Total Rewards & Pay Philosophy Flashcards
7 cards from real CPM 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 & Pay Philosophy flashcards as text
A company performs a pay equity audit and finds women in a role earn 92 cents for every dollar men earn. What is the FIRST step HR should take?
Answer: Conduct a regression analysis to identify legitimate and illegitimate drivers of the gap
Before taking corrective action, HR must determine whether the gap is explained by legitimate factors (tenure, performance, location) or reflects discrimination.
Which pay structure element defines the minimum and maximum salary an employer will pay for a specific role?
Answer: Salary range
A salary range establishes the minimum, midpoint, and maximum pay for a role, guiding hiring and merit decisions within that structure.
An employee's compa-ratio is 0.85. What does this indicate?
Answer: The employee is paid 15% below the pay range midpoint
A compa-ratio below 1.0 means the employee's salary is below the midpoint of their pay range, suggesting room for advancement within the grade.
What is the primary risk of relying solely on external market data when setting pay?
Answer: It may create internal inequity by ignoring the relative value of jobs internally
Pure market pricing can create internal inequity when external benchmarks don't reflect the relative importance of roles within the specific organization.
A 'pay for skills' compensation approach primarily rewards employees for:
Answer: The number of competencies or skills they have mastered
Skill-based pay increases compensation as employees acquire and demonstrate additional verified skills or competencies, encouraging workforce versatility.
Which of the following best describes the concept of 'total remuneration' in a global compensation context?
Answer: All cash and non-cash rewards including benefits, perks, and work environment
Total remuneration encompasses every element of value an employee receives: pay, benefits, incentives, intangibles, and the work experience itself.
When a job evaluation method ranks positions by comparing them to each other rather than a fixed standard, this is called:
Answer: Ranking method
The ranking method orders all jobs from highest to lowest value by comparing them against each other, without using a predefined point scale.