Human Resources Exam 3 Chapters: 10,11,12,13, & 14

Voluntary vs. involuntary turnover

Voluntary: initiated by the employee

Involuntary: initiated by the organization

Employment at will

Either an employee or an employer can sever the employment relationship:

• At any time

• For any reason

• With or without notice

Employment at will exceptions – be able to recognize which is which

Violation of Public Policy (legally required to do)

• Refusing to commit a crime

• Reporting criminal activity (whistle-blowing)

• Reporting unsafe or unethical practices

• Refusing to support management’s politics

• Complying with a summons to jury duty

Violation of Implied Contract

• When an employee is terminated despite the employer’s promise of job security, or contrary to promised guidelines

ADR (alternative dispute resolution) – purpose, steps

4 – stages

• Arbitration

• Mediation

• Peer Review

• Open Door Policy

Organizational commitment definition

The degree to which an employee identifies with the organization and willing to put effort on its behalf

Job withdrawal defined

Signs of employees leaving the company

Behavior change

• Confrontation

• Grievances

• Whistleblowing

Physical job withdrawal

• Internal transfer

• Call-offs

• Resignation

Psychological job withdrawal

• Low job involvement

• Low organizational commitment

Outplacement – purpose

Finding a job for long-term employees that were let go when they’re not at fault

WARN purpose

WARN: Workers’ Adjustment Retraining and Notification Act

• Employers with 100 or more employees must give 60 days’ notice of any closure or layoff in the following situations:

• Plant closing impacting 50 or more employees during any 30-day period

• Mass layoff during any 30-day period of at least: (1) 500 employees, or; (2) 50 to 499 workers if they make up at least 33% of the employer's workforce

Red Hot Stove rule – 4 components

How you should discipline people:

• With warning

• Immediate

• Impersonal

• Consistent

Compensable factors definition

The characteristics of jobs that an organization values and chooses to pay for

• Responsibility

• Accountability

• Experience

• Education

• Working conditions

• Travel

Broad band definition

Delayering (broad - banding): reducing the number of job levels (Fewer salary grades)

Exempt vs. nonexempt status

Exempt Employees: These employees are not entitled to overtime pay. They typically receive a fixed salary

Nonexempt Employees: These employees must be paid overtime for any hours worked beyond 40 hours per week (often hourly employees)

Davis-Bacon Act provisions

Davis – Bacon Act of 1931

• Applies only to government construction contractors

• Must be paid prevailing community rates

• Overtime pay of 1.5x for over 40 hours in a week

FLSA – Fair Labor Standards Act

FAIR LABOR STANDARDS ACT (FLSA) - 1938

• Administered by Department of Labor (Wage & Hour Division)

• Established minimum wage

• Overtime pay for hours worked >40

Job evaluation definition

An administrative procedure that measures a job's worth to the organization

Benchmarking

Avoiding anti-trust concerns:

• Compensation surveys must be managed by a third party. HR professionals cannot conduct formal or informal salary surveys on their own.

Minimum wage

FLSA (Fair Labor Standards Act) established law minimum wage is $7.25 per hour

Employee stock ownership (forms of)

Stock options give employees the opportunity to buy company stock at a previously fixed price.

Employee stock ownership plans (ESOPs) give employers certain tax and financial advantages when stock is granted to employees. These plans are often used as a benefit to align employee interests with company success, boost motivation, and provide financial rewards

Compa-ratio definition; how companies use it

They use it to determine if people are too high or too low in the salary range

• impacts people’s salary increases

• actual average pay for grade/ intended pay (pay grade midpoint)

Gainsharing plans – definition and purpose

Is a form of compensation based on group or plant performance rather than organization wide

• Offers a means of sharing productivity gains with employees

• Payouts are not deferred

• Improve performance

Incentive pay

compensation designed to motivate employees by rewarding performance. It can be financial or non-monetary and is often tied to specific goals or achievements

