Benefits Design & Administration Flashcards
7 cards from real CCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Benefits Design & Administration flashcards as text
Which retirement plan design feature allows employees to make after-tax contributions so that qualified withdrawals in retirement are tax-free?
Answer: Roth 401(k) feature
A Roth 401(k) accepts after-tax employee contributions, and qualified distributions (after age 59½ and a 5-year holding period) are entirely tax-free, including earnings.
When conducting a benefits cost analysis, the 'total benefit cost as a percentage of payroll' metric is primarily used to:
Answer: Benchmark the overall cost burden of benefits relative to compensation expense
Expressing total benefit costs as a percentage of payroll provides a normalized metric that allows comparison against industry benchmarks and tracks how benefit spending relates to overall labor costs over time.
An employee assistance program (EAP) is primarily designed to:
Answer: Provide confidential counseling and referral services for personal problems
EAPs provide employees and their families with confidential short-term counseling, assessment, and referral services for personal, family, and work-related issues such as mental health, substance abuse, and financial stress.
The concept of 'adverse selection' in benefits administration refers to:
Answer: High-risk individuals disproportionately enrolling in richer benefit plans
Adverse selection occurs when sicker or higher-risk individuals are more likely to enroll in comprehensive benefit plans, driving up plan costs and creating an imbalanced risk pool.
Which vesting schedule requires employees to be 100% vested in employer retirement contributions after no more than three years of service?
Answer: Cliff vesting
Cliff vesting grants employees 0% ownership until reaching a specified service threshold, at which point they become 100% vested; ERISA allows cliff vesting at up to three years for most plans.
A total rewards statement given to employees primarily serves which purpose?
Answer: Communicating the full value of compensation and benefits to improve perceived value
A total rewards statement consolidates salary, bonuses, and the employer's cost of all benefits into a personalized document that helps employees understand the complete value of their compensation package.
Under the Family and Medical Leave Act (FMLA), eligible employees are entitled to how many weeks of unpaid, job-protected leave per year for qualifying reasons?
Answer: 12 weeks
FMLA entitles eligible employees of covered employers to up to 12 workweeks of unpaid, job-protected leave in a 12-month period for qualifying family and medical reasons.