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36 Cards in this Set
- Front
- Back
Qualified domestic relations orders (QDRO)
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Legal orders issued by state courts or other state agencies to require pension payments to alternate payees. An alternate payee must be a spouse, former spouse, child, or other dependent of a plan participant.
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Qualified plan
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Meets ERISA requirements and provides tax advantages for both employees and employers. It can't provide additional benefits for officers, shareholders, executives, supervisors, or other highly compensated employees—all employees in the organization must be eligible for all plan benefits.
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Ranking method
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Requires evaluators to compare the value of jobs to one another. It is a subjective method for evaluating jobs
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Red circle
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Pay falls above the maximum of the salary range
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Reduced FMLAleave schedule
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A leave in which the employee’s regular work schedule is reduced for a period of time. This can mean a reduction in the hours worked each day or in the number of days worked during the week.
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Reporting premium
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When employees arrive at work for their regularly scheduled shift but there is no work to be done, they may be paid for a minimum number of hours based on employment agreements or state laws. Reporting pay is not required by the FLSA.
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Restricted stock
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Common stock offered to employees, typically executives or employees who demonstrate outstanding performance. Restricted stocks are actual shares, not the option to buy shares, like stock options. Usually follows a vesting schedule designed to reward retention.
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Retirement Equity Act (REA)
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Lowered age limits for participation and vesting in pension plans. It also required written approval from a spouse if the participant did not want to provide survivor benefits in the plan and placed restrictions on the conditions that could be placed on survivor benefits. (1984)
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Salary surveys
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Allow organizations to gather compensation and benefits data that reflects current trends in the labor market.
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Scanlon plan
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One of the earliest pay for performance plans. Created to increase productivity and decrease costs through employee involvement. Employees receive a portion of cost savings achieved through productivity gains and cost savings.
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Section 125 plans AKA FSA
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Allows employees to set aside pretax funds for medical expenses they plan to incur during the calendar year. Funds left in the account after all expenses for the year have been paid will be forfeited and may be used by the employer to pay the administrative costs of the plan
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Self-funded plan
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A plan in which the employer creates a claim fund and pays all claims through it.
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Seniority-based compensation
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Making pay decisions based on the length of time employees have been in a position and on years of related experience. Representative of an entitlement compensation philosophy.
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Service contract act
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Requires any federal service contractor with a contract exceeding $2,500 to pay its employees the prevailing wage and fringe benefits for the geographic area in which it operates, provide safe and sanitary working conditions, and notify employees of the minimum allowable wage for each job classification, as well as the equivalent federal employer classification and wage rate for similar jobs. (1965)
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Shift
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Any scheduled block of time during the work week when employees perform job-related duties.
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Shift premium
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Additional compensation provided for employee who work other than the day shift. May be paid as a percentage of base pay or may be factored into the hourly rate
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Small Business Job Protection Act
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To relieve the costs of administering qualified plans for small businesses, this act simplified ADP tests for 401(k) plans and redefined highly compensated employees. In addition, it detailed minimum participation requirements and made changes to disclosure requirements for qualified plans. (1996)
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State unemployment insurance (SUI)
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Localized responsibility for the administration and distribution of this program was established by the SSA act of 1935. This program can have varying rates and based on location and employer.
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Stock option
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The right to purchase an employer’s stock at a certain price (the strike-price), at a future date, within a specified period of time.
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Stop-loss insurance
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Stop-loss insurance is purchased by sell-funded employers to prevent a single catastrophic claim from devastating the claim fund. The employer agrees upon a preset maximum coverage amount that will be paid from the claim fund for each participant before the insurance company begins to pay the claim.
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Strike price
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Also known as the grant price, the strike price is the price at which stock options may be purchased or sold by the holder of the options when they are exercised.
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Summary plan description (SPD)
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Provides plan participants with information about the provisions, policies, and rules established by the plan and advises them on actions they can take in utilizing the plan.
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Swing shift
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Shift work hours from 4 p.m. to 12 a.m.
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Target benefit plan
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Instead of using a fixed percentage of employee salaries to determine annual contribution amounts, actuarial formulas calculate the contribution amount needed to reach a predetermined benefit amount at retirement. This amount rakes into consideration the current age of each employee, so different amounts will be contributed for employees with equal compensation packages.
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The Mental Health Parity Act
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Requires insurers to provide the same limits for mental health benefits in their plans as they provide for other health benefits. (1996)
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Third-party administrator (TPA)
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An organization that processes insurance claims or certain aspects of employee benefit plans for a separate entity
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Time-and-a-half
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Time-and-a-half is the overtime rate specified by the FLSA for non-exempt employees who work more than 40 hours per week.
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Total rewards philosophy
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a high-level mission statement used to guide the development and implementation of compensation and benefit programs that attract, motivate, and retain employees.
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Total rewards strategy
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used to determine how the resources available for rewards programs can he used to best advantage in attracting, motivating, and retaining employees
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Unemployment Compensation Amendments
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This act reduced rules for rolling over lump-sum distributions of qualified retirement plans into other plans and subjected some distributions to 20 percent Income tax withholding. (1992)
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Variable compensation
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Programs that reward employees for individual and/or organizational results. Also known as "Pay for performance" and "Incentive pay"
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Vesting
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The point at which employees own the contributions their employer has made to the pension plan whether or not they remain employed with the company.
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Wage compression
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Occurs when new employees are hired at a rate of pay greater than that earned by incumbent employees for similar skills, education, and experience.
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Wage garnishments
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Funds employers may be required by a court order or tax levy to withhold from employee paychecks. Issued to satisfy a debt owed by the employee.
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Waiting to be engaged
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Example: waiting for work to start - non-compensable
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Walsh Healy public contracts act
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Requires government contractors with contracts exceeding $10,000 (for other than construction work) to pay their employees the prevailing wage for their local area as established by the secretary of labor. (1936)
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