Deck 10: Employee Benefits

Question 1

In terms of cost control,the larger the cost of a benefit category,the greater the opportunity for savings.

Answer 1

True

Question 2

The employment insurance program is financed through federal and provincial taxes on both employees and employers.

Answer 2

False

Question 3

Employment Insurance benefits are typically about 50 percent of an eligible individual's previous earnings and last for 52 weeks.

Answer 3

False

Question 4

Employees can earn up to 60 percent of earnings (75 percent in Quebec)benefits from EI while on maternity or parental leave.As a result employers now offer "top-ups" to employees.

Question 5

To control health-care costs,employers have been increasingly shifting costs to employees through the use of deductibles,coinsurance,exclusions and limitations,and maximum benefits.

Question 6

Sick leave programs are employer-sponsored benefits plans that often provide full salary replacement for a limited period of time and which may be based on length of service.

Question 7

The Canada/Quebec Pension Plan (CPP/QPP)is a mandatory,government-sponsored pension plan funded by employers and employees.

Question 8

Defined contribution retirement plans insulate employees from investment risks,which are instead borne by the company.

Question 9

The two types of disability insurance are short-term disability plans and long-term disability plans.

Question 10

Increased employee mobility will reinforce the continued trend toward defined contribution plans,which have greater portability across employers.

Question 11

Vacation and other paid leave programs help attract and retain employees and they come at no additional cost to the organization.

Question 12

Private pension income represents the largest single component of an elderly person's overall retirement income.

Question 13

Research on the different types of wellness centers shows the cost of health education programs to be significantly more than those associated with fitness facility programs or follow-up models,but that follow-up models are the least effective of the three in reducing risk factors.

Question 14

The marginal tax rate is the percentage of an additional dollar of earnings that goes to taxes.

Question 15

One of the reasons for giving more responsibility to employees for retirement planning and other benefit decisions is to increase their awareness and understanding of such benefits.

Question 16

Benefits were never a key negotiation objective when dealing with unionized work environments.

Question 17

Insurance risks can be more easily pooled in smaller groups.

Question 18

Surveys indicate that pension programs are the most important benefit to the average person.

Question 19

Canadian employees can take maternity and parental leave for up to 45 weeks.

Question 20

Employers who do not meet their employees' expectations run the risk of violating an "implicit contract."

Question 21

The larger the cost of a benefit category,the greater the

A)benefit is to the employee
B)cost to the employee
C)cost to the employer
D)opportunity for savings

Question 22

Part-time employees receive about the same benefits as full-time employees when adjusted for hours worked.

Question 23

Surveys indicate that some companies are ending retiree health care benefits altogether.

Question 24

Survey information on competitors' benefits packages and information on benefits costs are available through all but one of the following sources.Name the exception.

A)Conference Board of Canada
B)Private Consulting Firms
C)Census Canada
D)Variety of Human Resources Associations

Question 25

While the number of mandatory days of vacation in Western Europe is about 30 days,however in Canada there is not a national minimum of mandatory days as they are mandated by

A)Provincial Employment Standards Acts
B)Human Resources Services Development Canada
C)Canadian Labour Commission
D)Each individual company

Question 26

As the new Senior Human Resources Specialist at Saskberta Inc.you have chosen to give employees more responsibility to the employees for their retirement planning and other benefits.You are doing this to

A)differentiate yourself with your competition.
B)remain competitive within your industry.
C)comply with the Employment Standards Act.
D)increase their understanding of the value of such benefits.

Question 27

_____ plans do not promise a specific benefit level for employees upon retirement.Rather,an individual account is set up for each employee with a guaranteed size of contribution.

A)Defined benefit
B)Term benefit
C)Defined contribution
D)Unspecified contribution

Question 28

_____ is significantly better in reducing the risk factors associated with cardiovascular disease.

A)The follow up model
B)Health education
C)A physical fitness facility
D)A passive wellness program

Question 29

Which of the following is NOT a type of defined contribution pension plan?

A)A money purchase plan
B)A profit-sharing plan
C)A gainsharing plan
D)An employee stock option plan

Question 30

The cost of benefits adds about what percent to every dollar of payroll?

A)27 percent
B)44 percent
C)50 percent
D)62 percent

Question 31

"Active" employee wellness programs

A)concentrate on physical exercise rather than awareness issues.
B)are health education programs designed to raise awareness levels of health-related issues and to inform employees on health-related topics.
C)are the most common form of employee wellness program.
D)assume that behaviour change requires not only awareness and opportunity,but support and reinforcement.

Question 32

Flexible benefit plans (also known as cafeteria-style plans)permit employees to choose the types and amounts of benefits they want for themselves.

Question 33

Benefit plans that permit employees to choose the types and amounts of benefits they want are called

A)preferred provider plans.
B)flexible,or cafeteria-style,benefits plans.
C)"pay or play" benefits plans.
D)flexible spending accounts.

Question 34

Short-term disability plans typically provide benefits for

A)3 months or less
B)6 months or less
C)9 months or less
D)12 months or less

Question 35

Research clearly shows that current employees,unlike job applicants,have a good idea of what benefits are in place and the cost or market value of these benefits.

