Compensation and Benefits Flashcards

Under the FLSA, which test is NOT one of the criteria for an employee to qualify for the executive exemption?

Answer: The longevity test

The executive exemption requires the salary basis, salary level, and duties tests; there is no longevity test.

A compensation structure with overlapping pay grades that are very wide and few in number is best described as:

Answer: Broadbanding

Broadbanding consolidates many narrow grades into a few wide bands to allow flexibility.

When a long-tenured employee's pay is close to or higher than a newly hired employee's pay for similar work, this is called:

Answer: Pay compression

Pay compression occurs when little difference exists between the pay of new and experienced employees.

Which federal law requires employers to provide continuation of group health coverage after qualifying events such as termination?

Answer: COBRA

COBRA allows employees and dependents to continue group health coverage temporarily after qualifying events.

An employee earning $1,000/week works 50 hours under a fluctuating workweek agreement. The overtime is calculated using which multiplier on the regular rate?

Answer: 0.5

Under the fluctuating workweek method, overtime is paid at half-time (0.5) because straight time already covers all hours.

Which type of benefit is legally required (mandatory) for most U.S. employers?

Answer: Social Security contributions

Social Security (and Medicare) contributions are legally mandated, unlike the discretionary benefits listed.

A compensation philosophy of 'leading the market' means an employer:

Answer: Pays above the market median

A lead strategy sets pay above the market median to attract and retain top talent.