Market Pricing & Salary Surveys 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 Market Pricing & Salary Surveys flashcards as text
In a salary survey context, 'base salary' differs from 'total cash compensation' in that total cash compensation also includes:
Answer: Short-term incentives and bonuses paid during the year
Total cash compensation adds short-term variable pay (bonuses, incentives) to base salary, while benefits and equity are separate elements.
When market data shows that a job's market rate has moved outside the current pay grade's range, the compensation professional should consider:
Answer: Regrading the job or updating the pay range to reflect current market rates
When market rates diverge significantly from the pay range, the range or grade assignment should be reviewed and updated.
Which of the following is an example of 'red-circled' pay?
Answer: An employee's salary that exceeds the maximum of their pay grade
Red-circled employees are paid above the range maximum, typically due to demotions, restructuring, or range compression.
A compensation analyst is told to use the 'survey scope cut' for companies with revenues between $500M and $2B. This is done to:
Answer: Ensure the market data reflects organizations of comparable size and complexity
Scoping survey data by revenue size ensures pay comparisons are made against organizations with similar scale and job complexity.
Which of the following best describes 'salary survey aging' combined with 'geographic differential' in practice?
Answer: First age the national survey data to the current date, then apply the geographic differential to localize the rate
Standard practice is to age the survey data forward first, then apply geographic differentials to produce a current, location-specific market rate.
Which federal antitrust guideline is relevant when companies share compensation data through salary surveys?
Answer: Data must be at least 3 months old, from 5+ employers, with no single employer representing more than 25% of any data point
The DOJ/FTC safe harbor requires old data, minimum participants, and no dominance by one employer to prevent anticompetitive coordination.
A pay range 'spread' of 50% means that:
Answer: The range maximum is 50% higher than the range minimum
A 50% spread means the maximum is 1.5 times the minimum (e.g., min $40K, max $60K).