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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:

1. Internal process metrics are most useful in which of the following situations?

A) Determining employee satisfaction levels
B) Measuring the financial success of the business
C) Assessing how well the business is running
D) Evaluating customer perceptions of products or services

2. Employer-sponsored death benefits are most commonly based on which of the following?

A) The employee's premium contributions
B) The size of the employee's family
C) The employee's health history
D) The employee's annual salary

3. What statement is most accurate regarding compensation communications with employees at varying levels?

A) They generally require a greater degree of detail for lower level employees who have less of an understanding of pay plan design.
B) They usually require more detail for senior employees regarding plan details and performance and the needs from one employee group to another can vary greatly.
C) They should be kept to a minimum for employees at all levels to maximize efficiency and efforts can be focused only on those who have questions.
D) They tend to be fairly consistent because the elements of pay may differ, but the concerns are universal.

4. Which of the following statements best describes defined contribution (DC) plans?

A) The benefit is based on a formula that considers pay and service.
B) The employee assumes the risk for the investments.
C) They require complex actuarial calculations and assumptions.
D) They generally provide better benefits to employees with longer service.

5. Which statement is most accurate regarding the effect of taxation on the benefits that employers offer?

A) Taxation affects the level of benefits offered, the source of benefits and the employer/employee cost- sharing basis.
B) Taxation is the primary reason that employers offer benefits; in the absence of tax incentives, employers would be unlikely to offer them.
C) Taxation has no effect on employee benefits; employers offer benefits for competitive reasons only.

Solutions: