CHRP Total Rewards and Compensation 3

Question 1

Which retirement plan type requires the employer to contribute a defined contribution annually, with the employee bearing the investment risk?

Accepted Answer

Defined contribution plan

Answer

In a defined contribution plan, the employer contributes a set amount and the employee's retirement benefit depends on investment performance.

Question 2

A sales incentive plan pays a higher commission rate after a salesperson exceeds their quota. This structure is known as a:

Accepted Answer

Progressive commission

Answer

A progressive (accelerator) commission pays increasing rates as sales volume exceeds quota, incentivizing over-achievement.

Question 3

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?

Accepted Answer

Equal pay

Answer

The Equal Pay Act of 1963 mandates equal pay for substantially equal work, focusing on job content rather than job titles.

Question 4

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?

Accepted Answer

15%

Answer

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.

Question 5

What is the primary purpose of a salary survey lag strategy?

Accepted Answer

To delay implementing market adjustments until after the next survey cycle

Answer

A lag strategy means the organization waits until after survey data is published to adjust pay, resulting in temporarily below-market rates.

(CHRP) Certified Human Resources Professional Practice Test

(CHRP) Certified Human Resources Professional Practice Test

CHRP Total Rewards and Compensation 3