PHR/SPHR/GPHR Practice Test 60 Questions with Verified Answers,100% CORRECT

PHR/SPHR/GPHR Practice Test 60 Questions with Verified Answers Which of the following statements about grievance procedures is true? A. Management pays for arbitration. B. HR professionals are involved in the first stage of the grievance procedure. C. About 50% of collective bargaining agreements detail the steps in a grievance procedure. D. The aggrieved employee contacts the union steward in the first step in the grievance process. - CORRECT ANSWER Grievance Procedure Answer: D A grievance is a charge that the union-management contract has been violated. A grievance may be filed by the union for the aggrieved employee(s), or by the employer (although rare). The most common grievance procedures involve the following steps: (1) Employee contacts the union steward, and together they discuss the problem with the supervisor involved; if not resolved (2) grievance taken to management and/or HR; if not resolved (3) top level management and union executives get involved; if not resolved (4) arbitrator will hold a hearing, review the evidence, and make a binding decision. The arbitrator is mutually chosen and the employer and the union share the cost. A new labor union official wants to use the NLRB for its intended purposes. The NLRB will serve the union by: A. Holding representative elections and investigating unfair labor practices. B. Holding representative elections and mediating collective bargaining disputes. C. Arbitrating employee grievances and investigating unfair labor practice cases. D. Arbitrating employee grievances and mediating collective bargaining disputes. - CORRECT ANSWER National Labor Relations Board Answer: A The agency responsible for administering and enforcing the Wagner Act is the National Labor Relations Board. Its purpose is to reduce labor-management conflicts. To accomplish this goal the NLRB is given two primary charges: (1) it holds secret-ballot elections to determine whether employees want to be represented by a union; and (2) to prevent and remedy unfair labor practices. The NLRB has regional offices and smaller field offices that process charges of unfair labor practices and petitions for employee elections. An ADR process used to address grievances that is considered "win-win" is: A. Litigation B. Arbitration C. Mediation D. Peer Review - CORRECT ANSWER Alternative Dispute Resolution (ADR) Answer: C Alternative dispute resolution (ADR) is an attempt to settle an employee grievance without going through the legal process (answer a - litigation). Mediation (answer c) is where a neutral 3rd party assists in resolving a grievance between parties. It results in a win-win solution (both parties negotiate to a mutually-satisfactory resolution of the grievance). Answer (b) arbitration occurs when a neutral 3rd party makes binding decision. It results in a decision where one party wins all and the other loses. Answer (d) peer review panels are groups of co-workers who review management's disciplinary decisions and make recommendations or, at times, even the final decision. It is also a win-lose resolution. Union organizing campaigns begin when any of the following occur, except: A. Employees request the union organizing campaign B. Employer is targeted by the union C. Union files a petition with the NLRB for recognition D. Employer requests the union campaign - CORRECT ANSWER Union Organizing Campaign Answer: C The union files a petition with the NLRB when it has a minimum of 30% signed authorization cards from employees authorizing the union as their collective bargaining agent. Unions begin an organizing campaign when employees seek union representation, the employer is targeted by the union, or the employer requests the union campaign because it knows it will be targeted by a union soon and it wants a specific union representing its workers. What is the purpose of workers' compensation legislation? A. To protect workers from unsafe working conditions B. To give workers paid time off when ill or injured C. To make employers liable for work related injuries D. To cover income and medical costs for work related injuries. - CORRECT ANSWER Workers' Compensation Answer: D State workers' compensation laws vary, but all are intended to provide for payment of full medical expenses, partial lost wages (usually 2/3 of salary), and survivor benefits, for work related injuries. Answer (a) is wrong - OSHA's purpose is to protect workers from unsafe working conditions; (b) it must be a work-related illness or injury to be covered under workers' compensation; (c) Workers' Compensation is no-fault insurance. The employer is not "liable". What is the BEST answer? The use of information technology impacts HR by: A. Facilitating more efficient communication between departments. B. Keeping better records. C. Expanding the scope and function of HR. D. Protecting the confidentiality of employee information. - CORRECT ANSWER HRIS Answer: C Although all of the answers are somewhat correct, answer (c) is the overall best reason for the impact on HR today. Human Resource Information Systems (HRIS) have allowed HR to become more strategic and less administrative. Employers paying men more than women performing the same job are in violation of the Equal Pay Act, if the pay difference is based on: A. Seniority systems B. Merit pay plans C. Incentive payments D. Similar conditions - CORRECT ANSWER Equal Pay Act Answer: D The Equal Pay Act prohibits discrimination in pay, employee benefits, and pensions based on gender for employees doing equal work. Equal work is defined as jobs that require substantially the same skill, effort, and responsibility under similar