PHR Practice Test 1 — Questions and Answers

Question 1: When you compare your company's return on investment to that of the competition, you'll see that it's a little lower. What is the most effective course of action?

Compare the companies Return on Equity (ROE) with competitors.
Develop a new strategic plan for the business
Adjust the strategic plan to increase investment
Adjust the strategic plan to maximize the value of expenses. (Correct answer)

Correct answer: Adjust the strategic plan to maximize the value of expenses.

A lower Return on Investment (ROI) suggests the company isn't generating sufficient profit relative to its investments compared to competitors. To improve ROI, a company can either increase revenue or decrease costs. Adjusting the strategic plan to maximize the value of expenses directly addresses the cost side, aiming to achieve more output for the same or less expenditure, thereby enhancing ROI.

Question 2: According to which motivation theory, employees are motivated by success, but they weigh the expected benefit against the effort required to accomplish it?

McGregor's Theory X and Theory
Vroom's expectancy theory (Correct answer)
McClelland's acquired needs theory
Maslow's hierarchy of need theory

Correct answer: Vroom's expectancy theory

Vroom's expectancy theory posits that individuals are motivated when they believe their effort will lead to good performance, that good performance will be rewarded, and that these rewards are desirable. This directly aligns with the idea of employees weighing expected benefits against the effort required to achieve success.

Question 3: Which of the following is a SMART goal's element?

Action-oriented (Correct answer)
Intentionally imprecise
Technological
Generally stated

Correct answer: Action-oriented

SMART is an acronym for Specific, Measurable, Achievable, Relevant, and Time-bound. 'Action-oriented' aligns with the 'A' in SMART, emphasizing that goals should describe specific actions to be taken. This ensures goals are practical and guide concrete efforts.

Question 4: You want to build and maintain a strong sense of ethics inside an organization as an HR professional. One efficient method is to:

Write a corporate ethics statement
Ignore unethical behavior
Establish a code of conduct (Correct answer)
Develop new recruitment procedures

Correct answer: Establish a code of conduct

Establishing a code of conduct clearly outlines the expected ethical behaviors and standards for all employees within an organization. This provides a formal framework and guidance, which is crucial for building and maintaining a strong ethical culture. It offers actionable guidelines beyond a general ethics statement.

Question 5: What is the name given to an employee who files a complaint with a federal agency alleging that their employer has engaged in illegal activity?

Flag-waver
Evaluator
Reporter
Whistle-blower (Correct answer)

Correct answer: Whistle-blower

A 'whistle-blower' is an individual who exposes information about illegal or unethical activities within a private or public organization. This term specifically describes an employee reporting an employer's illegal activity to an external federal agency.

Question 6: People form a variety of organizations to achieve their commercial objectives. Which of the following types of business organizations protects the owners from the company's debts and liabilities?

Sole Proprietorship
Corporation (Correct answer)
Partnership
None ot the above

Correct answer: Corporation

A corporation is a legal entity separate from its owners (shareholders), providing them with limited liability. This means the owners' personal assets are generally protected from the company's debts and legal liabilities, unlike sole proprietorships or partnerships.

Question 7: As part of a marketing strategy, a restaurant launches a new happy-hour. The owner wants to know if the marketing helped sales a year later. Which form of strategic planning statistic can be used to compare sales from the prior year to the current year?

Opportunity success rate
Innovation rate
Return on investment
Gross profit margin (Correct answer)

Correct answer: Gross profit margin

Gross profit margin measures the percentage of revenue left after deducting the cost of goods sold. Comparing the gross profit margin year-over-year would directly show if the happy-hour marketing strategy led to an increase in profitable sales, thus indicating its effectiveness in improving the restaurant's financial performance.

Question 8: Why is it so important to ask valid questions during an interview?

To ensure that the candidate is like the interviewer.
To ensure the candidate has been successful in unrelated jobs.
To ensure the interview relates to the specific job. (Correct answer)
To ensure a potential employee fits in the organization.

Correct answer: To ensure the interview relates to the specific job.

Valid interview questions are those that are directly job-related and designed to assess a candidate's qualifications, skills, and experience pertinent to the specific role. This ensures fairness, reduces bias, and helps predict job performance, making the hiring process more effective and legally defensible.

Question 9: What federal legislation defines sexual harassment as a form of discrimination?

Fair Labor Standards Act
Equal Employment Opportunity Commission
Title VII - Civil Rights Act (Correct answer)
American Disabilities Act

Correct answer: Title VII - Civil Rights Act

Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, religion, sex, and national origin. The Supreme Court and the Equal Employment Opportunity Commission (EEOC) have interpreted 'sex' discrimination to include sexual harassment, making it illegal under this act.

