PHR Domain 4: Total Rewards Welcome to your PHR Domain 4: Total Rewards 1. PHR: Total Rewards Which of the following best describes a defined benefit plan? A. A retirement plan where the employee's benefits are computed using a formula considering factors such as salary history and duration of employment. B. A retirement savings plan where the contribution amounts are defined, but the benefits at retirement depend on investment performance. C. A healthcare plan that defines the benefits covered, leaving the employee to cover any costs over the defined benefit limits. D. A profit-sharing plan that defines the method of allocating company profits to employees without guaranteeing a specific amount. None 2. PHR: Total Rewards What is the primary purpose of a nonqualified deferred compensation plan for high-earning employees? A. To provide a tax-advantaged savings option that is not available through traditional retirement plans due to income restrictions. B. To allow these employees to convert their annual bonuses into stock options at a favorable tax rate. C. To ensure that employees at all income levels have the same retirement savings opportunities. D. To distribute company profits to employees in a way that maximizes shareholder value. None 3. PHR: Total Rewards Which of the following best defines a cafeteria plan under Section 125 of the IRS Code? A. A plan that allows employees to choose from a variety of pre-tax and after-tax benefits. B. A retirement savings plan offering a selection of investment options to employees. C. A flexible spending account that employees can use to pay for eligible healthcare expenses. D. An insurance plan that offers employees a choice between PPO and HMO. None 4. PHR: Total Rewards In the context of executive compensation, what is a "golden parachute"? A. A guaranteed severance package offered to employees in the event of a layoff. B. A retirement plan that significantly exceeds the benefits available to average employees. C. A substantial compensation package provided to executives if they are terminated following a merger or acquisition. D. A performance bonus awarded to executives for achieving specific financial targets during a fiscal year. None 5. PHR: Total Rewards The payback period of a tuition reimbursement program is best described as: A. The time it takes for an employee to repay the costs of tuition to the employer. B. The duration after course completion before an employee is eligible for promotion. C. The period during which an employee must remain with the company after completing their education to avoid repaying the tuition costs. D. The time it takes for the employer to realize gains in productivity from the employee's enhanced skills. None 6. PHR: Total Rewards Which principle of compensation states that pay should be equivalent to the value of the work performed? A. Equity theory B. Pay-for-performance C. Labor market competition D. Job evaluation None 7. PHR: Total Rewards In terms of employee benefits, what is COBRA? A. A type of health insurance plan offered exclusively to senior executives. B. A federal law that allows employees and their families to continue their health insurance coverage after a job loss or other qualifying event. C. A health savings account that employees can contribute to on a pre-tax basis. D. A wellness program aimed at reducing healthcare costs by encouraging healthy living habits among employees. None 8. PHR: Total Rewards What is the primary goal of a broad-banding salary structure? A. To decrease the number of pay grades and increase the breadth of each, thereby providing more flexibility in employee promotions and lateral moves. B. To increase the number of distinct pay grades, allowing for more granular differentiation of job roles and responsibilities. C. To reduce overall payroll costs by consolidating similar job functions into fewer categories. D. To align the company's salary structure more closely with industry standards and competitive benchmarks. None 9. PHR: Total Rewards Which of the following best exemplifies the concept of "total rewards"? A. Implementing a competitive base salary program. B. Offering employees a comprehensive package that includes salary, benefits, work-life balance, recognition, and development opportunities. C. Focusing solely on performance bonuses and incentive pay. D. Prioritizing long-term equity awards over immediate cash compensation. None 10. PHR: Total Rewards A "living wage" policy is designed to ensure that: A. Employees earn enough to meet their basic needs, such as housing, food, and healthcare, based on the cost of living in their area. B. All employees within the organization earn the same wage, regardless of their job function or seniority. C. Employees are compensated based on their living situation, with adjustments made for those with dependents. D. The minimum wage set by the government is adjusted annually to reflect inflation and cost of living increases. None 11. PHR: Total Rewards What is the primary function of a salary survey in compensation management? A. To determine the highest paying jobs within the industry to set executive salaries. B. To assess the average cost of living increases and adjust salaries accordingly. C. To collect data on compensation rates for similar positions in the market to inform an organization's pay structure. D. To survey employees on their satisfaction with their current salary and benefits package. None 12. PHR: Total Rewards In the context of total rewards, which of the following best defines "benchmarking"? A. The process of setting minimum and maximum pay rates for specific job categories. B. Comparing an organization's practices and compensation levels against those of leading companies in the industry. C. Evaluating the effectiveness of an organization's benefits offerings through employee surveys. D. Establishing performance standards for incentive pay and bonuses. None 13. PHR: Total Rewards The equity theory in compensation management primarily focuses on: A. Legal compliance with minimum wage laws and regulations. B. The fairness and equality of pay structures within an organization. C. The return on investment for employee training and development programs. D. Aligning executive compensation with company performance. None 14. PHR: Total Rewards A "tiered" benefits plan is designed to: A. Offer all employees the same level of benefits regardless of their position or tenure. B. Provide different levels of benefits based on employee grade or tenure, allowing for customization and flexibility. C. Restrict the most expensive healthcare options to higher-level executives only. D. Implement a standard cost-sharing formula for all types of benefits across the organization. None 15. PHR: Total Rewards The primary goal of "variable pay" is to: A. Reduce the fixed costs associated with employee compensation. B. Align employee compensation with organizational performance and individual achievement. C. Standardize compensation across similar job titles to prevent pay inequity. D. Offset the higher costs of providing comprehensive health benefits. None 16. PHR: Total Rewards The concept of "total compensation statement" is best described as: A. A detailed breakdown of an employee's base salary, bonuses, and stock options. B. A document that outlines all the cash and non-cash benefits provided to an employee, including salary, benefits, retirement contributions, and other perks. C. A yearly statement required by the IRS to report an employee's earnings and taxes withheld. D. A comparative analysis of compensation packages offered by different companies within the same industry. None 17. PHR: Total Rewards What is the purpose of a "market pricing" approach in compensation management? A. To ensure that all employees are paid at least the minimum wage. B. To base pay structures on the prevailing market rates for similar positions in the industry. C. To adjust salaries based on the cost of living in different geographical locations. D. To set prices for products and services based on the labor costs involved in production. None 18. PHR: Total Rewards "Glassdoor" and similar employee review sites impact compensation strategy by: A. Providing a platform for employees to anonymously share salary information and company reviews. B. Offering companies a way to advertise their jobs directly to potential employees. C. Allowing employers to benchmark their compensation against competitors without conducting formal surveys. D. Reducing the need for traditional job descriptions and salary negotiations. None 19. PHR: Total Rewards The use of "pay scales" in compensation management helps to: A. Eliminate the need for performance appraisals and merit-based increases. B. Ensure that employees performing similar work receive similar pay, based on their experience and performance. C. Provide a minimum guaranteed income for all employees, regardless of their position. D. Automatically adjust employee salaries for inflation on an annual basis. None 20. PHR: Total Rewards The principle of "internal equity" in compensation is concerned with: A. Ensuring that the company's pay rates are competitive with the external job market. B. Guaranteeing that employees in different departments receive equitable pay for equivalent positions. C. Providing equal pay for work of equal value within the organization, regardless of the job or department. D. Aligning compensation with the strategic goals and financial capabilities of the organization. None 1 out of 20 Time is Up! Time's up