working conditions and in the same location. Employers do not violate the provisions of the EPA when they base wage differences on anything other than gender such as seniority, merit, or incentive pay plans. The Equal Pay Act is an amendment to the Civil Rights Act, Title VII and is administered by the Equal Employment Opportunity Commission (EEOC). Focusing greater attention on eliminating artificial barriers to the advancement of women to management positions in business is the responsibility of the: A. Equal Employment Opportunity Commission B. Office of Federal Contract Compliance Programs C. Older Workers Benefit Protection Commission D. Glass Ceiling Commission - CORRECT ANSWER The Glass Ceiling Commission Answer: D The Glass Ceiling Commission was established by the Civil Rights Act of 1991. Its mission is to promote workforce diversity and to focus greater attention on the importance of eliminating artificial barriers to the advancement of women and minorities to management and decision making positions in business. "Glass ceiling" refers to the fact that women seem to get just so high in an organization and then don't get promoted to executive positions. Similarly, "glass elevators" allow women to advance to senior positions in a limited number of functional areas only. "Glass walls" prevent women from moving into other functional areas within the organization, usually career moves necessary to be considered for a top executive job. What is the basic difference between job enrichment and job enlargement? A. Enriching a job involves adding more tasks to an existing job while enlarging a job involves adding more responsibilities. B. Enlarging a job indicates an increased rate of pay will accompany the new job responsibilities, usually at a step rate increment over time. C. Enlarging a job involves adding more tasks at the same level while enriching a job involves adding more responsibilities. D. The two terms essentially mean the same thing. - CORRECT ANSWER Job Enlargement and Enrichment Answer: C Job enlargement involves adding more tasks to the current position, while enriching a job involves adding more responsibilities. The way to remember this concept is enlargement is the process if increasing what is already part of the role. Enriching involves developmental opportunities and responsibilities. Answer (a) is incorrect, as the responses are backward, (b) is incorrect as the concept of enlarging a job and increased pay is not appropriate, and (d) is incorrect, as the two terms are not the same. Non-qualified retirement plans are: A. Illegal plans, and therefore, employers may not offer them. B. Plans offered to all employees on a tax-deferred basis, so do receive favorable tax treatment. C. Plans offered to a select group of employees, so don't receive favorable tax treatment. D. Plans that meet IRS Code for retirement plans. - CORRECT ANSWER Non-Qualified Retirement Plans Answer: C Retirement plans can be classified in terms of whether they are qualified or non-qualified. A qualified plan covers a broad class of employees, meets Internal Revenue Code requirements, and therefore, is qualified to receive favorable tax treatment. Employee contributions to the plan are tax deferred until retirement, and employer contributions are tax deductible for the current year. Plans that do not qualify for IRS favorable tax treatment are often used to provide additional benefits for executives. The Balance Sheet in an organization represents: A. The financial position of the organization. B. The financial position of the organization and level of revenue. C. An explanation of revenues, expenses and profits over time. D. Gross profit. - CORRECT ANSWER Balance Sheet Answer: A The balance sheet represents the financial position of an organization. Answer (b) is not correct, and (c) is the definition of an Income Statement (revenues, expenses and profits over time). Answer (d) gross profit is the difference between the cost of goods sold and sales. Matrix reporting relationships include all but the following: A. Single chain of command. B. Reporting to more than one supervisor. C. Involvement in two or more areas of an organization. D. Increased communication. - CORRECT ANSWER Matrix Reporting Answer: A Single chain of command is when an employee reports to one supervisor. In a matrix situation, an employee reports to more than one person -- for example, the HR Manager at a manufacturing plant may report to the General Manager at that site, but may also report to the Vice President of Human Resources at the Corporate Headquarters. The Act that allows victims of sexual, disability, or religious discrimination to request a jury trial and punitive damages is the: A. Civil Rights Act, Title VII B. Civil Rights Act of 1991 C. Americans With Disabilities Act D. Federal Contract Compliance Act - CORRECT ANSWER Civil Rights Act, 1991 Answer: B The Civil Rights Act of 1991 allows victims of sexual, disability, or religious discrimination to request jury trials and both compensatory and punitive damages. The maximum award allowed is based on the size of the organization. The jury award may award up to $300,000 against employers with over 500 employees. If making a reasonable accommodation for an individual with a disability would be unreasonably expensive, the employer may: A. Claim undue hardship B. Be required to make the accommodation anyway C. Be required to find alternate work for the person D. Reduce the person's salary to compensate for the added expense - CORRECT ANSWER Reasonable Accommodation Answer: A When an individual requests an accommodation in order to perform his/her job duties, the Americans with Disabilities Act requires employers