SPHR Total Rewards 4

Question 1

The Affordable Care Act (ACA) employer mandate requires applicable large employers (ALEs) to offer minimum essential coverage or face potential penalties. An ALE is generally defined as an employer with:

Accepted Answer

50 or more full-time equivalent employees

Answer

Under the ACA, an ALE is an employer that employed an average of at least 50 full-time equivalent employees in the prior calendar year.

Question 2

A pay-for-performance program that ties individual incentive payouts to both individual and organizational results is known as:

Accepted Answer

A balanced scorecard incentive plan

Answer

A balanced scorecard incentive plan links payouts to performance across multiple dimensions including individual, team, and organizational metrics.

Question 3

Which pay equity analysis technique compares salaries of similarly situated employees by regressing pay against legitimate factors such as job level, tenure, and performance to identify unexplained gaps?

Accepted Answer

Regression-based pay equity audit

Answer

Regression-based pay equity audits statistically control for legitimate pay factors to identify unexplained variance that may indicate discriminatory pay disparities.

Question 4

An employee stock purchase plan (ESPP) that qualifies under Section 423 of the IRC allows employees to purchase company stock at a discount. The maximum allowable discount under a qualified ESPP is:

Accepted Answer

15%

Answer

Under IRC Section 423, a qualified ESPP may offer employees a maximum discount of 15% off the stock's fair market value.

Question 5

A company is designing a long-term incentive plan for senior executives. Which vehicle best aligns executive interests with long-term shareholder value creation?

Accepted Answer

Restricted stock units (RSUs) with a three-year cliff vesting schedule

Answer

RSUs with multi-year vesting tie executive wealth directly to stock performance over time, aligning executive and shareholder interests.

SPHR - Senior Professional in Human Resources Practice Test

SPHR - Senior Professional in Human Resources Practice Test

SPHR Total Rewards 4