Question 10: What is Executive Order 11246 purpose?

Established affirmative action (Correct answer)
Established the Fair Employment Practice Committee
Abolished discrimination in the US Armed Forces
Established overtime pay

Correct answer: Established affirmative action

Executive Order 11246, signed by President Lyndon B. Johnson in 1965, requires federal contractors and subcontractors to take affirmative action. This ensures that applicants are employed and employees are treated during employment without regard to their race, color, religion, sex, or national origin, establishing the foundation for affirmative action in federal contracting.

Question 11: Employers with 100 or more employees are obliged to file the EEO-1 (Employer Information Report). When is the deadline for submitting EEO-1 report component 1?

May 31 (Correct answer)
January 1
September 30
December 31

Correct answer: May 31

The deadline for submitting Component 1 of the EEO-1 report, which collects data on employee demographics by job category, race, ethnicity, and sex, is typically May 31st each year. This deadline applies to employers meeting the specified criteria of having 100 or more employees.

Question 12: Which of the following questions should be answered before choosing an HRIS system?

What information will be utilized by the HRIS?
How will the HRIS be used?
Who will have access to the information?
All of the above (Correct answer)

Correct answer: All of the above

Before selecting an HRIS, it's crucial to understand the system's purpose, how it will be used, and who will access the data. Answering 'What information will be utilized?', 'How will the HRIS be used?', and 'Who will have access?' ensures the chosen system meets organizational needs, integrates effectively, and complies with data security and privacy requirements.

Question 13: A nonexempt employee who normally works Monday through Friday from 8:00 a.m. to 5:00 p.m. travels on Sunday from 4:00 p.m. to 6:00 p.m. to attend a conference. For travel time, how many hours should the employee be compensated?

A)1 (Correct answer)
4
2
5

Correct answer: A)1

Under the Fair Labor Standards Act (FLSA), travel time that cuts across the employee's normal workday, even on a non-workday, is considered compensable work time. Since the employee's normal workday ends at 5:00 p.m., the travel from 4:00 p.m. to 5:00 p.m. on Sunday (one hour) falls within this window and is compensable. Travel outside of normal work hours on a non-workday is generally not compensable unless it's actual work performed.

Question 14: Which of the following is a direct compensation example?

Mobile phone
Health insurance
Vacation
Bonus (Correct answer)

Correct answer: Bonus

Direct compensation refers to the monetary payments employees receive for their work. Examples include wages, salaries, commissions, and bonuses. Health insurance, mobile phones, and vacation are considered indirect compensation or benefits, as they are non-monetary forms of reward.

Question 15: A non-exempt employee is participating in non-job-related professional training outside of normal working hours. The event will be documented as certified training on the employee's performance review. Should the employee be compensated for his or her attendance at the training?

No, it was voluntary.
No, it is not job related.
Yes. (Correct answer)
No, it is outside of normal work hours.

Correct answer: Yes.

Under FLSA guidelines, if an employer requires or strongly encourages an employee to attend training, even if it's outside normal work hours or not directly job-related, it is generally considered compensable time. The fact that it will be documented on the employee's performance review suggests it is not entirely voluntary or solely for the employee's benefit, thus making it compensable.

Question 16: Your employer provides medical benefits to military personnel, but does not provide the same benefits to women on maternity leave. This is a violation _______.

Davis-Bacon Act
The Pregnancy Discrimination Act (Correct answer)
Fair Labor Standards Act
Family Medical Leave Act

Correct answer: The Pregnancy Discrimination Act

The Pregnancy Discrimination Act (PDA) is an amendment to Title VII of the Civil Rights Act of 1964, specifically prohibiting discrimination based on pregnancy, childbirth, or related medical conditions. Denying medical benefits to women on maternity leave while providing them to others constitutes discrimination based on a pregnancy-related condition, directly violating the PDA. Employers must treat pregnant employees the same as other employees with similar abilities or inabilities.

Question 17: A hands-on experience demonstrates which type of learning.

Touch Learning
Kinesthetic Learning (Correct answer)
Auditory Learning
Visual Learning

Correct answer: Kinesthetic Learning

Kinesthetic learning is a learning style where individuals learn best through physical activity, hands-on experiences, and doing. A hands-on experience directly engages the learner physically and practically, allowing them to interact with the material. This method contrasts with visual learning (seeing) or auditory learning (hearing), making it a prime example of kinesthetic learning.

Question 18: There are four types of training evaluations, according to Kirkpatrick's model: reaction, learning, behavior, and.