to provide reasonable accommodations if the person's disability affects a major life function. The reasonableness of the accommodation is based on the size of the employer and the cost of the accommodation. Large employers would be expected to provide more extensive, expensive, accommodations than would a small employer who may claim an undue hardship. A __________ is used to identify possible replacement employees for key positions that must be filled immediately should the position become open. A. Markov Matrix B. Replacement chart C. Succession chart D. Staffing chart - CORRECT ANSWER Forecasting Labor Supply Answer: B Replacement charts are a listing of current jobholders and potential replacements should a job become open. It is most often used to identify and cross train possible replacements for jobs that must be filled immediately. Answer (c) succession planning is the more long range planning and development of potential executives that ensures a suitable supply of successors for future senior level jobs. Answer (a) a Markov Matrix models the internal flow of human resources over time. Materials are protected under U.S. copyright law: A. Immediately upon registering the work with the U.S. Copyright office B. Once the work is first presented to the public C. The moment the work is first printed or saved electronically D. Upon receipt of the copyright authorization from the Copyright office - CORRECT ANSWER Copyright Act Answer: C Under the Copyright Act of 1976, materials are automatically protected by U.S. copyright law from the moment they are first printed or saved electronically. A copyright may be filed with the U.S. Copyright office, but is only necessary in order to file a suit for copyright infringement. What happens, according to Herzberg's Theory, if all the hygiene factors are met? A. The employee is motivated to work harder B. The worker may not be motivated to work harder C. Productivity increases D. Interpersonal relations improve - CORRECT ANSWER Herzberg's Motivation-Hygiene Theory Answer: B In Herzberg's theory, there are two dimensions: 1) hygiene factors (external) and 2) motivation factors (internal). Hygiene factors include working conditions, salary, job security, supervisor relations, etc. Motivation factors consist of the opportunity for achievement, recognition, and growth. The presence of hygiene factors does not create satisfaction or motivation, but the absence of hygiene factors cause dissatisfaction even if the motivation factors are present. An employer with an entitlement philosophy believes that employee's pay should be based on: A. Performance differences B. Increased knowledge C. Skills mastered D. Seniority - CORRECT ANSWER Employer Compensation Philosophies Answer: D An employer with an entitlement compensation philosophy believes that employees should be rewarded for their length of time on the job. Answer (a) refers to a contribution philosophy (pay for performance); (b) refers to a competency based approach to rewards; and (c) refers to an approach that rewards each new skill mastered. Executive incentive pay is usually all of the following, except: A. Based on the overall success of the organization B. A large portion of total compensation C. Paid annually to encourage strong sales and immediate profits D. At risk, not guaranteed - CORRECT ANSWER Executive Compensation Answer: C Executive incentive pay is usually at risk based on the overall success of the organization, and it's often a large portion of the executive's total compensation. Also, much of it is probably long term deferred compensation, or a rolling incentive plan, to encourage long term organizational success, not short term thinking. Which of the following terminated employees are eligible for unemployment compensation? A. Persons who are involuntarily terminated B. Persons who are employed by an immediate family member C. Persons who are currently receiving a pension D. Persons who return to school full time - CORRECT ANSWER Unemployment Compensation Answer: A Unemployment compensation provides partial income during periods of involuntary unemployment. It also helps unemployed workers locate new employment. To be eligible, the terminated worker must (1) have been involuntarily terminated; (2) must not have been discharged for misconduct or poor performance; and (3) must be able and willing to work. Unemployment compensation insurance is mandated by federal law, administered by the states, and funded by employers. Answer (b) is incorrect -- persons who are self-employed or work for an immediate family member are not eligible. Also answer (c) persons receiving pensions are not eligible; and (d) full time students are not eligible because they are not "able and willing" to work full time jobs. Inadequate human resource planning could result in all of the following, except: A. Key employees leaving for other job opportunities. B. Positions may not be filled. C. There may be layoffs due to over staffing. D. The supply of labor is increased. - CORRECT ANSWER Human Resource Planning Answer: D Human resource planning (HRP) is the strategic process of anticipating the need for workers and the movement of employees into, within, and out of the organization. This includes training and developing workers for career advancement within the organization, and anticipating staffing needs to prevent layoffs during slow times. Inadequate HRP may result in: (a) employees who feel they have no advancement opportunities within the firm leave for other career opportunities; (b) without anticipating the need for labor, positions may go unfilled; and (c) when production peaks and slow periods are not planned for, there may be an overabundance of