Question 1

Which of the following bonus allocation methods best supports the philosophy of gain sharing?

Accepted Answer

A)  Everyone receives an equal share after minor adjustments are made for time worked. 
B)  Higher performers receive a greater share. 
C)  Higher-paid employees receive a greater share. 
D)  Part-time and newly hired employees receive nothing. 
A)  Everyone receives an equal share after minor adjustments are made for time worked. 
B)  Higher performers receive a greater share. 
C)  Higher-paid employees receive a greater share. 
D)  Part-time and newly hired employees receive nothing. A

Question 2

Which of the following statements regarding employee share purchase plans is NOT correct?

Accepted Answer

A)  Employees receive shares at no cost to themselves, usually as a bonus. 
B)  Employees provide a direct payment of some sort in exchange for the shares. 
C)  Often the price employees pay for the shares is less than market value. 
D)  Often employers will match the amount of shares purchased by the employee up to a set limit. 
A)  Employees receive shares at no cost to themselves, usually as a bonus. 
B)  Employees provide a direct payment of some sort in exchange for the shares. 
C)  Often the price employees pay for the shares is less than market value. 
D)  Often employers will match the amount of shares purchased by the employee up to a set limit. A

Question 3

Which of the following conditions makes a gain-sharing plan NOT viable and requires you to consider another option?

Accepted Answer

A)  No valid historical benchmark can be set. 
B)  Employee involvement is not an integral part of the system. 
C)  The plan involves large expenditures to implement. 
D)  Employees receive only 50 percent of the share. 
A)  No valid historical benchmark can be set. 
B)  Employee involvement is not an integral part of the system. 
C)  The plan involves large expenditures to implement. 
D)  Employees receive only 50 percent of the share. A

Question 4

A phantom stock plan ties an employee's bonus to the performance of company stock, but that employee never actually receives any stock.

Accepted Answer

A) True 
 B)False

Question 5

Improshare provides a ratio of labour hours per unit of output, generally based on metrics from the previous fiscal year.

Accepted Answer

A) True 
 B)False

Question 6

A group of farm workers normally pick 10,000 kilograms of cherries during a regular eight-hour shift. Joe, the operations manager, decides he will provide each picker in the group with a meaningful monetary reward if the farm workers are able to meet a new "stretch goal" of 12,500 kilograms per eight-hour shift? Which of the following terms best describes this new "stretch goal"?

Accepted Answer

A)  standard plus 
B)  goal plus 
C)  goal level 
D)  red circle plus 
A)  standard plus 
B)  goal plus 
C)  goal level 
D)  red circle plus

Question 7

According to research on Canadian firms, in the majority of cases, which employees are included in the profit-sharing plan?

Accepted Answer

A)  all full-time and part-time employees 
B)  non-unionized employees only 
C)  designated employees only 
D)  all full-time employees 
A)  all full-time and part-time employees 
B)  non-unionized employees only 
C)  designated employees only 
D)  all full-time employees

Question 8

Management decides to allocate 1,000 shares to a particular employee at a market value of $50.00 per share under a share appreciation rights plan. One year later, the value of these shares has increased to $65.00. How many shares would this employee actually receive as a bonus at the end of the year?

Accepted Answer

A)  15.4 shares 
B)  20 shares 
C)  230.8 shares 
D)  1,000 shares 
A)  15.4 shares 
B)  20 shares 
C)  230.8 shares 
D)  1,000 shares

Question 9

Human resource professionals have identified three types of goal-sharing plans. Which of the following is NOT one of those types?

Accepted Answer

A)  standard plus plans 
B)  single-goal plans 
C)  multi-goal plans 
D)  financially funded plans 
A)  standard plus plans 
B)  single-goal plans 
C)  multi-goal plans 
D)  financially funded plans

Question 10

As a medium-sized company owner, you believe that it is morally just that employees receive a portion of the profits they help generate, and you want to provide them with some form of pension plan. Which of the following types of plans should you consider using?

Accepted Answer

A)  deferred profit sharing 
B)  share appreciation rights 
C)  registered retirement savings 
D)  current distribution 
A)  deferred profit sharing 
B)  share appreciation rights 
C)  registered retirement savings 
D)  current distribution

Question 11

Which of the following would NOT be considered an advantage of the Scanlon plan, according to proponents?

