Table of Contents
Title Page
Copyright Page
About the Author
About Human Resource Certification
Who Certifies HR Professionals?
The Human Resource Certification Institute
The Society for Human Resource Management
Professional Examination Service
Why Become Certified?
How to Become Certified
How This Book Is Organized
The Elements of a Study Guide
What’s on the CD?
The Sybex Test Preparation Software
Electronic Flashcards for PC and Palm Devices
PHR/SPHR Study Guide in PDF
How to Use This Book and CD
Assessment Test
Answers to Assessment Test
Chapter 1 - Certifying Human Resource Professionals
The Human Resource Profession
Development of the Human Resource Body of Knowledge
The Test
Chapter 2 - Core Knowledge Requirements for HR Professionals
Needs Assessment and Analysis
Third-Party Contract Management
Communication Skills and Strategies
Documentation Requirements
Adult Learning Processes
Motivation Concepts
Training Techniques
Leadership Concepts
Project Management Concepts
Diversity Concepts
Human Relations Concepts
HR Ethics and Professional Standards
Human Resource Technology
Qualitative and Quantitative Analysis
Change Management
Job Analysis and Description
Employee Records Management
Interrelationships Among HR Activities
Organizational Structures
Environmental Scanning Concepts
Employee Attitude Assessment
Basic Budgeting and Accounting
Risk Management
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 3 - Strategic Management
Strategic Management
Legislative and Regulatory Processes
Corporate Governance
HR Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 4 - Workforce Planning and Employment
Federal Employment Legislation
Strategic Workforce Planning
Staffing Programs
Organization Exit Processes
Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 5 - Human Resource Development
Federal Employment Legislation
Organization Development
Talent Management
Employee Training Programs
Performance Management Programs
Performance Appraisal
Unique Employee Needs
Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 6 - Total Rewards
Total Rewards Defined
Communicating TR Programs
Executive Compensation
Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 7 - Employee and Labor Relations
Federal Employment Legislation
Employee Relations
Dispute Resolution
Labor Relations
Union Organization
Union Avoidance Strategies
Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Chapter 8 - Risk Management
Risk Identification
Risk Assessment
Risk Management
Metrics: Measuring Results
Global Considerations
Exam Essentials
Key Terms
Review Questions
Answers to Review Questions
Appendix A - About the Companion CD
Appendix B - Case Study
Appendix C - Federal Employment Legislation and Case Law
Appendix D - Resources
PHR/SPHR: Professional in Human Resources Certification® Study Guide, Third Edition


Dear Reader,
Thank you for choosing PHR/SPHR: Professional in Human Resources Certification Study Guide, Third Edition. This book is part of a family of premium-quality Sybex books, all of which are written by outstanding authors who combine practical experience with a gift for teaching.
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Best regards,
Neil Edde
Vice President and Publisher
Sybex, an Imprint of Wiley

For Kit, who taught me to love reading; to Bob, the best manager of people I’ve ever known; and to both of them for their unwavering support and love.
—With love and gratitude

Writing a book is one of those romantic dreams that many people have, although usually it’s to write the great American novel or the next big blockbuster thriller and not a study guide, no matter how passionate the author is about the subject matter. I have learned that it is a lot harder to write a book than one would think, and the team at Wiley provided the encouragement and support that got me through the process. Working with this fantastic group of people gets better every time. Thanks to Jeff Kellum for arranging everything and getting the process going, thanks to David Clark for helping shape the book and for his patience, and thanks to Rachel McConlogue for making sure the final product was the best it could be. Thanks to all of you for your thoughtful comments and suggestions—I have enjoyed working with all the teams in the past, but, without doubt, you have made this the best experience to date. Thanks also to Kim Wimpsett, whose attention to detail was immensely helpful, and to Craig Woods and the group at Happenstance Type-O-Rama, who made the pages of this book so accessible. I am grateful for the level of professionalism and expertise that each of them brought to this project.
I am most grateful to the book’s technical editor, Laura Owen, JD, SPHR, GPHR, whose expertise and feedback were invaluable in clarifying my thoughts and improving the content. I am also indebted to Tamra Aguinaldo, PHR, whose experience in HR certification and professional development added greatly to the final product. Thanks to the students in my certification classes, especially those who put me on the spot by asking questions that I didn’t know the answers to—I learned so much from all of you! Special thanks to Gayle Holmlund, SPHR, for her encouragement and support.
Special thanks to Debbie, Judy, Jeannette, KC, and Barb for encouraging me when it all seemed like too much to “get ’er done.” To my clients, from whom I learn more every day, thank you. Finally, thanks to my friends for their generosity of spirit, understanding, and patience while I finished this project—all of you are the best!

