Question 1

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

Accepted Answer

The experience rating of the unemployment program charges employers more when the economy is weak, thus creating a burden on companies when they can least afford it. This can encourage companies to engage in short-term layoffs and create an unstable workforce, leading to a negative impact on both employers and employees. Penalizing good employers that never fire employees would not be fair, and providing funds to continue employment instead of dismissing employees is not necessarily linked to experience rating of the unemployment program.

Question 2

Workers' compensation covers all of the following losses except:

Accepted Answer

Workers' compensation only covers losses that result from job-related injuries or illnesses. Medical expenses resulting from an at-home accident would not be covered.

Question 3

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 meant that if an employee was even slightly at fault for their own injury, they would not be able to recover any compensation from the employer. This defense was often used to deny compensation to injured workers, making it difficult for them to seek and receive damages.

Question 4

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

Accepted Answer

Unemployment benefits are usually available to workers who are laid off due to no fault of their own, such as in the case of an employer becoming bankrupt. Workers who quit voluntarily, are fired for misconduct (such as theft), or are participating in a strike are generally not eligible for unemployment benefits.

Question 5

Which of the following does not influence a worker's eligibility for, and amount of, unemployment benefits?

Accepted Answer

The type of work performed does not have an impact on a worker's eligibility for unemployment benefits. However, the waiting period, earnings record, and continuing interest in employment are all factors that are considered in determining eligibility and the amount of benefits.

Question 6

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 all commonly required for eligibility.

Question 7

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

Accepted Answer

Providing employers a liability-free way to discharge employees without cause is not an economic benefit to society of unemployment insurance. In fact, it may lead to increased unemployment and instability in the workforce. The other options listed (B, C, and D) are all economic benefits of unemployment insurance.

Question 8

The exclusive remedy of workers' compensation law states that the:

Accepted Answer

The exclusive remedy of workers' compensation law ensures that employees can only collect benefits from the workers' compensation system for work-related injuries or illnesses. This means that they cannot sue their employer for negligence or other liability claims related to the injury. In return for this limitation, employees receive a streamlined process for receiving benefits, regardless of fault or negligence, without having to go through the regular court system.

Question 9

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 drugs or alcohol at the time of the injury, the employer may not be liable for workers' compensation benefits. In this case, the employee had several beers before work, which could potentially be the cause of the injury, making the employer not responsible for compensation benefits.

Question 10

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

Accepted Answer

The purpose of workers' compensation laws is to provide benefits to injured employees, including medical care and lost earnings. The laws also protect employers by limiting their liability and providing a system for managing workplace injuries. However, workers' compensation laws do not protect employers against business interruption risk, which is a different type of insurance coverage.

Question 11

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

Accepted Answer

Federal unemployment taxes are offset by up to 90% if a state collects unemployment taxes. This means that the federal government takes into account the taxes already paid by the state when calculating the employer's federal unemployment tax liability. Therefore, the employer would only be responsible for paying the remaining 10% of the federal unemployment taxes, if any.

Question 12

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 a concern for workers' compensation attorneys, not risk managers. Risk managers are more concerned with health-related costs, cumulative injury problems, and increasing litigation concerning compensation, as they are responsible for managing the overall risk exposure of the organization.

Question 13

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

Accepted Answer

Injuries occurring from "horse-play" on the job are often covered under most workers' compensation systems, as they are considered to have occurred in the course of employment, despite being the result of non-serious behavior.

Question 14

Choose the year closest to the enactment of unemployment insurance:

Accepted Answer

Unemployment insurance was enacted in 1935 through the Social Security Act, making option B (1935) the closest year to the enactment. Option A (1929) is not a correct choice, as it was the beginning of the Great Depression and unemployment insurance had not yet been introduced. Options C (1946) and D (1955) both fall after the enactment of unemployment insurance and are therefore not the closest year.

Question 15

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. This means that employees could receive compensation for work-related injuries without having to prove that their employer was negligent, making it easier for them to receive compensation. Workers' compensation laws also provided an alternative to lengthy and expensive legal battles, which would have favored the defense.

Question 16

Unemployment insurance is financed by a ________ on covered wages.

Accepted Answer

Unemployment insurance in the United States is primarily financed by a 6% federal tax on employers on the first $7,000 of wages paid to each employee.

Question 17

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

Accepted Answer

Government control over the money supply using interest rates to effect changes in the economy is called monetary policy. Fiscal policy refers to government spending and taxation, tax policy refers specifically to government taxation policies, and transfer payments refer to government payments to individuals or groups without any expected goods or services in return.

Question 18

What is the federal covered maximum wage for unemployment insurance taxation?

Accepted Answer

The federal covered maximum wage for unemployment insurance taxation is $7,000. This means that any wages earned above $7,000 per year are not subject to unemployment insurance taxes. Therefore, option B is the correct choice.

Question 19

Workers' 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 20

Which of the following is false concerning unemployment insurance?

Accepted Answer

Unemployment insurance is primarily funded by employers, not by both employees and employers. The tax that funds unemployment insurance is typically paid by the employer based on the amount of wages paid to employees, and it is experience-rated, meaning the tax rate can vary based on the employer's history of claims.

Quiz 21: Unemployment and Workers Compensation Insurance