Deck 7: Economic Issues

Question 1

Most unions consider gain sharing plans as an adequate substitute for traditional negotiated hourly wage gains.

Answer 1

False

Question 2

If a union wishes to encourage solidarity within its membership at a particular firm, it should negotiate for a two-tier pay plan.

Answer 2

False

Question 3

The monetary value of employee benefits provided by unionized employers exceeds the value of employee benefits provided by nonunion employers.

Answer 3

True

Question 4

The majority of union contracts include a pension plan that can best be described as a defined contribution plan.

Question 5

The majority of private sector union contracts contain a cost-of-living adjustment (COLA) clause.

Question 6

A higher degree of labor intensiveness increases management negotiators' resistance to bargaining proposals designed to increase wage rates.

Question 7

The term "value added" refers to the contribution of factors of production to the value of a final product or service.

Question 8

A Scanlon plan, Rucker plan, and Improshare plan are all examples of gain sharing plans.

Question 9

Supplemental unemployment benefits (SUB) are payments made by the federal government to unemployed workers during a layoff.

Question 10

Union leaders favor job evaluation more than managers for use in designing the wage structure.

Question 11

Unions generally favor the use of an employee stock ownership plan (ESOP) as a basic pension plan for employees.

Question 12

Skill-based pay sets the wage rate according to a job's title (type).

Question 13

Labor market wage surveys are used to ensure that a firm's wage structure is externally equitable.

Question 14

Union leaders often view job evaluation with disfavor because it tends to limit bargaining opportunities and freeze wage structure.

Question 15

Wage comparability is a fairly easy concept to apply to set wage rates for different jobs.

Question 16

The global economy of today has made it easier for employers to pass labor cost increases on to consumers by raising product or service prices.

Question 17

The majority of private sector union contracts contain a two-tier pay plan.

Question 18

Wages and other economic benefits represent income to employees, costs to an employer, and a basis for tax revenue to the government.

Question 19

Most labor agreements specify daily or weekly work schedules and most provide premium pay for hours worked beyond the normal hours.

Question 20

The majority of private sector employees participate in a profit sharing plan.

Question 21

The average number of paid holidays provided under union contracts was ___, although 40 percent of bargaining unit members receive 11 or more.

A) 6
B) 8
C) 10
D) 12
E) 13

Question 22

In 2006, ___ percent of private-sector union members participated in some type of employer- or union-sponsored pension plan compared to 57 percent of nonunion employees.

A) 28
B) 33
C) 56
D) 84
E) 93

Question 23

In a _________, firms make monetary payments to a specific group or groups of employees for producing more output or generating cost savings beyond some established goal.

A) profit sharing plan
B) gain-sharing plan
C) fee-for-service plan
D) graded vesting schedule
E) all of these

Question 24

The labor relations term for a one-time payment made to adjust wages which does not affect an employee's hourly base wage rate is:

A) Wage re-opener.
B) Holiday pay.
C) Vacation pay.
D) Lump sum pay adjustment.
E) Spillover effect.

Question 25

A widely recognized group incentive plan based on labor cost savings is the:

A) Profit sharing plan.
B) Merit savings plan.
C) Piece rate plan.
D) Scanlon plan.
E) Premium pay plan.

Question 26

Federal legislation has been enacted to protect workers against wage discrimination (e.g., Equal Pay Act of 1963, Civil Rights Acts of 1964and 1991, and the Age Discrimination in Employment Act of 1967). These laws prohibit paying male employees more than female employees unless the wage difference is justified on the basis of:

A) skill, effort, responsibility.
B) seniority.
C) performance.
D) working conditions
E) all of these

Question 27

Approximately what percentage of union contracts contain a temporary two-tier wage agreement?

A) less than 5%
B) 21%
C) 25%
D) 34%
E) 52%

Question 28

All of the following are group incentive plans except:

A) Scanlon plan.
B) Improshare.
C) Piece rate plan.
D) Rucker plan.
E) All of these are group incentive plans

Question 29

The labor relations term for a written clause in a labor agreement that adjusts wages periodically in accordance with some predetermined formula tied to the rise in consumer prices is:

A) Wage re-opener.
B) Cost-of-living adjustment.
C) Lump sum pay adjectments.
D) Wage spread.
E) Spillover effect.

Question 30

Which federal agency is responsible for computing and reporting the Consumer Price Index (CPI)?

A) Department of Commerce
B) Department of Agriculture
C) Department of State
D) Department of Labor
E) Department of National Statistics

Question 31

Lump sum pay adjustments appeared in ____ percent of labor contracts in 2007.

A) 10 %
B) 15%
C) 20%
D) 25%
E) more than 30%

Question 32

The relative influence of job evaluation can be seen in the ___________, which represents the internal distribution of the proposed or negotiated wages.

A) skill pay differential
B) skill-based pay
C) wage spread
D) management's ability to pay
E) skill-based pay and wage spread

Question 33

The Family and Medical Leave Act of 1993 provide eligible employees up to ____ weeks of unpaid leave for a serious illness, birth or adoption of a child, or care of a seriously ill child, spouse, or parent.

A) 2
B) 4
C) 6
D) 8
E) 12

Question 34

The labor relations term for a written clause in a labor agreement which permits the parties to negotiate wage rates at some predetermined date during the life of the agreement is:

A) Cost-of-living adjustment.
B) Lump sum pay adjustments.
C) Wage re-opener.
D) Open-ended contract.
E) Spillover effect.

Question 35

The federal agency responsible for enforcement of the Family and Medical Leave Act is:

A) Equal Employment Opportunity Commission.
B) Family and Medical Leave Administration.
C) Department of Labor.
D) Federal Standards Board.
E) National Labor Relations Board.

Question 36

The most common formula for adjusting wages to the cost of living is:

A) a percentage increase in wages for each percentage increase in the CPI.
B) wages increased 3 cents for each 0.1 rise in the CPI.
C) wages increased 1 cent for each 0.3 rise in the CPI.
D) wages increased 1 cent for each 0.2 rise in the CPI.
E) none of these

Question 37

The Family and Medical Leave Act of 1993 covers private sector employers with:

A) 25 or more employees.
B) 50 or more employees.
C) 100 or more employees.
D) 500 or more employees.
E) 1,000 or more employees.

Question 38

Which one of the following represents a process for systematically securing information and facts about a job to be evaluated?

A) Job description
B) Job evaluation
C) Job analysis
D) Job survey
E) Job specifications

Question 39

Under a cliff vesting schedule, an employee is considered fully vested after completing ____ years of service.

A) 3
B) 6
C) 10
D) 15
E) 30

Question 40

Which of the following preliminary conclusions can be reported based on a research on the effects of ESOPs?

A) employees identify more with the company and have greater information about its operation
B) employees' attitudes about motivation, absenteeism, and job satisfaction are automatically affected
C) the actual role of the union changes after the ESOP
D) the firm will become more productive, efficient, and profitable
E) employees want to take over companies with ESOPs