About the Author
Anne M. Bogardus, SPHR began her human resources career in compensation at a public multinational corporation, Castle & Cooke, owner of the Dole food brand, and later at First Nationwide Bank. Currently she is founder and principal of S.T.A.R. HR in northern California, which specializes in building human resource functions that serve strategic business needs. Her practice includes small to medium-sized businesses in a wide range of industries including biotechnology, mortgage lending, high technology, public relations, retail, nonprofit, and construction. Ms. Bogardus is also the author of an introductory book for non-HR business professionals, Human Resource Jumpstart, also published by Wiley.
About the Technical Editors
Laura Owen’s career spans 30 years of providing strategic and day-to-day functional human resources leadership and direction at leading technology companies. An employment attorney with both senior and global human resource professional certifications (SPHR and GPHR), she is currently Vice President, Human Resources, for Spirent Communications, where she is leading change management initiatives including organizational design, new compensation plans, and an effective employee communications architecture. Ms. Owen has previously held executive-level positions managing global human resources for leading technology companies including Cisco Systems, Macrovision, and Credence. She earned a J.D., magna cum laude, degree from Santa Clara University School of Law and a B.S. in Personnel and Industrial Relations, magna cum laude, from San Francisco State University.
Tamra Aguinaldo, PHR, has a background in human resources and education and currently works as an HR consultant in Northern California. She has a Master of Arts degree in Education with an emphasis in Guidance Counseling. Prior to becoming a consultant, she was Director of Professional Development for the Northern California Human Resources Association in San Francisco.
HR is a dynamic profession requiring practitioners to keep up-to-date with current trends and changes to employment law. The PHR/SPHR exams are updated annually to reflect these trends and changes. For information updates between revisions of this study guide, log on to www.starhronline.com, and click PHR/SPHR Certification to view changes or ask questions about content.

Congratulations on taking the first step toward achieving your Professional in Human Resources (PHR) or Senior Professional in Human Resources (SPHR) certification! The process you are embarking upon is rewarding and challenging, and as more than 96,000 of your fellow human resource colleagues have already discovered, it’s an excellent opportunity to explore areas of human resource management with which you may not work every day. In the next few pages, you will find some general information about human resource certification, some suggestions for using this book, information about what to expect in the following chapters, and a discussion of the organizations involved in certification.
Before we begin, a word about what you should already know. This study guide was designed to serve as a refresher for experienced professionals who have practiced HR for a minimum of two years. I assume that those who are pursuing certification have the basic HR knowledge that comes not only from education in human resources but also, more importantly, from exempt-level experience. If your daily work is truly generalist in nature, you likely have touched upon many of the topics I cover, but you may not have in-depth knowledge in all of them. Conversely, if you specialize in one or two areas of HR, you probably have extensive experience in those areas but may need to refresh your knowledge in other areas.
The goal of this study guide is to provide enough information about each of the functional areas of human resource management to enable candidates in either situation to find what they need to prepare themselves for successfully completing the exam. There are more than 22,000 books related to human resources listed on Amazon.com alone, and there is obviously no way I can cover all the aspects of HR in a single book. So, I’ve organized the information around the test specifications (test specs) established by the Human Resource Certification Institute (HRCI), the certifying body for our profession. I’ll talk more about the test specs in Chapter 1, “Certifying Human Resource Professionals,” but for now, suffice it to say that the key to success on the exam is a thorough understanding of and ability to apply the test specs when answering questions on the exams.

About Human Resource Certification

What exactly is human resource certification? Briefly, let’s just say that certification is a way of acknowledging individuals who have met the standard of competency established by HR practitioners as that which is necessary to be considered a fully competent HR professional. To understand whether this book is for you, you’ll want to know why you should become certified and how the certification process works.

Who Certifies HR Professionals?

Three organizations are involved in the certification of human resource professionals: the Human Resource Certification Institute (HRCI), the Society for Human Resource Management (SHRM), and the Professional Examination Service (PES).

The Human Resource Certification Institute

HRCI is the certifying body for the human resource profession. It was formed by the American Society of Personnel Administrators (ASPA) in 1972, when it was known as the ASPA Accreditation Institute (AAI). In its early stages, HRCI was financially dependent upon SHRM, but it is now financially independent. Both HRCI and SHRM have individual boards of directors that govern their operations. Although HRCI and SHRM have a long history of affiliation and mutual support, the certification process is a separate and distinct function of HRCI, and SHRM has no more control over or access to the certification process than does anyone else in the profession.
You can find HRCI’s organizational mission statement at www.hrci.org/AboutUs/MISVIS/.

The Society for Human Resource Management

SHRM is the largest organization of human resource professionals in the world, representing more than 235,000 members worldwide at the end of 2007. From its beginning in 1948 as the American Society for Personnel Administrators (ASPA), SHRM has been a leader in the endeavor to gain recognition for the human resource profession. Today’s certification program is a direct result of efforts by the first volunteer members of SHRM, who recognized the need for a defined body of knowledge and set about to develop it along with a certification process that evaluates the abilities of practitioners in the field.

Professional Examination Service

PES is a nonprofit organization that conducts license and credential examinations for a wide variety of professions, including psychology, pharmacy, real estate appraisal, and security management, among many others. PES maintains the database of test items developed by HRCI and is responsible for ensuring that applicants for the PHR and SPHR exams meet the eligibility requirements, administering and scoring the tests, and notifying candidates of the results. In 2005, PES conducted the most recent review of the body of knowledge, called a practice analysis study, to ensure the continued relevance of the credentialing process to current business practices.
I will refer to these organizations frequently in Chapter 1 as I discuss the body of knowledge and the certification process.

