Total Rewards & Compensation Flashcards
6 cards from real SHRM-CP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Total Rewards & Compensation flashcards as text
Which compensation philosophy positions an organization's pay rates at or above the 50th percentile of the market?
Answer: Lead the market strategy
A lead-the-market strategy intentionally sets compensation above the median to attract and retain top talent.
A compa-ratio of 1.10 for an employee means:
Answer: The employee is paid 10% above the midpoint of their pay grade
A compa-ratio above 1.0 indicates the employee's pay exceeds the midpoint; 1.10 means 10% above the grade midpoint.
Which pay structure characteristic allows employees to progress through a wide salary band with few distinct pay grades?
Answer: Broadbanding
Broadbanding consolidates many narrow pay grades into a few wide salary bands, providing flexibility for lateral moves and varied skills.
The Equal Pay Act of 1963 requires equal pay for equal work. Which factors LEGALLY justify pay differences under this law?
Answer: Seniority, merit, quantity or quality of production, and any factor other than sex
The Equal Pay Act permits pay differentials based on seniority, merit, production-based systems, or any bona fide factor other than sex.
A defined benefit pension plan provides retirement income based on:
Answer: A formula using years of service and final average salary
Defined benefit plans calculate benefits using a predetermined formula, typically incorporating years of service and final or average salary.
Under the Fair Labor Standards Act (FLSA), which employee classification is exempt from overtime pay requirements?
Answer: Employees who meet the salary threshold and duties test for executive, administrative, or professional roles
FLSA exemption requires meeting both a minimum salary threshold AND a duties test for executive, administrative, or professional categories.