workers during peak times who must be laid off during slow times. This results in higher unemployment and severance costs. What is the next logical step to take after a benchmarking analysis has been completed? A. Contact the survey participants for clarification B. Develop a "gap analysis" based on the benchmarking data C. Create a due diligence review of the process D. Implement needed change - CORRECT ANSWER Benchmarking Answer: B By developing a gap n b., the organization can compare itself to other organizations, and determine where there are significant differences. This allows the organization to determine what, if anything, it wants to address relative to the benchmark survey. The Board of Directors of a very large company plans to require its president and CEO to retire at age 65. Which of the following statements is MOST correct? A. Under the ADEA, companies may no longer have mandatory retirement policies. B. There are exceptions to the ADEA that permit mandatory retirement if certain specific conditions are met. C. Companies may only have mandatory retirement policies for safety-sensitive positions where age may be a factor in job performance. D. Companies may have mandatory retirement policies only if applied to individuals over 70. - CORRECT ANSWER ADEA - Mandatory Retirement Answer: B There are certain exceptions to the Age Discrimination in Employment Act (ADEA) that allow for mandatory retirement if the following conditions exist: (1) the employee is at least 65 years of age; (2) has been employed for the two-year period immediately before retirement in a bona fide executive or high policy-making position; and (3) is entitled to an immediate non-forfeitable annual retirement benefit from a pension, profit sharing, savings, or deferred compensation plan of at least $44,000/year. The rationale behind this exception is that organizations should be allowed to promote up and coming executives to top positions. (c) is also a true statement. Another exception to the Act allows mandatory retirement policies for safety-sensitive positions (like airline pilots, police, and firefighters) where age can be a demonstrated factor in job performance. Training objectives should be derived from: A. A needs analysis B. Top management initiatives C. Individual career development plans D. Requests from management - CORRECT ANSWER Training Objectives Answer: A Training objectives should start with a needs analysis. Regardless of how a training initiative is requested or identified, it is critical to understand the specific needs of the organization/department/individual prior to initiating training. If a program is initiated purely by top management, then the training will be delivered based on "top management" requirements; however, it may not be clearly understood or take into account the needs of the learner. Remember, the question asks "how SHOULD" they be derived? The best answer is through a needs analysis, however, the other three responses do occur, but may not yield the best results. In an "experience-rated" health insurance plan: A. Health insurance rates are based on the age of each member. B. The anticipated future expenses are the basis for rate adjustments C. The surplus premium not paid out in claims from the last year is deducted from the next year's premium. D. The actual previous claims experience is the basis for determining the next year's premium rates. - CORRECT ANSWER Experience Rating Answer: D In an experience-rated health insurance plan, the actual previous financial experience of the employer's plan is the basis for determining the future plan year's premium rate. If the employer's actual claims experience has been favorable in the past, the future premium rates will be less than the conventional premium rates of other similar employers. In contrast, if the loss experience has been unfavorable, future premium rates will increase. The bonus given to team members under an Improshare plan differs from that given under the Scanlon or Rucker plans in that: A. It is given for productivity gains resulting from a reduction in production time. B. It is based on individual contributions to the goal. C. It is based on the number of dollars saved. D. The group members receive the total amount saved. - CORRECT ANSWER Gain Sharing Plans Answer: A In an Improshare Plan, the bonus is not based on dollar savings, as in the Scanlon and Rucker Plans, but on productivity gains that result from reducing the time it takes to produce a finished product; it is similar to piece rate, but rewards all worker in the group. Bonuses are determined monthly by calculating the difference between standard hours (Improshare hours) and actual hours. The employer and the group share equally in the profit from the improved production time. Which of the following is an acceptable reason for discharging an employee in an employment-at-will state? A. Mimi complained about her workload on a daily basis to her supervisor and anyone else who would listen to her. B. Anna talked to union organizers about trying to start a union at her firm C. Sally violated company policy when she spent more than two weeks on jury duty. D. Sue fell and broke her ankle in an unauthorized section of the building and filed a workers compensation claim. - CORRECT ANSWER Public Policy Exceptions to EAW Answer: A Even in employment-at-will states, employees may not be terminated for "reasons that violate basic social rights, duties, or responsibilities." These "public policy' exceptions include being fired for refusing to violate a law or being required to perform a criminal activity; or for exercising a legal right or performing a legal duty. (b), (c) and (d) are all legal rights