Question 36

What is the earliest age at which an eligible worker can retire and still receive his or her CPP/QPP benefits?

A)55
B)60
C)62
D)65

Question 37

Which one of the following is NOT true of workers' compensation?

A)Employees are covered under the "no-fault" provision regardless of their behaviour.
B)Approximately 90 percent of all Canadian workers are covered by the system.
C)Benefits fall into four major categories: wage-loss benefits,health care,survivor benefits,and rehabilitative services.
D)Self-funding by employers is permitted in most Provinces.

Question 38

Employer use of increased deductibles,coinsurance payments,policy exclusions and limitations,and establishment of maximum benefits are examples of which of the following types of managed-care efforts?

A)Alternative funding methods
B)Plan design
C)Claims review
D)External cost-control systems

Question 39

The federal tax regulations requires flexible spending account funds to be earmarked in advance and spent during the plan year,with any remaining funds reverting to the employee.

Question 40

Which of the following is NOT typically a factor used to determine retirement benefit levels of employees under a defined benefit retirement plan?

A)Years of service
B)Number of dependents
C)Age
D)Wages or salary level

Question 41

Which of the following benefits is the most likely target for cost control by employees?

A)Life insurance benefits
B)Medical benefits
C)Employment insurance benefits
D)Pension benefits

Question 42

The employment insurance program is financed largely through federal and provincial funding supported by contributions through payroll deductions of

A)employees and employers.
B)employers only.
C)employees only.
D)all taxpayers.

Question 43

Funding of long-term disability plans has important ________ implications since benefits are _________ if the employer pays the premium.

A)tax;taxable
B)tax;not taxable
C)income;taxable
D)income;not taxable

Question 44

____________ is a government initiative linked directly with EI or QPIP benefits.

A)Enhanced Unemployment Benefit (EUB)
B)Supplemental Unemployment Benefit (SUB)
C)Enhanced Employment Benefit (EEB)
D)Supplemental Employment Benefit (SEB)

Question 45

The _____ tax rate is the percentage of additional earnings that goes to taxes.

A)marginal
B)net
C)gross
D)incremental

Question 46

Which of the following is NOT one of the major categories of workers' compensation?

A)Disability income
B)Death of spouse benefits
C)Medical care
D)Rehabilitative services

Question 47

A ______________ pension plan does not promise a specific benefit level for employees upon retirement.Rather,an individual account is set up for each employee to which the employer provides a guaranteed size of contribution.

A)defined-benefit
B)guaranteed-benefit
C)defined-contribution
D)guaranteed-contribution

Question 48

Drawbacks to employers of flexible benefits plans include all except which one of the following?

A)High initial design costs
B)High administrative start-up costs
C)Higher benefits costs
D)Adverse selection costs

Question 49

____________ are employer-sponsored benefit plans that often provide full salary replacement to employees for a limited period of time and which may be based on length of service.

A)Short term leave programs
B)Convalescence leave programs
C)Health improvement programs
D)Sick leave programs

Question 50

Which of the following is NOT a reason why group insurance rates are typically lower than individual rates?

A)Economies of Scale
B)The ability to pool risks
C)Disbursement of costs amongst the group
D)Greater bargaining power of a group

Question 51

The nature of the workforce can influence the kind of benefits provided.Which of the following benefits is most likely to attract a workforce with a high percentage of women of child bearing age?

A)Pensions
B)Life insurance
C)Medical coverage
D)Parental leave top-ups

Question 52

Which of the following media would you use in order to provide information on benefits and related changes to remote employees?

A)Meetings
B)Intranet
C)Enrolment packages
D)Teleconference messaging

Question 53

A ______________ pension plan is an employer-sponsored and registered pension plan that guarantees a specified retirement benefit level to employees based typically on a combination of years of service and age as well as on the employee's earnings level.

A)defined-benefit
B)guaranteed-benefit
C)defined-contribution
D)guaranteed-contribution

Question 54

Which of the following is an important phenomenon encountered in cost control efforts?

A)Piecemeal programs may not work well.
B)A large percentage of employees are responsible for generating the majority of health care costs.
C)Employees usually stick on to specific programs in spite of cost control efforts on account of the administrative issues.
D)Employees are willing to aid in cost cutting efforts by not making unnecessary claims.

Question 55

Which one,if any,of the following is an "active" wellness program?

A)Health education programs
B)Outreach,follow-up programs
C)Fitness facilities
D)Company gym

Question 56

In which of the following ways may staffing practices change in response to benefit cost controls?

A)Because benefits costs are fixed,the benefits cost per hour can be increased by having employees work more hours.
B)Organizations will try to have their employees classified as exempt whenever possible.
C)Growth in the number of full-time workers.
D)Rehiring of previously laid off employees.

Question 57

From which source do most retirees receive most of their retirement income?

A)CPP/QPP
B)Private pensions
C)Earnings from assets
D)Disability insurance

Question 58

__________ are part of an organization's total compensation package that include both mandatory government-sponsored benefits and voluntary benefits such as life and disability insurance,extended health coverage,additional vacation pay,and a range of other options.

