualitative process of determining the relative worth of jobs in order to establish a comparison with the prevailing market and regional value of a job within a job family.

Question 45

Which type of legislation is concerned with minimum wage rates and overtime payments?

A)employment standards
B)employment equity
C)equal pay
D)pay equity

Question 46

Real wages represent the difference between wage increases and cost-of-living increases.

Question 47

Vidya works at Paymore Shoes and is paid for time she works in the store.How would you classify Vidya?

A)a salaried employee
B)an hourly employee
C)an exploited employee
D)a white-collar employee

Question 48

According to the textbook,which job evaluation method is considered the most valid?

A)job ranking
B)the classification method
C)the point method
D)the factor comparison method

Question 49

Jambrone Foods and CUPE Local 5000 have a collective agreement in place that allows for wages to be paid at more than the minimum wage set by the Employment Standards Act.Which of the following best describes this agreement?

A)It is illegal.
B)It is legal.
C)It is legal but ill-advised.
D)It is acceptable under the Employment Standards Act but illegal under the Canada Labour Code.

Question 50

The point system of job evaluation permits jobs to be evaluated quantitatively based on compensable factors.

Question 51

Pay equity is covered only under federal jurisdiction.

Question 52

When time off is given in exchange for overtime work,it must be given hour-for-hour to the number of hours worked overtime.

Question 53

An advantage of competence-based pay from the employee's perspective is that there is no limit to what they can earn by learning new skills.

Question 54

Pay equity legislation is administered at what jurisdictional level?

A)international
B)federal
C)provincial
D)municipal

Question 55

ABC Corporation uses a job evaluation system that links the value of jobs directly with the goals of the organization.Which job evaluation system is most likely being used by ABC Corporation?

A)work evaluation
B)goal setting
C)point method
D)goal system

Question 56

Strategic compensation is the compensation of employees in ways that enhance motivation and growth while concurrently aligning their efforts with the goals of the organization.

Question 57

In developing a wage curve,what are market wage rates plotted against?

A)job evaluation points
B)employee benefits
C)the size of a firm
D)employee wages and salaries

Question 58

Some organizations can choose a strategy to pay higher than market wages and salaries.Which of the following will this likely help them do?

A)be more selective in their employee hiring
B)reduce their direct labour costs
C)reduce their indirect labour costs
D)achieve pay equity between men and women

Question 59

Which term refers to the concept of equal pay for work of equal value?

A)equal pay
B)comparable pay
C)compensable factor
D)pay equity

Question 60

Which of the following is an external factor that can influence the rates at which employees are paid?

A)collective bargaining
B)the employer's ability to pay
C)the employees' relative worth
D)the worth of the job

Question 61

Wage compression may create problems related to which of the following?

A)external equity
B)internal equity
C)gender discrimination
D)racial discrimination

Question 62

Tiffany works as an IT specialist at Nortel.She is compensated based on such skills as programming and service to clients.It is likely that she is paid under which of the following pay plans?

A)a competency-based pay plan
B)a performance-based pay plan
C)a merit-based pay plan
D)a seniority-based pay plan

Question 63

What is the scope of the impacts of collective bargaining agreements?

A)They extend beyond the segment of the labour force that is unionized.
B)They are restricted to hourly employees only.
C)They are restricted to members of the union.
D)They are restricted to both exempt and non-exempt employees.

Question 64

Desirée is a female receptionist employed by York University in Toronto.John is a male janitor with the same employer.Both jobs are evaluated as having 500 points,yet Desiree is paid less than John.She has decided to legally challenge the employer.Which of the following is relevant in this case?

A)the Peter principle
B)market matching
C)equal pay for work of equal value
D)equal pay for equal work

Question 65

What do we call jobs that are selected to be included in salary surveys?

A)higher-pay jobs
B)equity jobs
C)comparison jobs
D)benchmark jobs

Question 66

ABC Corporation is a furniture firm based in Ontario that supplies its products to the federal government.What laws would apply to ABC Corporation?

A)federal and provincial laws
B)federal laws only
C)provincial laws only
D)international laws only

Question 67

Which of the following is NOT a method of comparison used in job evaluation?

A)point system
B)job ranking system
C)job classification system
D)comparable worth system

Question 68

In collective agreements,what are escalator clauses associated with?

A)predetermined fixed increases in pay year-over-year
B)a cost of living adjustment
C)job evaluations
D)succession planning

Question 69

In geography,the water catchment area or watershed refers to the area that channels or supplies a specific area with its water.Catchment areas divide drainage basins.In wage surveys,what is this catchment area similar to?

A)the labour market
B)the region
C)the recruiting area
D)the supply region

Question 70

How would you describe "an increase in real wages"?

A)an increase in wages over the Consumer Price Index
B)an increase in wages and benefits
C)an increase in the monetary proportion of the compensation package
D)an increase in collectively bargained wages

Question 71

Both Sam and Samantha work as cashiers at Modelo Hot Dogs.They do work of equal value to the firm,yet Sam receives less pay than Samantha.Sam is not happy because he perceives the system as being unfair to him.Which theory can you use to explain Sam's perceptions?

A)reverse discrimination theory
B)pay equity theory
C)expectancy theory
D)equity theory

Question 72

To help achieve internal equity,factors such as skills,effort,responsibilities,and working conditions may be used to assess jobs.What do we call these factors?

A)job specifications
B)job classification factors
C)compensable factors
D)factor comparisons

Question 73

Which of the following clauses are found in some labour agreements that periodically adjust compensation rates to reflect increases in cost of living?

A)maintenance clauses
B)escalator clauses
C)roll-up clauses
D)guarantee clauses

Question 74

Which of the following terms is also used to describe competency-based pay?

A)incentive pay
B)commission pay
C)skilled-based pay
D)broadband pay

Question 75

What is a key implication of expectancy theory when applied to pay systems?

A)Employees must get pay raises to cover increased living costs.
B)Employees expect their managers to be competent.
C)Employers expect their employees to be competent.
D)Rewards must be valuable for motivation to occur.

Question 76

Which of the following issues does job evaluation helps to address?

A)issues dealing with employees' need for pay that is equal to their financial needs
B)issues dealing with employers' perceptions of the labour market
C)issues dealing with employers' need to match the market pay
D)issues dealing with employees' perceptions of equity

Question 77

Which of the following is a firm's internal factor that can influence the rates at which employees are paid?

A)labour market conditions
B)collective bargaining
C)the cost of living
D)the employer's strategy

Question 78

Which of the following is the simplest job evaluation system?

A)job ranking
B)point method
C)job classification
D)work valuation

Question 79

What types of jobs are usually evaluated using the Hay profile method?

A)executive and managerial
B)administrative and technical
C)information technology and manufacturing
D)sales and accounting

Question 80

Which of the following is a relatively new job evaluation system?

A)job classification system
B)job ranking
C)the point system
D)work evaluation