Accepted Answer

A)  There is improved communication between management and employees. 
B)  It is a formal process to deal with work challenges. 
C)  Given that the need for consultation is absent, this is a quick program to implement. 
D)  All members of the gain-sharing plan tend to benefit from improvements. 
A)  There is improved communication between management and employees. 
B)  It is a formal process to deal with work challenges. 
C)  Given that the need for consultation is absent, this is a quick program to implement. 
D)  All members of the gain-sharing plan tend to benefit from improvements.

Question 12

A management report identified the following labour usage ratios for a window manufacturer in Richmond, British Columbia: 1.4 hours of labour per window in 2009; 1.25 hours of labour per window in 2010. Management makes the arbitrary decision to set next year's gain-sharing cutoff at 1.325 labour hours per window (the average of the 2010 and 2009 figures). Which of the following gain-sharing plans is management using?

Accepted Answer

A)  Scanlon plan 
B)  family of measures plan 
C)  Rucker plan 
D)  Improshare plan 
A)  Scanlon plan 
B)  family of measures plan 
C)  Rucker plan 
D)  Improshare plan

Question 13

The authors identified eight major issues that should be considered when designing a gain-sharing plan. Which of the following potential issues is NOT identified by the authors of the textbook?

Accepted Answer

A)  making a decision to include or exclude certain employees 
B)  making a decision on frequency of payouts 
C)  making a decision to use a fixed or discretionary plan 
D)  making a decision on how to communicate results 
A)  making a decision to include or exclude certain employees 
B)  making a decision on frequency of payouts 
C)  making a decision to use a fixed or discretionary plan 
D)  making a decision on how to communicate results

Question 14

Which of the following plans motivates employees to find ways to reduce the costs of raw materials or any other purchased inputs?

Accepted Answer

A)  Rucker 
B)  Scanlon 
C)  Improshare 
D)  combination profit sharing 
A)  Rucker 
B)  Scanlon 
C)  Improshare 
D)  combination profit sharing

Question 15

The Scanlon plan has changed over the years. A central reason for these changes is the notion that employees can reduce labour input as a function of output by increasing other costs.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following statements is NOT true?

Accepted Answer

A)  For motivational reasons, fixed formula profit-sharing plans are recommended. 
B)  Stock bonus plans provide employees with the right to purchase shares in the future at a fixed price. 
C)  Deciding the split is an important issue in gain-sharing plans. 
D)  A key issue in designing profit-sharing plans is the form of the bonus payout. 
A)  For motivational reasons, fixed formula profit-sharing plans are recommended. 
B)  Stock bonus plans provide employees with the right to purchase shares in the future at a fixed price. 
C)  Deciding the split is an important issue in gain-sharing plans. 
D)  A key issue in designing profit-sharing plans is the form of the bonus payout.

Question 17

Your company has decided to distribute a goal-sharing bonus according to the salary levels of employees. Which of the following would be a natural outcome of this decision?

Accepted Answer

A)  It discourages free riding by some employees. 
B)  It is the most egalitarian distribution method. 
C)  It maintains the same proportion of goal-sharing compensation in the compensation mix for all employees. 
D)  It adjusts for actual time worked during bonus period. 
A)  It discourages free riding by some employees. 
B)  It is the most egalitarian distribution method. 
C)  It maintains the same proportion of goal-sharing compensation in the compensation mix for all employees. 
D)  It adjusts for actual time worked during bonus period.

Question 18

Which of the following best explains a phantom stock plan?

Accepted Answer

A)  Although their bonus is tied to the performance of company stock, the employees never receive any stock. 
B)  Rewards are based on the stock performance of client firms. 
C)  Employees are awarded stock at no cost to themselves. 
D)  Employees can purchase stock at a fixed price within a set period of time. 
A)  Although their bonus is tied to the performance of company stock, the employees never receive any stock. 
B)  Rewards are based on the stock performance of client firms. 
C)  Employees are awarded stock at no cost to themselves. 
D)  Employees can purchase stock at a fixed price within a set period of time.

Question 19

Which of the following would you consider NOT to be "best practice" when designing nonmonetary reward plans?

Accepted Answer

A)  For large organizations, the usage of an elected committee of employees and managers should be considered when providing significant rewards to employees. 
B)  A champion or group of champions should be considered to keep the program "alive." 
C)  Whenever possible, reward only those employees in the top 10 percent. 
D)  Whenever possible, all deserving employees should be recognized. 
A)  For large organizations, the usage of an elected committee of employees and managers should be considered when providing significant rewards to employees. 
B)  A champion or group of champions should be considered to keep the program "alive." 
C)  Whenever possible, reward only those employees in the top 10 percent. 
D)  Whenever possible, all deserving employees should be recognized.