A)Flexible Benefits Plan
B)Employment Compensation
C)Employee benefits
D)Extended Medical Coverage

Question 59

Which of the following is NOT an effort to manage care or cost containment?

A)Benefit opt out program
B)Plan design
C)External cost control systems
D)Claims review

Question 60

__________ provides employees the chance to choose (within limits)among benefits offered by the employer,to help ensure the plan will more effectively meet the needs of all employees and to help the employer contain costs.

A)Flexible Benefits Plan
B)Employment Compensation
C)Employee benefits
D)Extended Medical Coverage

Question 61

The major advantage of a flexible spending account is

A)that dependent care expenses are covered through the same account.
B)the increases in employees' take-home pay.
C)that unused funds are reverted back to the employee.
D)that the account covers unpredictable expenses.

Question 62

Which of the following is NOT a category of benefits programs?

A)CPP/QPP
B)Retirement
C)Pay for time not worked
D)Public group insurance

Question 63

Below are some of the obvious reason for offering benefits EXCEPT

A)group discounts
B)regulations
C)organizational commitments
D)minimizing compensation-related taxes

Question 64

In one Canadian government survey that included almost 14 million employees,50 percent were covered by three types of insurance: medical,life/disability,and

A)Travel
B)Rehabilitation
C)Psychological
D)Dental

Question 65

Which of the following statements about flexible spending accounts is NOT true?

A)They can only be used for dependent-care expenses
B)They permit pre-tax employee contributions
C)They are regulated under the federal tax code
D)Funds must be used by the plan's year end or they revert to the employer

Question 66

Which one of the following is NOT generally a characteristic of sick leave programs?

A)They are based on a "use it or lose it," no-accumulation policy.
B)They provide full salary replacement.
C)The amount of leave is often based on length of service.
D)They extend for a limited period of time,usually not exceeding 26 weeks.

Question 67

Over the years,which one of the following has NOT been an underlying reason for the growth in benefits?

A)The tax treatment of benefits programs is often more favourable for employees than the tax treatment of wages and salaries
B)The cost advantage that groups typically receive over individuals
C)The explosive growth in the number of small businesses within the United States and Canada
D)The growth of organized labour from the 1930s through the 1950s

Question 68

Which one of the following is true of defined contribution plans?

A)They shift the investment risk to the employer.
B)They present greater administrative challenges to employers.
C)They are a declining in popularity.
D)They are more prevalent in smaller than larger companies.

Question 69

Employers have no legal obligation to offer private retirement plans,but many do.If a private retirement plan is provided,it must be a

A)Non-registered Retirement Savings Plan
B)Registered Retirement Savings Plan
C)Non-registered Pension Plan
D)Registered Pension Plan

Question 70

The workers' compensation cost to an employer is based on all of the following except

A)the type of occupation.
B)the employer's profitability.
C)the state where work is located.
D)the employer's experience rating.

Question 71

Which of the following is NOT a vesting right?

A)The right to a pension at retirement for vested employees.
B)Vesting must take place under one of the two minimum vesting schedules.
C)The right to a pension regardless of whether the vested employee remains with the employer until retirement.
D)Employee contributions to their own plans are not vested.

Question 72

_____________ are retirement plans sponsored by employers that are registered according to the Income Tax Act and subject to Federal and Provincial pension standards legislation.

A)Non-registered Retirement Savings Plans
B)Registered Retirement Savings Plans
C)Non-registered Pension Plans
D)Registered Pension Plans

Question 73

The highest level of child care provision is

A)providing vouchers or discounts for employees to use at existing child care facilities.
B)providing child care at or near the worksite.
C)supplying information about the cost and quality of available child care.
D)referring employees to websites and phone numbers of child care facilities in the area.

Question 74

A company would like to provide benefit-related compliance information to all of its employees.Which of the following media should it use?

A)Meetings
B)Webcasts
C)Teleconference messaging
D)Summary plan descriptions

Question 75

Several factors affect the amount of income that will be available to an employee upon retirement.Identify the exception.

A)The age at which investments are made
B)Different historical rates of return for different investments
C)The need for diversification
D)The level of job performance

Question 76

Employers offering top-ups to employees often do so for

A)legal purposes
B)recruitment purposes
C)retention purposes
D)employee recognition purposes

Question 77

Perhaps the most important issue in benefits management is the challenge of providing quality medical benefits while

A)complying with legal requirements
B)controlling costs
C)satisfying the needs of the employees
D)satisfying the strategic objectives of the organization

Question 78

Adverse selection can be controlled by all but one of the following employer actions.Name the exception.

A)Restricting certain employees from selecting certain benefits options
B)Placing limitations on coverage amounts
C)Pricing certain benefits options higher
D)Providing a limited set of benefits package options

Question 79

Which of the following is NOT characteristic of employee wellness programs?

A)The programs are preventive in nature.
B)The programs manage health-care costs by reducing employees' needs for services.
C)The programs tend to be quite costly.
D)The programs target specific health risks.

Question 80

Which of the following is NOT a unique aspect of benefits as part of total compensation?

A)There is a question of legal compliance.
B)They have become institutionalized.
C)They are more liquid than wages and salaries.
D)They are more complex than other forms of compensation.