Total Rewards and Compensation Flashcards
7 cards from real CHRP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Total Rewards and Compensation flashcards as text
Which retirement plan type requires the employer to contribute a defined contribution annually, with the employee bearing the investment risk?
Answer: Defined contribution plan
In a defined contribution plan, the employer contributes a set amount and the employee's retirement benefit depends on investment performance.
A sales incentive plan pays a higher commission rate after a salesperson exceeds their quota. This structure is known as a:
Answer: Progressive commission
A progressive (accelerator) commission pays increasing rates as sales volume exceeds quota, incentivizing over-achievement.
Which pay equity concept requires that men and women receive equal pay for work requiring substantially equal skill, effort, and responsibility under similar working conditions?
Answer: Equal pay
The Equal Pay Act of 1963 mandates equal pay for substantially equal work, focusing on job content rather than job titles.
An employee stock purchase plan (ESPP) typically allows employees to buy company stock at a discount of up to what percentage under IRS Section 423?
Answer: 15%
IRS Section 423 allows qualified ESPPs to offer stock at a discount of up to 15% of the lower of the fair market value at the offering date or purchase date.
What is the primary purpose of a salary survey lag strategy?
Answer: To delay implementing market adjustments until after the next survey cycle
A lag strategy means the organization waits until after survey data is published to adjust pay, resulting in temporarily below-market rates.
Which benefit is classified as a legally required benefit under U.S. federal and state law?
Answer: Unemployment insurance
Unemployment insurance is a legally mandated benefit funded by employer payroll taxes under the Federal Unemployment Tax Act (FUTA) and state laws.
A red-circled employee's pay is above the maximum of their pay grade. Which action is most appropriate?
Answer: Freeze the employee's pay increases until the grade catches up
Red-circled employees typically have their pay frozen or increases withheld until the pay grade range is adjusted to encompass their salary.