or duties. A peer-review panel typically consists of a group of: A. Supervisors and non-supervisory employees. B. Managers above the level of the employee's supervisor whose decision is being appealed. C. Co-workers of the employee making the appeal. D. Managers, peers of the employee, and an unbiased third-party who does not work for the company. - CORRECT ANSWER Peer Review Panels Answer: A A peer review panel reviews employment decisions, usually when an employee appeals a disciplinary action, is demoted, or discharged. It typically consists of an equal number of employee representatives and management appointees, who function as an appeals board. Its members weigh evidence, consider arguments, and after deliberation, vote independently to render a final decision. Depending on company policy, the decision may be binding or just a recommendation to top management. When determining the bargaining unit for collective bargaining purposes, temporary workers: A. Are employees of a temporary agency and not considered part of the bargaining unit. B. May be considered within the bargaining unit if both the temporary agency and the contracting employer consent. C. Are only part-time employees and not considered part of the bargaining unit. D. Are considered joint employees of the employer and the temporary agency and are eligible to vote in the bargaining unit election. - CORRECT ANSWER Temporary Employees Answer: B In a recent decision, H.S. Care L.L.C. (2004), the NLRB has returned to the position that temporary agency employees who are jointly employed by the temporary agency and the contracting employer cannot be made part of a single bargaining unit without the consent of both employers. This decision overturns M.B. Sturgis v. NLRB (2002), which ruled that regular workers and temporary workers could be included in the same bargaining unit. The first step in preventing and eliminating workplace hazards is: A. Developing a policy to address them. B. Creating a safe workplace initially. C. Use of engineering controls. D. Use of mechanical improvements. - CORRECT ANSWER Workplace Hazards Answer: C The first step in preventing or eliminating workplace hazards should be the use of engineering controls. Engineering controls can include lowering workbenches, installing safety switches, building machine guards, or adding mechanical lifting devices. Workplace layouts can often be redesigned to eliminate hazards as well. The other answers are not effective "first steps" - developing a policy is not proactive; setting up a safe workplace is good, but it is nearly impossible to eliminate all hazards just from an initial set up; and, use of mechanical improvements is one element of engineering controls. Information technology creates a transformational impact on HR by: A. Expanding the scope and function of the HR Department B. Allowing organizations to store and retrieve a large amount of employee data on computers C. Controlling organizational knowledge D. Facilitating fast and easy communication between business units - CORRECT ANSWER HRM Technology Answer: A An effective HRIS system provides a data and communication platform that allows HR to leverage the company's human capital to achieve competitive advantages. Rather than just changing how HR activities are undertaken, a good IT system allows an expansion of the HR role. For example, instead of relying on traditional approaches to learning, HR can create web-based e-learning opportunities to train all employees more quickly and efficiently. The customer who purchases an automobile would be considered a(n) _________ of the automobile manufacturer. A. investor B. owner C. secondary stakeholder D. primary stakeholder - CORRECT ANSWER Stakeholders Answer: D "Stakeholders" have ownership, interests, or rights in an organization. Customers, suppliers, employees, and society are all stakeholders. The organization must address the needs of the primary stakeholders, such as customers, to ensure its own survival. HR practices cannot be designed to just meet the needs of employees. In order to develop a "stakeholder approach" to managing human resources, the concerns of each stakeholder group must also be understood. The age distribution of the future labor force is expected to mean there will be: A. More workers to support Social Security benefits. B. More career opportunities for middle-aged workers. C. Less need to retrain older workers. D. Greater competition for promotional opportunities. - CORRECT ANSWER Demographics Answer: D The baby boomers (approximately age 40 to 55) have had to struggle with excessive competition for career advancement opportunities throughout their careers due to the large number of experienced workers in their age group. The next age imbalance in the workforce is expected to be the "echo boom" effect, the children of the boomers, who will also experience greater competition for advancement from others in approximately the same age range. The strategic challenge for HR planners is to develop career paths and alternatives for these employees. The foremost enforcer against illegal recruitment and employment of foreign-born workers within the U.S. is the: A. U.S. Government B. Foreign governments C. Employer D. State employment administrators - CORRECT ANSWER Illegal Workers Answer: C The Immigration Reform and Control Act (IRCA), 1986, places the major responsibility on employers for stopping the flow of illegal immigration into the U.S. Under the law's "employer sanctions" provision, all employers are required to ensure every new hire's eligibility for lawful employment. Employers have the duty to: 1) refrain from recruiting, hiring, or continuing to employ "unauthorized