Which of the following statements about earnings-at-risk pay plans is true?
A) Earnings-at-risk plans involve upside risk for the employer.
B) Earnings-at-risk plans set base pay at or above the market rate.
C) Salespeople who work on straight commissions are paid through at earnings-at-risk plan.
D) Earnings-at-risk plans all have caps that prevent the employer from having to pay above a certain predetermined level.
E) Employees prefer earnings-at-risk plans to all other performance-based pay plans

Question

Quizplus · Accepted Answer

Earnings-at-risk plans, such as those involving straight commissions, mean that the employee's earnings are directly tied to their performance. If they do not perform, they do not earn, placing their earnings at risk.

Which of the Following Statements About Earnings-At-Risk Pay Plans Is