C1 Exam Training Practice Tests (WorldatWork Regulatory Environments for Compensation Programs)]

Question 1

Which employees are covered by the National Labor Relations Act?

A. Airline and railroad employees B. Employee who work for companies that sell goods in various states C. City, state and federal government employees

Correct Answer: B

Question 2

To establish disparate treatment in violation of Title VII of the Civil Rights Act of 1964, an employee must prove that the employer intentionally maintains the pay disparity because the employee is a member of a protected class and which of the following?

A. The employer maintains a wage disparity between employees who do unequal, but comparable work. B. He or she is paid less than employees who are not members of the same protected group. C. He or she receives a lower wage than a co-worker of the opposite sex.

Correct Answer: B

Question 3

Which of the following best describes the most likely perspectives of different groups in the organization that compensation professionals must be aware of?

A. Operating departments view compensation as it applies to them, HR must balance available resources to attract, retain and motivate employees and Finance knows the value of a motivated workforce and will provide the budget necessary to achieve it. B. Investors want to maximize gains and want to see compensation tightly controlled and Legal needs to ensure that compensation plans do not attract undue scrutiny. C. Investors and Finance want to see money spent wisely. Legal must ensure compliance, and HR and operating departments want to see their needs taken into account to attract, retain and motivate a high quality workforce. D. Operating departments and HR understand the company must live within its means and Finance cannot allocate funds to a budget if it is likely that profitability will be adversely affected.

Correct Answer: C

Question 4

Regarding presentations to executives, which of the following is most accurate?

A. Leave backup data out of the presentation so there is time to develop an effective response to unexpected questions B. Keep them brief C. Use multiple media D. Include all details related to the issue

Correct Answer: B

Question 5

Upon which criterion are step increases typically based?

A. Individual performance B. Skills C. Longevity D. Market adjustment

Correct Answer: C

Question 6

What best describes an effective core technique for communicating with executives?

A. Provide a wide range of facts and figures. With their high level of responsibility, executives must have all the data before they can make informed decisions. B. Focus on negative issues first, such as compensation costs exceeding budget, to get their attention C. Recommend a solution that will solve the issue and explain why it is the best solution available. D. Assume they have little knowledge of the issue and make a detailed presentation leading up to the purpose of the meeting.

Correct Answer: C

Question 7

What do profits, equity and debt all have in common?

A. They all incur the same costs to the business. B. Nothing. Each of these is a different financial metric. C. They are all sources of capital. D. They are all reported on the balance sheet.

Correct Answer: C

Question 8

On what basis does the Equal Pay Act of 1963 prohibit an employer from discriminating in employee compensation programs?

A. Age B. Religion C. Race D. Sex

Correct Answer: D

Question 9

What statement is most accurate regarding communication of compensation information?

A. The ready availability of information online has made it unnecessary for compensation professionals to tailor messages since individuals can research terms and concepts after the fact if they don't understand a communication. B. Compensation professionals should anticipate the level of the audience and tailor messages to their needs. C. Compensation terms are well-known and easily understood by most stakeholders. D. Compensation terms and practices are unclear to most individuals who do not work in this area and communication should be tailored to the least informed member of the target audience.

Correct Answer: B

Question 10

Your company has had a strong fiscal year with a 15% increase in net income over the prior fiscal year. Share prices are at an all time high. Working with Finance, you have arrived at a 2.5% merit increase budget for the next fiscal year, a smaller increase than the last fiscal year. Finance has indicated that some large capital expenditures will be needed next year, so the company needs to conserve resources. Additionally, Legal is in final negotiations on a lawsuit that may be very costly to the company. Word of the smaller increases has line management concerned that they will lose their best performers. Given all of these factors, what is your best course of action?

A. Implement the merit increase budget as is because the anticipated financial obligations have made it necessary B. Recommend a reduction in force to eliminate poor performers, which will increase the merit budget by reducing headcount C. Gather the perspectives of all stakeholders, analyze their individual concerns and meet to determine whether a compromise solution is possible D. Meet with Finance and make a case for a larger merit increase budget because the loss of key talent will cost more over the long term than the savings from the smaller merit increases

Correct Answer: C

WorldatWork Regulatory Environments for Compensation Programs - C1 Exam Practice Test