CHRP Total Rewards and Compensation 2

Question 1

A company wants to ensure its base pay is competitive. Which market pricing approach compares jobs based on actual duties rather than job titles?

Accepted Answer

Content-based matching

Answer

Content-based matching evaluates jobs by comparing actual duties and responsibilities to benchmark jobs in salary surveys, not just titles.

Question 2

Which pay structure element defines the range of pay for a specific job grade, typically expressed as a minimum, midpoint, and maximum?

Accepted Answer

Pay grade range

Answer

A pay grade range sets the boundaries (minimum, midpoint, maximum) for compensation within a specific grade level.

Question 3

An employee earning $45,000 is in a pay grade with a midpoint of $50,000. What is their compa-ratio?

Accepted Answer

90%

Answer

Compa-ratio = actual pay ÷ midpoint × 100 = $45,000 ÷ $50,000 × 100 = 90%.

Question 4

Under the Fair Labor Standards Act (FLSA), which test component examines whether an employee's primary duty is management of the enterprise or a department?

Accepted Answer

Duties test — executive exemption

Answer

The executive exemption duties test requires that the employee's primary duty be management of the enterprise or a recognized department or subdivision.

Question 5

A broad-banding pay structure consolidates many pay grades into a few wide bands. What is a key disadvantage of this approach?

Accepted Answer

It can obscure career progression signals for employees

Answer

Broad bands can make it harder for employees to see clear career advancement milestones since many levels are collapsed into one wide range.

(CHRP) Certified Human Resources Professional Practice Test

(CHRP) Certified Human Resources Professional Practice Test

CHRP Total Rewards and Compensation 2