aliens"; 2) verify the identity and work authorization of every new employee; and 3) not discriminate on the basis of citizenship or national origin. Employers are always liable for quid pro quo sexual harassment because: A. It takes place during working hours B. Both parties are employees of the organization C. A supervisor's acts are viewed as acts of the employer D. The supervisor demanded sexual favors for a job benefit - CORRECT ANSWER Quid Pro Quo Answer: C Although (b) and (d) are correct statements, (c) is the better answer because, according to the EEOC, employers are always liable for quid pro quo sexual harassment. A supervisor's acts involving tangible job benefits or detriments are viewed as acts of the employer. Supervisors act as "agents" of the employer A key benefit of cross-training workers is that it: A. allows employees to exert more effort in their jobs. B. assists workers in identifying trouble spots in several jobs. C. requires less supervision of individual performance. D. saves money on labor costs. - CORRECT ANSWER Cross Training Answer: B Today's emphasis on teamwork, employee involvement, and continuous improvement requires that employees have a broader understanding of work processes beyond just their own tasks. Although (d) cross-training employees within a department may save on labor costs, (b) is the better answer because it facilitates employee involvement in that they may identify trouble spots that cut across several jobs and allows them to suggest necessary improvements. An organization in its mature stage realized that over the next 2-3 years well over 200 workers would retire. In order to address the skill requirements to replace these workers, HR should do all the following immediately except: A. Determine a strategic plan B. Identify the knowledge and skills at risk of being lost when employees retire C. Assess the risk involved with losing needed KSA's D. Address gaps involved with skill loss - CORRECT ANSWER Training Objectives Answer: A While determining a strategic plan is important, it isn't the first thing that needs to be assessed. Before creating a plan of any kind, it is critical to understand what the objectives are - clearly, losing employees to retirement creates significant needs for transfer of knowledge, and understanding what skill sets could be lost. Once the objectives have been identified, a training plan should be developed. The first step in interpreting the results of a pay survey is to: A. verify the accuracy of the data B. update the salary data C. perform a regression analysis D. review the findings with top management - CORRECT ANSWER Pay Surveys Answer: A When receiving salary survey data, the first step is to check the accuracy of the job matches, and then check for anomalies (data from one survey participant that is substantially out of line with other data), age of the data, and the nature of the participating organizations (industry size, type of business, number of employees, etc.). Salary data should be from comparable organizations to your own. Which of the following statements would probably be viewed negatively by the NLRB? A. Management says, "If the union wins, strikes may occur." B. The union promises, "Grievance procedures will ensure fair treatment." C. Management says, "Layoffs will happen if the union wins." D. The union says, "Vote for the union and we promise you higher wages." - CORRECT ANSWER Pre-Election Campaign Answer: C After the bargaining unit has been determined, both union and management begin campaigning in an attempt to influence employees' votes. Unions claim to provide a strong voice for employees, promise improvements in wages and working conditions, and grievance procedures to ensure fairness. Management emphasizes the employee costs - dues, strikes, and possible loss of jobs. However, the NLRB forbids unfair labor practices such as the use of threats or coercion by either management or the union to influence the election. Answer (b) is a possible ULP because management is saying that "layoffs will occur if the union wins." During collective bargaining negotiations, the employer claims it is financially unable to meet the union wage increase demands. The employer may: A. Be able to void its contract with the union. B. Refuse to continue bargaining until the union lowers its' wage increase demands. C. Be required to substantiate its claim by showing the union its financial records. D. Request a contract extension. - CORRECT ANSWER Collective Bargaining Answer: C When an employer claims it is financially unable to meet the union's wage demands, it is obligated, under the National Labor Relations Act's duty to bargain in good faith, to prove that it is indeed unable to give the wage increase. If requested by the union, it must "open its books" to the union. Instead of telling the union it is financially unable to meet the wage demand, the employer should say it is unwilling to meet the demand. An organizational structure that has fully autonomous units operating in several countries is a(n): A. Global enterprise; B. Multi-national corporation; C. International company; D. Transnational organization. - CORRECT ANSWER Global Organizational Structures Answer: B A Multi-National Corporation has independent business units operating in multiple countries. Its international strategy (also called multi-domestic or local responsiveness strategy) is to seek both global efficiency and local responsiveness. Strategic and operating decisions are decentralized to the business unit in each country. It is led by local entrepreneurs with much autonomy, and allows each unit to adapt products to the local market; it's viewed by customers as an indigenous