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Question 1

Under the FLSA, which test is NOT one of the standard exemption tests for the executive exemption?

Accepted Answer

Tenure test

Answer

The executive exemption requires meeting the salary basis, salary level, and duties tests, but there is no tenure test.

Question 2

A company pays employees a flat amount per geographic area regardless of role. This best describes which pay strategy component?

Accepted Answer

Geographic differential

Answer

A geographic differential adjusts pay based on the cost of labor or living in a specific location.

Question 3

Which type of benefit is mandated by federal law in the United States?

Accepted Answer

Social Security contributions

Answer

Social Security (and Medicare) contributions are legally mandated, while the others are voluntary employer-provided benefits.

Question 4

An employee earns more than the maximum of their pay range due to a prior salary. What is this situation called?

Accepted Answer

Red circle rate

Answer

A red circle rate occurs when an employee's pay exceeds the maximum of the assigned range.

Question 5

What does a compa-ratio of 0.85 indicate about an employee's pay?

Accepted Answer

Pay is 85% of the range midpoint

Answer

A compa-ratio of 0.85 means the employee is paid 85% of the range midpoint.

PHR Practice Test