Comp And Benefits (Ch 6) - Part 1 Of 4

Front 1

401(k) plan

Back 1

Allows for contributions from both employees and employers. Employees may defer part of their pay before taxes up to limits established by the EGTRRA. Employers may make contributions as well.

Front 2

Ability to pay

Back 2

The company affordability factor. It defines desired financial metrics that must be achieved before incentives are paid

Front 3

Actual deferral percentage (ADP) test

Back 3

Ensures that 401(k) plans are within limits set by IRS Regulations.

Front 4

Administrative services only (ASO) plan

Back 4

A plan were a Self-funded organizations may decide to contract with an insurance company to manage and pay claims.

Front 5

Base pay

Back 5

The amount of compensation that the employer and the employee agree will he paid for the performance of particular job duties

Front 6

Benchmark positions

Back 6

Jobs common to organizations regardless of size or industry, such as accountants or administrative assistants

Front 7

Bonus plan

Back 7

Additional compensation tor performance above and beyond expectations and is paid in addition to an employee’s base salary or hourly rate.

Front 8

Broad-banding

Back 8

Splits positions in the company into just a few specific pay ranges. Each range includes a variety of jobs.

Front 9

Call-back pay

Back 9

Pay to employees who are called to work before or after their scheduled hours

Front 10

Cash balance plans

Back 10

Benefits are determined by using a hypothetical personal pension account (PPA); each month this account is increased by a set rate - for example, 5 percent of the employee’s salary. The account also accumulates interest, typically related to the interest rate on Treasury bills.

Front 11

Classification method

Back 11

Positions with similar characteristics are slotted into the same grade or level, which are identified by a similar level of knowledge, skills, and abilities.

Front 12

Cliff vesting

Back 12

participants become 100 percent vested after a specified period of time. ERISA sets the maximum period at five years for qualified plans, which means that participants vest nothing until they have completed the five years of service, after which they are fully vested

Front 13

Commissions

Back 13

Provide incentives to sales employees by paying them a percentage of the sale price for products and services sold to a customer

Front 14

Comp time

Back 14

An arrangement by which eligible employees are entitled to time off in lieu of overtime pay.

Front 15

Comparable worth

Back 15

Comparable worth is a concept that suggests that jobs requiring similar levels of knowledge, skill, and ability should he paid similarly.

Front 16

Compa-ratio

Back 16

A simple calculation that compares an employee’s base pay to the midpoint of the pay range

Front 17

Compensable factors

Back 17

Characteristics that define and distinguish jobs from one another

Front 18

Compensable time

Back 18

The time an employee works that is "suffered or permitted” by the employer

Front 19

Competency-based compensation

Back 19

Focuses on employee KSAs, tying individual pay to increased ability

Front 20

Continuous FMLA leave

Back 20

A leave in which the employee is absent from work for an extended period of time

Front 21

Cost of labor

Back 21

The cost to attract and retain individuals with the skills needed by the organization to achieve its goals

Front 22

Covered entities

Back 22

Examples: health plans, health-care providers, and clearinghouses

Front 23

Davis bacon act

Back 23

The first federal legislation to regulate minimum wages. (1931)

Front 24

Defined benefit

Back 24

A traditional pension plan in which the employer provides a specific benefit upon retirement. The funds in these plans are not accounted for individually

Front 25

Defined contribution

Back 25

An individual plan in which the amount of funds contributed is known, but the amount of the benefit that is eventually paid out is not known because it depends on the investment returns that are earned. The funds are accounted for in individual accounts for each participant.

Front 26

Delayed vesting

Back 26

When participants must wait for a defined period of time prior to becoming fully vested

Front 27

Dependent care account

Back 27

Employees may set aside a maximum of $5,000 to he used to care for dependent children or elders

Front 28

Direct compensation

Back 28

Includes payment made to the employees that are associated with wages and salaries. Includes base pay, variable compensation and pay for performance

Front 29

Discretionary contributions

Back 29

Also known as profit-sharing programs, discretionary contributions allow employers to contribute deferred compensation based on a percentage of company earnings each year.

Front 30

Disposable earnings

Back 30

What is left in an employee’s paycheck after all legally mandated deductions have been made, such as federal and state income tax, Social Security, state and local taxes, disability insurance, and so on.

Front 31

Distributive justice

Back 31

How closely pay reflects actual performance

Front 32

Economic Growth and Tax Relief Reconciliation Act (EGTRRA)

Back 32

This act made a number of changes to contribution limits, increasing many and allowing for catch up contributions for employees older than 50 years of age. The act provided a schedule of changes through the end of the year 2010, which were extended by Congress in the Pension Protection Act of 2006 (2001)

Front 33

Employee assistance program (EAP)

Back 33

A low-cost benefit that provides a resource for employees with problems that are not work related and cannot be solved within the work context.

Front 34

Employee Retirement Income Security Act

Back 34

Created by Congress to set standards for private pensions and some group welfare programs such as medical and life insurance. Requires organizations to file three types of reports: a summary plan description, an annual report, and reports to individual participants of their benefit rights. (1974)

Front 35

Engaged to wait

Back 35

Being asked to wait for an assignment - compensable

Front 36

Enrolled actuary

Back 36

An enrolled actuary is licensed jointly by the department of the Treasury and the Department of Labor to analyze insurance and annuity premiums for U.S. pension plans.

Front 37

Enterprise coverage

Back 37

Applies to businesses employing at least two employees with at least $500,000 in annual sales and to hospitals, schools, and government agencies

Front 38

Entitlement philosophy

Back 38

Rewards seniority or employee longevity.

Front 39

Equal pay act (epa)

Back 39

The first antidiscrimination act to protect women, prohibits discrimination on the basis of sex. Applies to employers and employees covered by flsa and is administered and enforced by the equal employment opportunity commission (eeoc). (1963)

Front 40

Exception reporting

Back 40

Employees records only changes to the regular work schedule, such as vacation, sick, or personal time

Front 41

Excess Deferral Plan

Back 41

Allows the organization to make contributions to a nonqualified plan in order to reduce the impact of discrimination testing on highly compensated employees. This is done by making up the difference between what the executive could have contributed to the plan and what was actually allowed because of limits required by the qualified plan.

Front 42

Exempt

Back 42

Employees exempt from flsa regulations, must past a duties test, a salary level test and a salary basis test.

Front 43

Experience rating

Back 43

Medical care costs are analyzed by type, and premiums for the following period are adjusted based on THIS. Some organizations have implemented wellness programs to improve the THIS and lower premiums. In managed care settings, providers often determine premiums based on the costs incurred by the group during the current coverage period.

Front 44

Extrinsic reward

Back 44

A reward in which esteem is achieved from others, such as fulfillment from working with a talented team of peers.