company. In Germany, under _____________, union or worker representatives are given positions on a company's board of directors. A. Co-determination; B. Veto control; C. Co-option; D. Joint control. - CORRECT ANSWER Co-determination Answer: A Co-determination is a practice whereby union or worker representatives are given positions on a company's Board of Directors, as well as having significant voice in matters related to employment through work councils. An organization that starts a foreign operation from scratch is said to be a __________venture. A. Born Global B. Turnkey C. License D. Greenfield - CORRECT ANSWER Foreign Subsidiaries Answer: D A Greenfield Venture is a foreign operation started from scratch. An organization started with global operations from the beginning is said to be Born Global. A Turnkey Operation is a multi-national organization that makes a project fully operational and trains local managers and workers before the foreign owner takes control. Cooperative alliances are all of the following, EXCEPT: A. More secure than an international joint venture because firms must invest up front when the new company is created; B. More flexible and easier to create; C. Less visible to competitors; D. Easier to dissolve. - CORRECT ANSWER Cooperative Alliance Answer: A An international cooperative alliance is an agreement between two or more organizations from different countries that does not set up a legally separate company. It involves some inter-firm integration that goes beyond just a buyer-seller relationship, but it is not a merger or acquisition. A(n) ______________________ strategy gives top priority to seeking location advantages and gaining operational efficiencies through international locations. A. Regional B. Multi-domestic C. Transnational D. International - CORRECT ANSWER Participation Strategies Answer: C An organization following a transnational strategy is both globally integrated and locally responsive. For example, product development and manufacturing may be centralized, but it is still responsive to localized market niches. An employee who is a citizen of the foreign country in which a U. S. company is doing business is a(n): A. Expatriate B. Host-country national C. Third-country national D. Head-quarter national - CORRECT ANSWER Global Assignees Answer: B An Expatriate is a citizen of the country of the organization's headquarters working in a division in another country; example: American working in China; A Host-country national is a citizen of the country in which the division is located; example: Mexican worker working in Mexico; and a Third-country national is a citizen of another country that is not the headquarter company, nor the host country; example: Chinese citizen hired by an American company to work in Mexico. Which statement regarding expatriate taxation is false? A. The problem of double-taxation in the U.S. is alleviated by an income exclusion of about $50,000; B. The current tax rate for U.S. workers is about 35%; C. Global firms are subject to different tax rates in each country; D. Tax rates change within countries from time to time. - CORRECT ANSWER Tax Treaties Answer: A Under Double-Tax Treaties, expatriates are taxed at a reduced rate or are exempt from income taxes on certain items of income they receive from sources within the country they are working in. These reduced rates and exemptions vary among countries and specific items of income. Selection in collectivist cultures is most often based on all of the following, EXCEPT: A. Job qualifications; B. Being in the in-group; C. School and university ties; D. Potential trustworthiness, reliability, and loyalty. - CORRECT ANSWER Selection around the World Answer: A Selection in Collectivist Cultures is most often based on the in-group; preference for family - school and university ties may substitute for family membership; value potential trustworthiness, reliability, and loyalty over performance-related background. Each of the following statements about developing countries is true, EXCEPT: A. Wage levels are low, so the source of labor is cheaper; B. They have an abundant supply of productive workers; C. There is less economic risk than in developed countries; D. Emerging political structures may be unstable. - CORRECT ANSWER Stages of Country Development Answer: C Developed countries have mature economies, high gross domestic product (GDP), and international trade and investments. The developing countries, such as Hong Kong, Singapore, South Korea, and Taiwan, have economies that have grown extensively since the 1980's but have sometimes struggled recently, especially during the late 1990's. Expatriates receiving extra pay for poor living conditions or risk in a foreign assignment are given: A. Home-leave pay; B. Hardship allowances; C. Relocation pay; D. Foreign pay allowances. - CORRECT ANSWER Expatriate Allowances Answer: B Expatriate allowances are given in addition to base pay to allow for differences in expenses such as cost of living, taxes, settling in, and housing. A hardship allowance is extra money paid for a particularly difficult posting because of issues such as high risk or poor living conditions. An organization with a _______________ would typically benefit by using more local managers, thereby reducing the cost of training and sending expatriate managers. A. Geocentric orientation; B. Polycentric or Regiocentric HRM orientation; C. Ethnocentric HRM orientation; D. Global HRM orientation. - CORRECT ANSWER Expatriate Training Answer: B In an organization with a polycentric or regiocentric orientation, each subsidiary is treated as its own entity, and each country-level operation is treated separately for HRM