Compensation & Benefits Flashcards

What is the purpose of a salary survey in compensation management?

Answer: To gather market data on competitive pay rates for benchmarking job positions

Salary surveys collect pay data from multiple employers to help organizations benchmark their compensation against the market.

Under ERISA (Employee Retirement Income Security Act), what are plan fiduciaries required to do?

Answer: Act in the best interest of plan participants and beneficiaries

ERISA requires plan fiduciaries to act solely in the interest of participants and beneficiaries when managing retirement and benefit plans.

What is a 'defined contribution' retirement plan?

Answer: A plan where employer and/or employee contribute fixed amounts and the retirement benefit depends on investment performance

In a defined contribution plan (like a 401(k)), contributions are fixed but the ultimate benefit depends on investment returns.

What is 'pay equity' analysis?

Answer: Evaluating whether employees receive equal pay for equal work regardless of protected characteristics

Pay equity analysis identifies and corrects unjustified pay disparities between employees in similar roles based on gender, race, or other protected characteristics.

What does 'vesting' mean in the context of employer retirement contributions?

Answer: The period over which employees earn ownership of employer-contributed retirement funds

Vesting schedules determine when employees gain full ownership of employer contributions to their retirement account.

Under the ACA, what employer mandate applies to companies with 50+ full-time equivalent employees?

Answer: Offer affordable minimum essential health coverage or face potential penalties

The ACA's employer shared responsibility provision requires applicable large employers to offer affordable health coverage or pay an employer shared responsibility payment.