Total Rewards Exam with Complete
Solutions
Consumer price index (CPI) Correct Ans-Instrument that measures change over time for cost
of a group of goods and services.
Deductible Correct Ans-Initial amount of covered expenses an individual must pay before
receiving paid benefits under a health-care plan.
Draw Correct Ans-Amount advanced on future commissions.
Equal work Correct Ans-Work having equal skills, equal effort, equal responsibility, and
equal working conditions, all performed at the same location.
Factor comparison method Correct Ans-Job comparison method that ranks each job by each
selected compensble factor and then identifies dollar values to develop a pay rate.
Frequency distribution Correct Ans-Listing of grouped data, from lowest to highest.
Golden parachutes Correct Ans-Clauses written into executive contracts that provide special
payments to key executives who might lose their position or be otherwise disadvantage if another
company took control of the organization through a merger or acquistion; also known as
parachutes.
,Health Insurance Portability and Accountability Act (HIPAA) Correct Ans-Act that made
changes to improve health-care coverage protability and accessibility and provide medical record
privacy and security.
Incentive pay Correct Ans-Form of direct compensation where employers pay for
performance beyond normal expectations to motivate employees to perform at higher levels.
Involuntary deductions Correct Ans-Payroll deductions such as tax leview and court-ordered
child support that an employee must pay.
Long-term disability (LTD) coverage Correct Ans-Replaces a potion of an employee's lost
income after short-term disability coverage ends.
Mental Health Parity Act (MHPA) Correct Ans-Act that addresses parity between mental
health benefits and medical benefits.
Older Worker's Benefit Protection Act (OWBPA) Correct Ans-Act than amended Age
Discrimination in Employment Act to include all employee benefits, also provided terminated
employees with time to consider group termination or retirement programs and consult an
attorney.
Pay compression Correct Ans-Occurs when there is only a small difference in pay between
employees regardless of their skills, experience, or seniority; also known as salary compression.
Perquisites Correct Ans-Special privileges for executives that are usually noncash items.
, Premium pay Correct Ans-Extra pay for working holidays or vacation days.
Qualified domesic relations orders (QDROs) Correct Ans-Crerate or recognize the right of an
alternative payee to receive all or a protion of the benefits under a retirement plan.
Revenue rulings Correct Ans-Rulings published by the IRS as general guidelines to all
taxpayers or organizations.
Securities and Exchange Act Correct Ans-Act that regulated "insider trading".
Sick leave Correct Ans-Specified period of time during which employees who are ill or have
nonwork-related injuries receive their full salary.
Supplemental unemployment benefits (SUB) Correct Ans-Benefits paid to unemployed
workers beyond required goverment unemployement benefits.
Time-based step-rate pay Correct Ans-System in which pay is based on longevity in the job
and pay increases occur on a predetermined schedule.
Unweighted average Correct Ans-Raw average of data that gives equal weight to all factors
with no regard to individual factors such as the numer of incumbents or companies.
Solutions
Consumer price index (CPI) Correct Ans-Instrument that measures change over time for cost
of a group of goods and services.
Deductible Correct Ans-Initial amount of covered expenses an individual must pay before
receiving paid benefits under a health-care plan.
Draw Correct Ans-Amount advanced on future commissions.
Equal work Correct Ans-Work having equal skills, equal effort, equal responsibility, and
equal working conditions, all performed at the same location.
Factor comparison method Correct Ans-Job comparison method that ranks each job by each
selected compensble factor and then identifies dollar values to develop a pay rate.
Frequency distribution Correct Ans-Listing of grouped data, from lowest to highest.
Golden parachutes Correct Ans-Clauses written into executive contracts that provide special
payments to key executives who might lose their position or be otherwise disadvantage if another
company took control of the organization through a merger or acquistion; also known as
parachutes.
,Health Insurance Portability and Accountability Act (HIPAA) Correct Ans-Act that made
changes to improve health-care coverage protability and accessibility and provide medical record
privacy and security.
Incentive pay Correct Ans-Form of direct compensation where employers pay for
performance beyond normal expectations to motivate employees to perform at higher levels.
Involuntary deductions Correct Ans-Payroll deductions such as tax leview and court-ordered
child support that an employee must pay.
Long-term disability (LTD) coverage Correct Ans-Replaces a potion of an employee's lost
income after short-term disability coverage ends.
Mental Health Parity Act (MHPA) Correct Ans-Act that addresses parity between mental
health benefits and medical benefits.
Older Worker's Benefit Protection Act (OWBPA) Correct Ans-Act than amended Age
Discrimination in Employment Act to include all employee benefits, also provided terminated
employees with time to consider group termination or retirement programs and consult an
attorney.
Pay compression Correct Ans-Occurs when there is only a small difference in pay between
employees regardless of their skills, experience, or seniority; also known as salary compression.
Perquisites Correct Ans-Special privileges for executives that are usually noncash items.
, Premium pay Correct Ans-Extra pay for working holidays or vacation days.
Qualified domesic relations orders (QDROs) Correct Ans-Crerate or recognize the right of an
alternative payee to receive all or a protion of the benefits under a retirement plan.
Revenue rulings Correct Ans-Rulings published by the IRS as general guidelines to all
taxpayers or organizations.
Securities and Exchange Act Correct Ans-Act that regulated "insider trading".
Sick leave Correct Ans-Specified period of time during which employees who are ill or have
nonwork-related injuries receive their full salary.
Supplemental unemployment benefits (SUB) Correct Ans-Benefits paid to unemployed
workers beyond required goverment unemployement benefits.
Time-based step-rate pay Correct Ans-System in which pay is based on longevity in the job
and pay increases occur on a predetermined schedule.
Unweighted average Correct Ans-Raw average of data that gives equal weight to all factors
with no regard to individual factors such as the numer of incumbents or companies.
