aPHR Compensation and Benefits 2 — Questions and Answers
Question 1: Which federal law requires employers to provide unpaid, job-protected leave for certain family and medical reasons?
- ERISA
- COBRA
- FMLA (Correct answer)
- FLSA
Correct answer: FMLA
The Family and Medical Leave Act (FMLA) entitles eligible employees to up to 12 weeks of unpaid, job-protected leave per year.
Question 2: A company wants to tie employee pay directly to individual output units produced. Which pay structure best fits this approach?
- Merit pay
- Piece-rate pay (Correct answer)
- Broadbanding
- Step increases
Correct answer: Piece-rate pay
Piece-rate pay compensates employees a fixed amount for each unit they produce, directly linking pay to output.
Question 3: What is the primary purpose of a 401(k) plan?
- Provide short-term disability income
- Allow employees to save pre-tax income for retirement (Correct answer)
- Fund employer health insurance premiums
- Cover workers' compensation claims
Correct answer: Allow employees to save pre-tax income for retirement
A 401(k) is a defined contribution retirement plan allowing employees to contribute pre-tax earnings, reducing current taxable income.
Question 4: Which concept describes the legal requirement that men and women in the same establishment performing substantially equal work must receive equal pay?
- Comparable worth
- Pay equity
- Equal Pay Act (Correct answer)
- Pay transparency
Correct answer: Equal Pay Act
The Equal Pay Act of 1963 prohibits wage discrimination based on sex for substantially equal work performed under similar conditions.
Question 5: An employer offers a flexible spending account (FSA). What is a key characteristic of an FSA?
- Funds roll over indefinitely each year
- Contributions are made post-tax
- Unused funds are typically forfeited at year-end (Correct answer)
- Only employers can contribute to FSAs
Correct answer: Unused funds are typically forfeited at year-end
FSAs operate on a 'use-it-or-lose-it' rule where unused funds generally must be forfeited at the end of the plan year.
Question 6: Which term describes pay increases given to all employees regardless of performance, typically tied to cost-of-living adjustments?
- Merit increases
- General increases (Correct answer)
- Incentive pay
- Variable pay
Correct answer: General increases
General increases (or across-the-board increases) are given to all employees and are often linked to inflation or cost-of-living changes.
Question 7: Under the ACA, employers with 50 or more full-time equivalent employees must offer affordable health coverage or face penalties. What is this requirement called?
- Individual mandate
- Employer shared responsibility provision (Correct answer)
- COBRA continuation
- HIPAA portability rule
Correct answer: Employer shared responsibility provision
The Employer Shared Responsibility Provision (Play or Pay) under the ACA requires applicable large employers to offer minimum essential coverage or pay penalties.
aPHR Compensation and Benefits 2
Which federal law requires employers to provide unpaid, job-protected leave for certain family and medical reasons?