Compensation and Benefits Flashcards
7 cards from real APHR practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Compensation and Benefits flashcards as text
What is the primary difference between a defined benefit plan and a defined contribution plan?
Answer: Defined benefit plans guarantee a specific retirement income
A defined benefit plan promises a specific monthly benefit at retirement, while a defined contribution plan specifies only the amount contributed, not the eventual benefit.
Under FLSA, which of the following employees is most likely classified as exempt from overtime requirements?
Answer: A salaried marketing manager earning $60,000/year meeting duties tests
To be FLSA exempt, an employee must meet both the salary level test (currently $684/week) and a duties test for executive, administrative, or professional roles.
Which short-term incentive plan distributes a share of profits to employees based on company financial performance?
Answer: Profit-sharing plan
Profit-sharing plans distribute a portion of company profits to employees, typically annually, based on the company's financial results.
Pay compression most commonly occurs when:
Answer: New hire salaries approach or exceed those of longer-tenured employees
Pay compression happens when market rates for new hires rise faster than internal merit increases, narrowing the gap between new and tenured employee pay.
Which tax-advantaged account is paired exclusively with a High Deductible Health Plan (HDHP) and allows funds to roll over year to year?
Answer: HSA (Health Savings Account)
An HSA can only be paired with an HDHP, and unlike FSAs, unused funds roll over indefinitely and are owned by the employee.
A company grants employees the right to purchase company stock at a fixed price after a vesting period. What is this benefit called?
Answer: Stock option
Stock options give employees the right to buy company shares at a predetermined exercise price after meeting vesting requirements.
Which FLSA provision requires that the regular rate of pay for overtime calculation must include which type of compensation?
Answer: Non-discretionary bonuses
Non-discretionary bonuses (those promised in advance or tied to performance metrics) must be included in the regular rate when calculating overtime pay.