Summation
Results (Correct answer)
Testing
Objectives

Correct answer: Results

Kirkpatrick's Four-Level Training Evaluation Model is a widely recognized framework for assessing the effectiveness of training programs. The four levels are: Reaction (how participants felt about the training), Learning (what participants learned), Behavior (how participants changed their behavior on the job), and Results (the impact on the organization, such as improved performance or ROI). 'Results' measures the ultimate value and outcomes of the training.

Question 19: Your company establishes a suggestion box where employees can anonymously submit ideas to executives and management. What is the best course of action for management to take in order for employees to recognize the program's value?

Organize the suggestions by type
Act quickly on the suggestions (Correct answer)
Discuss the suggestions
Share the suggestions with the entire organization

Correct answer: Act quickly on the suggestions

For an employee suggestion program to be effective and valued, employees need to see that their input leads to tangible actions and changes. Acting quickly on suggestions demonstrates that management takes employee ideas seriously and is responsive to feedback. This responsiveness builds trust, encourages continued participation, and reinforces the program's perceived value among employees.

Question 20: What is the deadline for bringing a charge of discrimination with the Equal Employment Opportunity Commission (EEOC)?

300 days
90 days
30 days
180 days (Correct answer)

Correct answer: 180 days

Generally, an individual must file a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) within 180 days from the date of the alleged discriminatory act. This deadline is crucial for initiating the legal process. In states with a state or local agency that enforces a law prohibiting discrimination on the same basis, this deadline can be extended to 300 days, but the standard federal period is 180 days.

Question 21: Which of the following offers an informal setting for a group of employees to meet with their manager in order to learn more about the company?

Brown-bag lunch program (Correct answer)
Word of mouth
Work team
Department staff meetings

Correct answer: Brown-bag lunch program

A brown-bag lunch program is an informal gathering where employees bring their own lunch and meet with a manager or executive. This setting encourages open dialogue, allows employees to ask questions directly, and learn more about the company in a relaxed, non-threatening environment. It fosters communication and provides a casual forum for information exchange that more formal meetings typically do not.

Question 22: In a hostile work environment, which of the following is true?

It only takes a single occurrence of harassment to create a hostile work environment.
Employers are protected from claims of harassment by an employment policy against discrimination.
Only a supervisor can create a hostile work environment.
A hostile work environment may arise when an employee witnesses the harassment of a co-worker. (Correct answer)

Correct answer: A hostile work environment may arise when an employee witnesses the harassment of a co-worker.

A hostile work environment is created when unwelcome conduct based on a protected characteristic becomes severe or pervasive enough to alter the conditions of employment and create an abusive working environment. This can occur not only when an individual is directly targeted but also when an employee witnesses the harassment of others. The observation of such conduct can make the overall environment intimidating, hostile, or offensive for the witness, thus contributing to a hostile work environment for them.

Question 23: A panel of arbitrators appointed by the parties to a dispute for the sole purpose of resolving such dispute is known as:

Arbitrator tribunal (Correct answer)
Compulsory arbitrator
Ad hoc arbitrator
Permanent arbitrator

Correct answer: Arbitrator tribunal

An arbitrator tribunal, also known as an arbitration panel, refers to a group of arbitrators (often three) appointed by the parties involved in a dispute. Their sole purpose is to hear the arguments and render a binding decision to resolve that specific dispute. This differs from a single arbitrator or a permanent arbitrator who might handle multiple cases over time.

Question 24: Terrorism, war, and arson fall into what category of disaster when conducting a risk assessment?

Environmental disasters
Equipment and System failure
Security threat
Organized or deliberate disruption (Correct answer)

Correct answer: Organized or deliberate disruption

When conducting a risk assessment for disaster planning, events like terrorism, war, and arson are categorized as organized or deliberate disruptions. These are intentional acts designed to cause harm, damage, or disruption to an organization's operations. This category distinguishes them from natural disasters (environmental) or accidental failures (equipment and system failure).

Question 25: How is the negotiating unit determined during the union-building process?

By the union and employees
By the National Labor Relations Board (Correct answer)
By the employees
By the union

Correct answer: By the National Labor Relations Board

During the union-building process, the National Labor Relations Board (NLRB) is the federal agency responsible for determining the appropriate bargaining unit. The NLRB ensures that the employees within the proposed unit share a 'community of interest,' meaning they have similar working conditions, skills, and interests, making the unit suitable for collective bargaining purposes.

PHR Practice Test 1

When you compare your company's return on investment to that of the competition, you'll see that it's a little lower.
What is the most effective course of action?