Total Rewards & Compensation Flashcards

Which type of variable pay plan distributes a portion of company profits to eligible employees?

Answer: Profit-sharing plan

Profit-sharing plans distribute a percentage of organizational profits to employees, linking their reward to company-wide financial success.

Job evaluation using the point-factor method assigns value to jobs based on:

Answer: Compensable factors such as skill, effort, responsibility, and working conditions

The point-factor method identifies compensable factors, weights each factor, and assigns point values to quantify and rank job worth.

Total compensation cost per employee includes which components?

Answer: Base pay, variable pay, benefits, retirement contributions, and payroll taxes paid by the employer

Total compensation cost encompasses all direct and indirect compensation, including employer-paid taxes, benefits, and retirement contributions.

Which benefit is REQUIRED for employers under federal law in the United States?

Answer: Social Security and Medicare (FICA) contributions

FICA requires employers to withhold and match employee Social Security and Medicare taxes — this is a mandatory federal employer obligation.

A non-qualified deferred compensation plan differs from a qualified plan primarily because it:

Answer: Does not receive favorable tax treatment and is not subject to ERISA contribution limits

Non-qualified deferred compensation plans offer flexibility for key executives but lack the tax advantages and ERISA protections of qualified plans.

Which pay equity analysis technique compares compensation across demographic groups after controlling for legitimate pay factors?

Answer: Regression analysis

Regression analysis isolates unexplained pay gaps by statistically controlling for factors like tenure, performance, and job level to detect potential pay discrimination.