OCPS Employee Compensation & Benefits Administration 3 — Questions and Answers
Question 1: Which method of wage payment is permissible under the FLSA when calculating overtime for a nonexempt employee who works two different jobs at different rates for the same employer in the same week?
- Rate-in-effect method only
- Weighted average method only
- Either the rate-in-effect or weighted average method with prior agreement (Correct answer)
- Only the higher of the two rates
Correct answer: Either the rate-in-effect or weighted average method with prior agreement
The FLSA permits either the rate-in-effect or the weighted average method when a nonexempt employee works at two or more different rates, provided there is a prior agreement.
Question 2: A dependent care FSA allows employees to set aside pre-tax dollars for eligible expenses. What is the maximum annual employee contribution limit for a married couple filing jointly in 2024?
- $2,500
- $5,000 (Correct answer)
- $7,500
- $10,000
Correct answer: $5,000
The dependent care FSA limit is $5,000 per household for married couples filing jointly ($2,500 if married filing separately).
Question 3: Under COBRA, how long must continuation coverage generally be offered to a qualified beneficiary who loses coverage due to a covered employee's voluntary termination of employment?
- 12 months
- 18 months (Correct answer)
- 29 months
- 36 months
Correct answer: 18 months
Voluntary termination or reduction in hours is a qualifying event that triggers an 18-month COBRA continuation period.
Question 4: A nondiscretionary bonus paid for the prior quarter must be included in the regular rate of pay for overtime purposes. How is it allocated when the bonus period spans multiple workweeks?
- Added entirely to the workweek in which it is paid
- Equally divided over the workweek with the most overtime hours
- Apportioned back over all workweeks of the period it was earned (Correct answer)
- Excluded from the regular rate as a special payment
Correct answer: Apportioned back over all workweeks of the period it was earned
A nondiscretionary bonus earned over multiple workweeks must be apportioned back to each workweek of the bonus period and overtime recalculated.
Question 5: Which type of deferred compensation plan is governed by IRC Section 457(b) and is available only to state and local government employers and certain tax-exempt organizations?
- 401(k) plan
- 403(b) plan
- Eligible deferred compensation plan (Correct answer)
- SIMPLE IRA
Correct answer: Eligible deferred compensation plan
Section 457(b) eligible deferred compensation plans are available exclusively to governmental and certain tax-exempt employers.
Question 6: An employee is paid a guaranteed salary of $800/week and also earns piece-rate pay. Under the FLSA fluctuating workweek method, the overtime premium is calculated as:
- 1.5 times the regular rate for all overtime hours
- 0.5 times the regular rate for all overtime hours (Correct answer)
- 2 times the piece-rate for all hours over 40
- 1.5 times the piece-rate for all hours over 40
Correct answer: 0.5 times the regular rate for all overtime hours
Under the fluctuating workweek method, since straight-time for all hours is already included in the salary, only a 0.5× overtime premium is owed for hours over 40.
Question 7: Which federal law requires employers with 100 or more employees to provide 60 days' advance notice before a plant closing or mass layoff?
- ERISA
- WARN Act (Correct answer)
- COBRA
- FMLA
Correct answer: WARN Act
The Worker Adjustment and Retraining Notification (WARN) Act mandates 60 days' notice for covered plant closings and mass layoffs.
OCPS Employee Compensation & Benefits Administration 3
Which method of wage payment is permissible under the FLSA when calculating overtime for a nonexempt employee who works two different jobs at different rates for the same employer in the same week?