CEBS - GBA 1 Module 1 Exam Questions
With Correct Answers
1.1 |Distinguish |between |the |broad |view |and |the |narrow |view |of |employee |benefits |- |
ANSWER✔✔✔-The |broad |view |defines |employee |benefits |as |anything |other |than |direct |
compensation, |including |both |government-mandated |benefits |and |private |plans. |(social |
security, |pension |plans |etc.). |The |narrow |view |holds |that |employee |benefits |are |any |benefit |
sponsored |unilaterally |or |jointly |by |employers |and |employees |that |is |not |subsidized |by |the |
government.
1.2 |List |the |categories |of |benefits |that |generally |are |considered |to |fall |under |a |broad |view |
employee |benefits |- |ANSWER✔✔✔-• |Legally |required |benefits |(Social |Security)
• |Payment |for |time |not |worked |(rest, |lunch, |vacation, |and |holidays)
• |Medical
• |Retirement |& |savings |plan |payments
• |Miscellaneous |benefits |(employee |discounts, |severance |pay, |education, |and |child |care)
1.3 |What |benefits |are |typically |excluded |when |the |term |"employee |benefits" |is |viewed |and |
defined |in |a |narrow |sense? |- |ANSWER✔✔✔-Those |that |are |legally |mandated |(Social |Security |
and |workers' |compensation)
2.1 |Explain |the |types |of |businesses- |or |human |resource-related |reasons |for |firms |establishing |
employee |benefit |plans |- |ANSWER✔✔✔-So |businesses |may |attract |& |retain |capable |
employees. |Good |benefit |plans |foster |corporate |efficiency, |productivity, |and |improve |
employee |morale.
2.2 |What |impact |have |labor |unions |historically |had |in |employee |benefits? |- |ANSWER✔✔✔-
Through |the |practice |of |collective |bargaining |labor |unions |have |had |an |impact |on |the |growth |
, of |employee |benefit |plans. |In |1948 |the |NLRB |ruled |in |the |Inland |Steel |case |that |the |duty |to |
bargain |in |good |faith |over |wages |also |included |insurance |and |fringes |such |as |pension |benefits.
|Following |that, |in |the |W.W. |Cross |& |Co. |case, |the |NLRB |ruled |that |wages |included |health |and |
accident |plan.
2.3 |Explain |the |significance |of |the |Taft-Hartley |Act |in |employee |benefit |planning. |- |
ANSWER✔✔✔-The |Labor-Management |Relations |Act, |also |called |the |Taft-Hartley |Act, |sets |
forth |the |framework |for |good-faith |collective |bargaining |over |wages, |hours, |conditions |and |
terms |of |employment |and |employee |benefits. |It |established |the |distinction |between |
retirement |benefits |and |welfare |benefits. |It |also |provides |framework |for |administration |of |
those |benefits. |It's |the |legal |basis |on |which |jointly |trusteed |benefit |plans |are |founded.
2.4 |Summarize |three |major |federal |tax |advantages |associated |with |employee |benefit |plans. |- |
ANSWER✔✔✔-• |Most |contributions |are |deductible |as |long |as |they |are |reasonable |business |
expenses
• |Within |limits, |the |contributions |are |not |considered |income |to |employees
• |In |certain |retirement/capital |plans, |benefits |accumulate |tax-free |until |dispersed
2.5 |Why |is |the |employee |benefit |mechanism |an |effective |and |efficient |way |of |providing |
insurance |coverage? |- |ANSWER✔✔✔-It |is |convenient |for |employees |as |they |do |not |have |to |
search |for |individual |coverage |and |it |is |generally |less |expensive. |Providers |state |it |is |easier |to |
communicate |employee |benefits |through |an |employer.
3.1 |What |is |the |starting |point |in |the |design |of |any |employee |benefit |plan? |- |ANSWER✔✔✔-
Any |employee |benefit |plan |should |start |with |setting |overall |objectives |from |the |standpoints |of
|both |the |employer |and |the |employees.
3.2 |List |the |types |of |overall |questions |that |should |be |addressed |in |setting |benefit |objectives. |- |
ANSWER✔✔✔-• |What |benefits |should |be |provided?
o |Benefits |provide |under |both |government |programs |and |for |the |individual |employees |should |
be |considered
• |Who |should |be |covered |by |the |benefit |plan?