purposes. Hiring and training at the local level would be most cost-effective. The major problem in compensating expatriates arises: A. when employees are first sent to foreign countries and they are still aware of market rates. B. from the need to preserve equity. C. when the percentage of expatriates begins to pass 33%. D. because foreign rules governing compensation are so complex. - CORRECT ANSWER Compensating Expatriates Answer: B The intent of expatriate compensation plans is to help keep the expatriates financially whole and to minimize the disruptions of the move (preserve equity). This involves ensuring a standard of living about equal to their peers in the home or base country. This is a broad standard that often results in very costly compensation packages. When compensation policies are developed for multinational firms, all of the following are important considerations, EXCEPT: A. Consistency with overall strategy B. Structure C. Business needs of the MNE D. Emphasis on PCNs rather than HCNs - CORRECT ANSWER Compensation Objectives Answer: D When developing international compensation policies, an organization seeks to achieve several objectives: (1) the policy should be consistent with the overall strategy, structure and business needs of the multinational; (2) the policy most work to attract and retain staff in the areas where the MNE has the greatest needs and opportunities; (3) the policy should facilitate the transfer of international employees in the most cost-effective manner for the firm; and (4) the policy must be equitable and easy to administer. Setting goals for work groups works best in: A. Any culture; B. Collectivist cultures; C. Individualist cultures; D. High power distance cultures. - CORRECT ANSWER Goal Setting Answer: B Workers in collectivist cultures respond better to higher levels of participation in goal setting than do people from more individualistic cultures such as the United States. In societies with cultural values supporting the necessity of belonging to a group, participation may have a greater chance of enhancing the worker's ownership and commitment to goals. Training expatriates to prepare for global assignments includes all of the following EXCEPT: A. Pre-departure training for both the employee and family B. Business etiquette of the other culture C. On-the-job training in the new country D. Cross-cultural technology - CORRECT ANSWER Training Global Employees Answer: C Employees are selected for global assignment because of their expertise. They would, however, need pre-departure training to prepare for the cultural and, perhaps, technological changes they will face when working in another country. An expatriate manager finds that he is a most effective leader when he shows signs of status, such as having a chauffeur drive his car. He is most likely in a country with a ______________ culture. A. High uncertainty avoidance; B. Low power distance; C. Person centered; D. High power distance. - CORRECT ANSWER Leadership Style Answer: D In high power distance countries, there are special privileges for those of higher status, and superiors consider subordinates as a different kind of person. Examples of high power distance countries are the Philippines, Venezuela, Singapore, Mexico, India, Russia, China, Indonesia, West Africa, and France. A redundancy payment is made to an employee who: A. Takes on an undesirable international assignment; B. Returns from a successful international assignment; C. Has lost their job because they are no longer needed D. Accepted another position within the same company - CORRECT ANSWER Severance and Redundancy Answer: C A redundancy payment (the U.S. term is "severance") is money that a company pays to workers who have lost their jobs because they are no longer needed. In many countries, the redundancy payment amount is proscribed by law. In the U.S. it is not required, but some companies have Severance Policies. The _____________ approach to determine expatriate pay uses worldwide salary scales, job evaluations, and performance appraisal methods. A. Global pay; B. Balanced Sheet; C. Local; D. Head-quarters based. - CORRECT ANSWER Determining Pay Answer: A To address the problem of compensation for multiple and continuous global assignments, organizations develop global pay systems. These systems have worldwide job-evaluation and performance-appraisal methods designed to assess the worth of jobs to the organization and equitably reward subordinates. The "Acquired Rights Directive" is an EU regulation ensuring: A. European Union members the right to the best workers; B. That terms and conditions of employment are maintained as workers are transferred between countries. C. That trade agreements among EU member countries are fair and equitable; D. That employees in EU countries may leave their employment at any time. - CORRECT ANSWER Acquired Rights Directive Answer: B The European Union regulation ensuring that terms and conditions of employment are maintained as workers are transferred between European Union countries. HR's involvement in assisting expatriates on assignment is: A. Much more intense once the expatriate relocates; B. Limited to business issues; C. More involved in the personal lives of expatriates; D. Very similar to HR relations in the U.S. - CORRECT ANSWER Practical Assistance Answer: C HR may be much more involved in the personal lives of expatriates; for example: assisting in selection of housing options (availability and appropriateness of location); the education of children (local schools, international schools, or boarding schools; driver's license applications and other registrations; and even where to shop and how set up bank accounts.