Merit pay

Link performance appraisal ratings to annual pay increases

• Increases determined by two factors:

• Performance rating

• Position in pay range (Compa-ratio)

• Actual pay/pay grade midpoint

Reasons for growth of employee benefits through the years

• Social Security, Unemployment Insurance, Workers’ Comp

• Wage controls instituted during WWII

• Tax treatment of benefits programs

• Cheaper to give benefits than to increase salary

Discretionary vs. non-discretionary benefits

 Discretionary: optional perks that employers provide at their own discretion. They are not legally required and can vary based on company policies

• Protection from financial disaster

• Avoid excessive expense of individual policies

Non-discretionary:

• Benefits that employers are obligated to provide, either due to legal requirements or company policy

Social Security – normal retirement age

67 years of age

Unemployment insurance - how it’s paid for, eligibility

Paid for by the employer’s taxes

• Offset lost income during involuntary unemployment

• Help unemployed workers find new jobs

• Provide incentives for employers to stabilize employment

• Preserve investments in skills by providing workers with income during short-term layoffs

Workers’ Compensation purpose, how it’s paid for

Paid for by employer premium injured or industrial illness

•   Pays benefits for work-related injuries, accidents, illnesses and death

What is COBRA?

Consolidated Omnibus Budget Reconciliation Act (COBRA)

• The 1985 act that requires employers to permit employees to extend their health insurance coverage at group rates for up to 36 months following a qualifying event, such as a layoff.

PBGC characteristics

PENSION BENEFIT GUARANTY CORPORATION

• Created by ERISA

• Pays benefits for failed defined benefit plans

• Financed through employer-paid premium

• PBGC guarantees basic retirement benefits in case of plan financial difficulties

Defined benefit vs. defined contribution plan details

Defined benefit: Guarantees a specified retirement benefit level to employees

• Company bears investment risk.

• PBGC guarantees basic retirement benefit in case of plan financial difficulties.

• Deductible for employer; not taxable to employee until retirement

Defined contribution: Does not promise employees a specific benefit level upon retirement.

• Investment risk shifts to the employee.

• Contributions are usually in proportion to salary

• Employer may contribute, match, or neither.

Vesting defined

Employees gain ownership of certain benefits over time, such as retirement contributions or stock options

FMLA (Family and Medical Leave Act) provisions

Provides eligible employees with up to 12 weeks of unpaid, job-protected leave per year for specific family and medical reasons. It also ensures that employees maintain their group health benefits during their leave

Difference between craft and industrial unions

Craft: prioritize skill-based representation

• Represent workers with a specific skill or trade, such as electricians, carpenters, or plumbers.

• Membership is based on expertise in a particular craft, often requiring apprenticeships or certifications.

 

Industrial: prioritize industry-wide solidarity

• Represent all workers within an industry, regardless of skill level.

• Membership includes both skilled and unskilled workers in sectors like manufacturing or transportation.

Forms of union security (definitions for agency shop, closed shop, union shop, checkoff provision, maintenance of membership)

Agency shops: A union security provision that requires an employee to pay union membership dues but not to join the union

Closed shops: A union security provision requiring a person to be a union member before being hired. Illegal under NLRA (all closed shops are illegal)

Union shop: A union security provision that requires a person to join the union within a certain amount of time after being hired

Checkoff provision: A union contract provision that requires an employer to deduct union dues from employees’ paychecks

Right-to-work-laws: State laws that make union shops, maintenance of membership, and agency shops illegal

Maintenance of membership: Union rules requiring members to remain members for a certain period of time (e.g., the length of the union contract)

Know what right-to-work laws are

State laws that make union shops, maintenance of membership, and agency shops illegal

Trends in union membership (up? down?)

Has declined over the years

• Structural Changes in the Economy

• Increased Employer Resistance

• Substitution with HRM

• Substitution by Government Regulation

• Worker Views

• Union Actions