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Some employees at Opal Coin, a clothing manufacturer, investigate pay rates on Salary.com and learn that Opal Coin has been paying them significantly more than the national average for their jobs. In this case, what is the most likely reaction of the employees at Opal Coin?


A) The employees will conclude that there must be regional differences in pay.
B) The employees will be motivated to work much harder.
C) The employees will find their jobs less challenging.
D) The employees will find a way to increase their outcomes by stealing.
E) The employees' attitudes and behaviors will continue unchanged.

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Issues affecting an organization's pay structure do not affect its reputation in general.

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Which element establishes an organization's pay structure?


A) pay ranges and pay differentials
B) cost control and equity
C) legal requirements and job descriptions
D) individual salaries of its employees
E) job structure and pay level

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List three limitations of using a job-based pay structure.

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Some of the limitations of job-based pay...

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What is a drawback of a minimum wage in terms of social policy?


A) It assumes people will take differences in pay into account when they choose a career.
B) It is one and a half times the employee's usual hourly rate.
C) It applies only to the hours worked beyond 40 in one week.
D) It places the employer at an economic disadvantage relative to employers that pay the living wage.
E) It tends to be lower than the earnings required for a full-time worker to rise above the poverty level.

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What is an advantage of a two-tier wage system?


A) It helps move jobs out of the country.
B) It helps eliminate jobs without any legal hassles.
C) It helps reduce labor costs without cutting employees' existing salaries.
D) It helps provide more pay to new employees.
E) It provides better standards for benchmarking.

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Under the FLSA, exempt status of employees depends on their


A) job responsibilities and salary.
B) organizational commitment.
C) job title.
D) work experience.
E) job qualifications.

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Ring Associates, an insurance company, defines the difference in pay between an entry-level recruiter and an entry-level assembler, as well as the difference between an entry-level recruiter, an HR manager, and the vice president of the human resource department. What is being exemplified in this scenario?


A) straight piecework plan
B) job structure
C) merit pay system
D) pay differential
E) balanced scorecard

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Compa-ratio


A) is defined as the ratio of average pay to the midpoint of the pay range.
B) is defined as the ratio of the average pay for the grade divided by the minimum pay for the grade.
C) can range from 0 to 100 percent.
D) uses data from market-pay surveys.
E) measures the degree to which new skills learned are consistent with the increases in pay.

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Which statement is true of equal employment opportunity laws?


A) These laws guarantee equal pay for whites and minorities.
B) The goal of these laws is for employers to provide equal pay for equal work.
C) Job descriptions and job structures cannot help organizations demonstrate that they are upholding these laws.
D) These laws guarantee equal pay for men and women.
E) Under these laws, employers cannot tie differences in pay to business-related considerations.

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Employees' conclusions about equity depend on


A) what they choose as a standard of comparison.
B) how much money they think the company CEO makes.
C) what level of income they believe they should be at by this point in their lives.
D) what benefits they receive.
E) if they think they can bargain for a higher rate of pay.

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According to ________, people measure outcomes such as pay in terms of their inputs.


A) expectancy theory
B) equity theory
C) retributive justice theory
D) progressive justice theory
E) economic theory

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Quey Inc., a construction company, receives more than $2,000 in federal money. The company pays its employees at rates at least equal to the prevailing wages in the area. The calculation of prevailing rates by the company is based on 30 percent of the local labor force. In this case, which law does the company comply with?


A) the Lloyd-La Follette Act of 1912
B) the Smith-Connally Act of 1943
C) the Julie Jargon Act of 1940 and the Eric Morath Act of 1945
D) the Davis-Bacon Act of 1931 and the Walsh-Healy Public Contracts Act of 1936
E) the Humphrey-Hawkins Full Employment Act

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Organizations use pay surveys to benchmark compensation.

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Willow Producers is a manufacturing company based in Iowa. The employees of Willow Products are paid the lowest amount under federal or state law, which is stated as an amount of pay per hour. Which law is the organization abiding by in this scenario?


A) laws governing equal employment opportunity
B) Fair Labor Standards Act (FLSA) of minimum wage
C) Fair Labor Standards Act (FLSA) of overtime
D) laws governing prevailing wages
E) product market laws

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Fresher Inc. is a whole-foods distributor. Its human resource department gathers the following data for computing compa-ratios of some positions. Based on the data, for which position is Fresher Inc. most likely underpaying for human resources?


A) shipping clerks: average salary of $22,000, range midpoint of $24,000
B) inventory clerks: average salary of $20,000, range midpoint of $30,000
C) order packers: average salary of $24,000, range midpoint of $22,000
D) purchasing agents: average salary of $30,000, range midpoint of $25,000
E) warehouse workers: average salary of $20,000, range midpoint of $20,000

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Skill-based pay systems do not support empowerment of employees.

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In a two-tier wage system, employees doing the same job are paid two different rates, depending on their technical background and training.

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What is a characteristic of delayering?


A) It increases an organization's flexibility.
B) It increases the opportunities for promoting employees.
C) It sets pay according to the employees' level of knowledge.
D) It encourages a climate of learning.
E) It decreases the flexibility of managers in making assignments.

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What is a pay policy line? What is its relevance?

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Mathematically, a pay policy line shows ...

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