HRCI Compensation and Benefits 3

Question 1

What is a 'short-term incentive' (STI) plan?

Accepted Answer

A bonus program tied to achieving performance goals within a year or less

Answer

Stock options vesting over five years

Answer

A deferred compensation arrangement

Answer

A signing bonus paid at hire

Question 2

What is 'broadbanding' in pay structure design?

Accepted Answer

Collapsing many narrow pay grades into fewer, wider salary bands

Answer

Expanding the number of pay grades

Answer

Using geographic differentials to adjust base pay

Answer

Paying all employees at the same rate

Question 3

Which benefit is typically excluded from the FLSA's regular rate calculation for overtime purposes?

Accepted Answer

Gifts and payments for occasional periods when no work is performed

Answer

Production bonuses

Answer

Shift differentials

Answer

Commission payments

Question 4

What is an 'Employee Stock Purchase Plan (ESPP)'?

Accepted Answer

A program allowing employees to purchase company stock at a discounted price

Answer

A retirement plan where the employer contributes company stock

Answer

A deferred bonus paid in stock after a vesting period

Answer

A mandatory payroll deduction for government savings bonds

Question 5

Under the Equal Pay Act, when can employers pay different wages for equal work?

Accepted Answer

When differences are based on seniority, merit, quantity/quality of production, or a factor other than sex

Answer

Only when approved by the EEOC

Answer

Never — equal work must always receive equal pay

Answer

Only for jobs covered by a collective bargaining agreement

Question 6

What does 'pay transparency' mean in modern compensation practice?

Accepted Answer

Openly communicating pay ranges, structures, or individual salaries to employees and/or applicants

Answer

Publishing executive salaries in the annual report only

Answer

Disclosing pay information exclusively to the HR department

Answer

Automatically adjusting pay to match competitor rates