With Correct Answers
1.1 |Distinguish |between |the |broad |view |and |the |narrow |view |of |employee |benefits |- |
ANSWER✔✔✔-The |broad |view |defines |employee |benefits |as |anything |other |than |direct |
compensation, |including |both |government-mandated |benefits |and |private |plans. |(social |
security, |pension |plans |etc.). |The |narrow |view |holds |that |employee |benefits |are |any |benefit |
sponsored |unilaterally |or |jointly |by |employers |and |employees |that |is |not |subsidized |by |the |
government.
1.2 |List |the |categories |of |benefits |that |generally |are |considered |to |fall |under |a |broad |view |
employee |benefits |- |ANSWER✔✔✔-• |Legally |required |benefits |(Social |Security)
• |Payment |for |time |not |worked |(rest, |lunch, |vacation, |and |holidays)
• |Medical
• |Retirement |& |savings |plan |payments
• |Miscellaneous |benefits |(employee |discounts, |severance |pay, |education, |and |child |care)
1.3 |What |benefits |are |typically |excluded |when |the |term |"employee |benefits" |is |viewed |and |
defined |in |a |narrow |sense? |- |ANSWER✔✔✔-Those |that |are |legally |mandated |(Social |Security |
and |workers' |compensation)
2.1 |Explain |the |types |of |businesses- |or |human |resource-related |reasons |for |firms |establishing |
employee |benefit |plans |- |ANSWER✔✔✔-So |businesses |may |attract |& |retain |capable |
employees. |Good |benefit |plans |foster |corporate |efficiency, |productivity, |and |improve |
employee |morale.
2.2 |What |impact |have |labor |unions |historically |had |in |employee |benefits? |- |ANSWER✔✔✔-
Through |the |practice |of |collective |bargaining |labor |unions |have |had |an |impact |on |the |growth |
, of |employee |benefit |plans. |In |1948 |the |NLRB |ruled |in |the |Inland |Steel |case |that |the |duty |to |
bargain |in |good |faith |over |wages |also |included |insurance |and |fringes |such |as |pension |benefits.
|Following |that, |in |the |W.W. |Cross |& |Co. |case, |the |NLRB |ruled |that |wages |included |health |and |
accident |plan.
2.3 |Explain |the |significance |of |the |Taft-Hartley |Act |in |employee |benefit |planning. |- |
ANSWER✔✔✔-The |Labor-Management |Relations |Act, |also |called |the |Taft-Hartley |Act, |sets |
forth |the |framework |for |good-faith |collective |bargaining |over |wages, |hours, |conditions |and |
terms |of |employment |and |employee |benefits. |It |established |the |distinction |between |
retirement |benefits |and |welfare |benefits. |It |also |provides |framework |for |administration |of |
those |benefits. |It's |the |legal |basis |on |which |jointly |trusteed |benefit |plans |are |founded.
2.4 |Summarize |three |major |federal |tax |advantages |associated |with |employee |benefit |plans. |- |
ANSWER✔✔✔-• |Most |contributions |are |deductible |as |long |as |they |are |reasonable |business |
expenses
• |Within |limits, |the |contributions |are |not |considered |income |to |employees
• |In |certain |retirement/capital |plans, |benefits |accumulate |tax-free |until |dispersed
2.5 |Why |is |the |employee |benefit |mechanism |an |effective |and |efficient |way |of |providing |
insurance |coverage? |- |ANSWER✔✔✔-It |is |convenient |for |employees |as |they |do |not |have |to |
search |for |individual |coverage |and |it |is |generally |less |expensive. |Providers |state |it |is |easier |to |
communicate |employee |benefits |through |an |employer.
3.1 |What |is |the |starting |point |in |the |design |of |any |employee |benefit |plan? |- |ANSWER✔✔✔-
Any |employee |benefit |plan |should |start |with |setting |overall |objectives |from |the |standpoints |of
|both |the |employer |and |the |employees.
3.2 |List |the |types |of |overall |questions |that |should |be |addressed |in |setting |benefit |objectives. |- |
ANSWER✔✔✔-• |What |benefits |should |be |provided?
o |Benefits |provide |under |both |government |programs |and |for |the |individual |employees |should |
be |considered
• |Who |should |be |covered |by |the |benefit |plan?
