Question 1

A job title is not a sufficient basis for exemption from the overtime provisions of the FLSA.

Accepted Answer

The FLSA uses job duties and salary level as the basis for determining whether an employee is exempt from overtime provisions, not just their job title alone.

Question 2

Surface bargaining is a process of bargaining during which management meets with representatives of all the bargaining units at one time to discuss difficult economic issues.

Accepted Answer

Surface bargaining refers to a bad faith negotiation tactic where one party goes through the motions of bargaining without any real intention to reach an agreement, not to meetings with multiple bargaining units.

Question 3

If an employee is paid $455 per week and his/her primary duty is management of the organization, then the employee will be exempt from overtime provisions of the FLSA.

Accepted Answer

The Fair Labor Standards Act (FLSA) sets the minimum wage and overtime requirements for most employees in the United States. The FLSA provides an exemption from overtime for employees whose primary duty is management of the organization, and who are paid on a salary basis of not less than $455 per week. Therefore, if an employee meets these requirements, they will be exempt from overtime provisions of the FLSA.

Question 4

Contract costs for retiree benefits increases in retirement and health care provided in earlier contracts are known as legacy costs.

Accepted Answer

Legacy costs refer to the costs associated with retiree benefits and previous health care agreements that increase as employees retire, creating a financial burden for employers.

Question 5

According to the value-added concept, wages paid to the employees should be equal to their contribution of labor to the final product.

Accepted Answer

The value-added concept states that wages paid to employees should be proportional to the value they add to the final product through their labor input. This means that if an employee contributes more to the product's value, they should receive a higher wage. Therefore, the value-added concept supports the idea that wages should be equal to the contribution of labor.

Question 6

Job evaluation is a systematic method of determining the worth of a job to an organization.

Accepted Answer

Job evaluation involves assessing the value of a job in terms of its responsibilities, required skills and qualifications, and the level of complexity involved. It helps organizations to establish a fair and consistent pay structure and ensure that employees are compensated fairly for the work they perform.

Question 7

A collective bargaining provision, effective for the term of the contract, which provides for contract talks to be reopened only for the renegotiation of wage rates, is known as a severability provision.

Accepted Answer

A severability provision is a clause in a contract stating that if any portion of the contract is found to be invalid or unenforceable, the remaining provisions of the contract will remain in effect. It does not relate to the renegotiation of wage rates.

Question 8

The "pyramiding" of overtime pay is accepted in most of the contract agreements.

Accepted Answer

Pyramiding of overtime pay generally refers to the practice of calculating overtime on both daily and weekly totals, leading to potentially excessive overtime charges. Most contract agreements do not accept this practice as it can lead to inflated labor costs. Instead, they typically specify a single method for calculating overtime to avoid double counting hours worked.

Question 9

The amendments to the Fair Labor Standards Act provide for a training wage for employees less than 20 years of age set at 85 percent of the minimum wage.

Accepted Answer

The amendments to the Fair Labor Standards Act do provide for a training wage for employees less than 20 years of age set at 85 percent of the minimum wage.

Question 10

A three-year total wage increase package that provides 8 percent wage increase in the first year, 5 percent in the second year, and 2 percent in the third year is known as a back-end contract.

Accepted Answer

A back-end contract typically refers to a wage increase package that provides lower wage increases in the first year and higher increases in subsequent years, whereas this scenario describes a front-end contract.

Question 11

Employees earning over $100,000 per year do not receive overtime if their duties are executive, administrative, or professional.

Accepted Answer

According to the Fair Labor Standards Act (FLSA), employees earning more than $100,000 per year and performing executive, administrative, or professional duties are exempt from receiving overtime pay.

Question 12

The Davis-Bacon Act of 1931 regulates employers who hold federal government contracts of $2,000 or more for federal construction projects. It provides that employees working on these projects must be paid the prevailing wage (PW) rate.

Accepted Answer

The Davis-Bacon Act of 1931 requires federal contractors to pay their workers the prevailing wage rate on federal construction projects.

Question 13

COLAs are considered to be necessary because the real wage is eroded by inflation.

Accepted Answer

COLAs (Cost-of-Living Adjustments) are given to compensate for the increase in the cost of living due to inflation. Inflation can erode the purchasing power of a worker's wage over time, and therefore, COLAs are necessary to ensure that the real wage does not decrease.

Question 14

A piece-rate system is a wage system that pays newly hired workers less than current employees performing the same or similar jobs.

Accepted Answer

A piece-rate system pays workers based on the quantity of work they have completed rather than the number of hours worked. It does not typically differentiate between newly hired workers and current employees performing the same or similar jobs.

Question 15

A two-tier wage system is a wage system in which the wages received by the employees are directly proportional to their performance.

Accepted Answer

A two-tier wage system is actually a wage system in which employees doing the same work receive different rates of pay based on their date of hire or other factors, creating a tiered system of compensation. It is not directly related to their performance.

Question 16

According to productivity theory, employees should share in increased profits gained by the greater productivity achieved because of their efforts.

Accepted Answer

Productivity theory advocates for a fair distribution of profits, wherein employees should receive a share of increased profits resulting from their enhanced productivity.

Question 17

The FLSA stipulates that employees must receive overtime pay of one and a half times the normal rate when they work over 30 hours per week.

Accepted Answer

The FLSA stipulates that employees must receive overtime pay of one and a half times the normal rate when they work over 40 hours per week, not 30 hours per week.

Question 18

A back-loaded contract provides a lower wage adjustment in the first year with higher increases in later years of a multiyear contract.

Accepted Answer

A back-loaded contract defers a larger portion of the salary increase until later years, resulting in a smaller increase in the initial year of the contract.

Question 19

The variable wage formula provision is most commonly found in the private sector.

Accepted Answer

The variable wage formula provision is more commonly associated with public sector employment, where wages may be adjusted based on government budgets, economic conditions, or performance metrics, rather than the private sector, which often uses different compensation strategies.

Question 20

Union negotiators often prefer back-loaded contracts so that their members receive additional wages and realize a large increase in pay in the first year itself.

Accepted Answer

Union negotiators often prefer front-loaded contracts, meaning that their members receive immediate increases in pay in the first year, rather than back-loaded contracts where the increases are deferred to later years in the contract. This helps to address economic pressures and inflation, and provides immediate relief to union members.

Quiz 7: Wage and Salary Issues