Question 1

Experience rating of the unemployment program has which of the following effects?

Accepted Answer

Experience rating charges employers higher rates when they have more layoffs, which often coincides with economic downturns when companies are least able to afford additional costs.

Question 2

The major change established by the passage of workers' compensation laws was to:

Accepted Answer

The passage of workers' compensation laws substituted the employer's liability without fault for the common law doctrine of negligence, meaning that employers were now responsible for compensating workers for job-related injuries regardless of whether the employer was at fault. This was a major change from the previous legal framework and shifted the burden of compensation from the employee to the employer.

Question 3

Which of the following is not an economic benefit to society of unemployment insurance?

Accepted Answer

Unemployment insurance does not provide employers a liability-free way to discharge employees without cause. In fact, it is designed to provide temporary financial assistance to employees who have lost their jobs through no fault of their own.

Question 4

Which one of the following is not a concern of the risk manager with respect to workers compensation?

Accepted Answer

The assumption of risk defense is not a concern of the risk manager with respect to workers compensation, as it is a legal defense that employers may use to deny liability for injuries that occur as a result of an employee's voluntary assumption of a known risk. The other options, health-related costs, cumulative injury problems, and the increasing frequency of litigation concerning compensation, are all concerns of the risk manager with respect to workers compensation.

Question 5

Which of the following was a common law defense used by employers prior to the enactment of workers' compensation laws?

Accepted Answer

Contributory negligence was a common law defense used by employers prior to the enactment of workers' compensation laws. It allowed employers to argue that the injury was partly the fault of the employee and therefore the employer should not be held liable for the full extent of the damages. This defense was often used to deny claims by injured workers. However, workers' compensation laws were enacted to provide compensation to workers regardless of fault, making contributory negligence an outdated defense.

Question 6

If a state collects unemployment taxes,then federal unemployment taxes are offset by up to:

Accepted Answer

If a state collects unemployment taxes, then the federal unemployment tax rate is reduced by up to 90%. This is known as the "credit reduction" provision, which allows states to receive a credit against their 6% federal unemployment tax rate for up to 5.4% of the state unemployment taxes paid. Therefore, the effective federal unemployment tax rate for employers in these states is only 0.6%.

Question 7

Choose the year closest to the enactment of unemployment insurance:

Accepted Answer

Unemployment insurance was enacted as part of the Social Security Act in 1935.

Question 8

Approximately how much was paid in unemployment benefits in a recent year?

Accepted Answer

According to the Bureau of Labor Statistics, about $41 billion in unemployment benefits were paid out in 2019.

Question 9

Worker's compensation covers all of the following losses except:

Accepted Answer

Worker's compensation only covers injuries and disabilities that occur as a result of job-related accidents or incidents. Any injuries sustained from accidents or incidents that occur outside of work are not covered by worker's compensation. Therefore, medical expenses resulting from an at-home accident would not be covered.

Question 10

Government control over the money supply using interest rates to effect changes in the economy is called:

Accepted Answer

Monetary policy involves government control over the money supply through actions like adjusting interest rates. Fiscal policy involves government decisions regarding taxation and spending. Transfer payments refer to government programs that provide assistance to individuals or groups in need, such as welfare or Social Security.

Question 11

Worker's compensation is likely to cover all the following except:

Accepted Answer

Workers' compensation typically does not cover 100 percent of lost wages during disability; it usually covers a portion of the employee's wages. Medical expenses, rehabilitation expenses, and reasonable funeral expenses are generally covered under workers' compensation.

Question 12

Each of the following describes a condition under which an employee is injured on the job. Under which of these would the employer not have to provide workers' compensation benefits to the injured employee?

Accepted Answer

If an employee is under the influence of alcohol or drugs, they may be found ineligible for workers' compensation benefits. In this case, the employee had several beers before work, which could have contributed to their injury, and the employer may not be required to provide compensation.

Question 13

Which of the following is not a purpose of workers' compensation laws?

Accepted Answer

Workers' compensation laws are designed to provide benefits and protection to employees who are injured or become ill as a result of their job. The purpose of these laws is to ensure that injured workers receive medical care and wage replacement benefits, as well as protection against employer retaliation. These laws do not exist to protect employers against business interruption risk, which is typically addressed through business interruption insurance.

Question 14

Which of the following is paid for under most workers' compensation systems?

Accepted Answer

Most workers' compensation systems cover injuries that occur in the course of employment, including those resulting from "horse play," as long as the activity is not excessively reckless or outside the scope of employment.

Question 15

Unemployment insurance is financed by a _______________on covered wages.

Accepted Answer

Unemployment insurance is financed by a 6.2% federal tax on covered wages up to $7,000. This tax is split evenly between employers and employees, with each contributing 3.1%. The funds collected are then used to provide benefits to qualifying individuals who have lost their jobs through no fault of their own.

Question 16

Which of the following is false concerning unemployment insurance?

Accepted Answer

Unemployment insurance is typically funded by employer contributions through payroll taxes, not by both employees and employers.

Question 17

Unemployment benefits are usually available in which of the following situations?

Accepted Answer

Unemployment benefits are typically available to workers who have been laid off due to no fault of their own, such as in the case of an employer going bankrupt. Workers who voluntarily quit or are fired for misconduct, such as theft, normally do not qualify for unemployment benefits. Workers who participate in a strike may also be ineligible for unemployment benefits, depending on the laws in their state and the nature of the strike.

Question 18

The exclusive remedy of worker's compensation law states that the:

Accepted Answer

The exclusive remedy of worker's compensation law means that the employee can only collect compensation from the worker's compensation system for work-related injuries. This prevents the employee from suing their employer in the tort system for damages beyond what is provided by worker's compensation. It also protects the employer from potentially costly lawsuits and ensures that injured employees receive prompt medical treatment and wage replacement benefits.

Question 19

Which of the following do not influence a workers' eligibility for,and amount of,unemployment benefits?

Accepted Answer

The type of work performed does not typically affect a worker's eligibility for unemployment benefits or the amount received. The other options, waiting period, earnings record, and continuing interest in employment, can all affect a worker's eligibility and amount of benefits.

Question 20

Which of the following is not a requirement for receiving unemployment benefits?

Accepted Answer

The national unemployment percentage exceeding a certain level is not a requirement for receiving unemployment benefits. The other options listed are requirements for receiving benefits.

Quiz 23: Unemployment and Workers Compensation Insurance