Question 20

Gain sharing is not a viable plan to use if no valid historical benchmark can be set.

Accepted Answer

A) True 
 B)False

Which of the following bonus allocation methods best supports the philosophy of gain sharing?

Which of the following statements regarding employee share purchase plans is NOT correct?

Which of the following conditions makes a gain-sharing plan NOT viable and requires you to consider another option?

A phantom stock plan ties an employee's bonus to the performance of company stock, but that employee never actually receives any stock.

Improshare provides a ratio of labour hours per unit of output, generally based on metrics from the previous fiscal year.

According to research on Canadian firms, in the majority of cases, which employees are included in the profit-sharing plan?

Human resource professionals have identified three types of goal-sharing plans. Which of the following is NOT one of those types?

As a medium-sized company owner, you believe that it is morally just that employees receive a portion of the profits they help generate, and you want to provide them with some form of pension plan. Which of the following types of plans should you consider using?

Which of the following would NOT be considered an advantage of the Scanlon plan, according to proponents?

The authors identified eight major issues that should be considered when designing a gain-sharing plan. Which of the following potential issues is NOT identified by the authors of the textbook?

Which of the following plans motivates employees to find ways to reduce the costs of raw materials or any other purchased inputs?

The Scanlon plan has changed over the years. A central reason for these changes is the notion that employees can reduce labour input as a function of output by increasing other costs.

Which of the following statements is NOT true?

Your company has decided to distribute a goal-sharing bonus according to the salary levels of employees. Which of the following would be a natural outcome of this decision?

Which of the following best explains a phantom stock plan?

Which of the following would you consider NOT to be "best practice" when designing nonmonetary reward plans?

Gain sharing is not a viable plan to use if no valid historical benchmark can be set.

A Road Map to Effective Compensation

A Strategic Framework for Compensation

A Behavioural Framework for Compensation

Components of Compensation Strategy

Performance Pay Choices

Formulating the Reward and Compensation Strategy

Evaluating Jobs: The Job Evaluation Process

Evaluating Jobs: The Point Method of Job Evaluation

Evaluating the Market

Evaluating Individuals

Designing Indirect Pay Plans

Activating and Maintaining an Effective Compensation System

Filters

Exam 11: Designing Performance Pay Plans

Which of the following bonus allocation methods best supports the philosophy of gain sharing?

Which of the following statements regarding employee share purchase plans is NOT correct?

Which of the following conditions makes a gain-sharing plan NOT viable and requires you to consider another option?

A phantom stock plan ties an employee's bonus to the performance of company stock, but that employee never actually receives any stock.

Improshare provides a ratio of labour hours per unit of output, generally based on metrics from the previous fiscal year.

According to research on Canadian firms, in the majority of cases, which employees are included in the profit-sharing plan?

Human resource professionals have identified three types of goal-sharing plans. Which of the following is NOT one of those types?

As a medium-sized company owner, you believe that it is morally just that employees receive a portion of the profits they help generate, and you want to provide them with some form of pension plan. Which of the following types of plans should you consider using?

Which of the following would NOT be considered an advantage of the Scanlon plan, according to proponents?

The authors identified eight major issues that should be considered when designing a gain-sharing plan. Which of the following potential issues is NOT identified by the authors of the textbook?

Which of the following plans motivates employees to find ways to reduce the costs of raw materials or any other purchased inputs?

The Scanlon plan has changed over the years. A central reason for these changes is the notion that employees can reduce labour input as a function of output by increasing other costs.

Which of the following statements is NOT true?

Your company has decided to distribute a goal-sharing bonus according to the salary levels of employees. Which of the following would be a natural outcome of this decision?

Which of the following best explains a phantom stock plan?

Which of the following would you consider NOT to be "best practice" when designing nonmonetary reward plans?

Gain sharing is not a viable plan to use if no valid historical benchmark can be set.

A Road Map to Effective Compensation

A Strategic Framework for Compensation

A Behavioural Framework for Compensation

Components of Compensation Strategy

Performance Pay Choices

Formulating the Reward and Compensation Strategy

Evaluating Jobs: The Job Evaluation Process

Evaluating Jobs: The Point Method of Job Evaluation

Evaluating the Market

Evaluating Individuals

Designing Indirect Pay Plans

Activating and Maintaining an Effective Compensation System

Filters