Why Become Certified?

Over time, the certification offered by HRCI has become the industry standard for determining competence in the field of human resources. There are many reasons that individuals may decide to seek professional certification. Let’s talk about just a few of them.
First, certification is an acknowledgement that you have met the standards of excellence determined by other HR professionals to be those that are necessary to be fully competent in the field. Because the standards are developed by working professionals, not just by those who teach and consult in the field, this credential demonstrates that you are a fully competent HR practitioner based on a standard set by your peers.
Second, certification is a way to increase your marketability. In difficult economic times, when there is tough competition for jobs, certification provides an edge that can be advantageous in your job search. With an abundance of job seekers for a limited number of jobs, whatever you can do to set yourself apart from the crowd can give you the edge when potential employers are making the final hiring decision.
Third, those who spend the time to advance their own knowledge and achieve certification have demonstrated their ability to continue learning and growing as times and business needs change. A person who is willing and able to set a significant goal and do what is necessary to achieve it demonstrates characteristics that are in great demand in business today: results orientation, technical competence, commitment, and excellence.
Finally, certification enhances your credibility with co-workers and customers by demonstrating to the people you encounter during your workday that you have proven competence within the field.
Whether your reason for seeking certification falls into one of these categories or you are motivated to do so for some other reason, it can be a great opportunity to validate how much you already know about the practice of human resources as a profession.

How to Become Certified

To become a certified HR professional, you must pass either the PHR or SPHR exam, both of which have been developed by HRCI in a comprehensive process described in Chapter 1.
HRCI uses a computer-based testing (CBT) process during two time periods each year: between the beginning of May and the end of June, and from mid-November through mid-January. One advantage of the CBT process is that exam candidates know before they leave the testing center whether they are certified.
Each exam, PHR and SPHR, consists of 225 questions. Of these questions, 200 are scored to determine whether you pass the exam. The additional 25 questions are being “pretested” in order to determine their reliability and validity for inclusion in future test cycles. You can find a detailed discussion of how the questions are developed and scored in the HRCI PHR & SPHR Certification Handbook, which can be viewed and/or downloaded at the HRCI website (www.hrci.org), or you can request a hard copy from HRCI by calling (866) 898-4724. The handbook is an essential guide to all aspects of the exams and includes test dates, application deadlines, fee information, and answers to frequently asked questions about the certification process, as well as the full list of test specifications.
Chapter 1 explains in greater detail how much and what kinds of experience are required for each exam level and how the questions differ on each level.

How This Book Is Organized

I’ve talked a little bit about Chapter 1, which provides information about requirements for certification and the testing process. Chapter 1 also provides some suggestions on the best ways to study for the exam.
Chapter 2, “Core Knowledge Requirements for HR Professionals,” provides a brief discussion of knowledge with implications in multiple functional areas. Reading this chapter first gives exam candidates a base for understanding topics covered in subsequent chapters.
Chapters 3-8 get down to the specifics of each functional area and discuss the test specifications in detail. Each of these chapters consists of a list of objectives, an overview of the functional area, the federal employment laws applicable to that area, and a discussion of the test specs, including the appropriate court cases.
I have also provided three appendices to facilitate your study. Appendix B, “Case Study,” gives you an opportunity to pull information from multiple functional areas to solve typical HR challenges in a fictitious company.
Appendix C, “Federal Employment Legislation and Case Law,” is a chronological listing of the federal legislation appearing throughout the book, as well as significant court decisions with implications for human resources. This appendix also includes additional court decisions that were not discussed in the chapters but have significance for HR practice and with which you should be familiar, so be sure to review them. They are included in a separate section of the appendix.
Appendix D, “Resources,” is just that: a list of additional sources of information about each of the functional areas of human resources.
Finally, I have included a glossary, an alphabetical listing of all the key terms throughout the book with their corresponding definitions.
For up-to-the-minute updates on this book, please see my website at starhronline.com or www.sybex.com/go/phrstudyguide3rdedition.

The Elements of a Study Guide

You’ll see many recurring elements as you read this study guide. Here’s a description of some of those elements:
Summary The summary is a brief review of the chapter to sum up what was covered.
Exam essentials The “Exam Essentials” section at the end of each chapter highlights topics that could appear on one or both of the exams in some form. While I obviously do not know exactly what will be included in a particular exam, these sections reinforce significant concepts that are key to understanding the functional area and the test specs HRCI has developed.
Key terms Throughout each chapter, I’ve identified and defined key terms that exam candidates will need to understand. These are listed at the end of the chapter and defined in the glossary at the end of the book.
Chapter review questions Each chapter includes ten practice questions designed to measure your knowledge of key ideas discussed in the chapter. After you finish each chapter, answer the questions; if some of your answers are incorrect, it’s an indication that you need to spend some more time studying that topic. The answers to the practice questions follow the last question in each chapter. The chapter review questions are designed to help you measure how much information you retained from your reading and are different from the kinds of questions you will see on the exam.

What’s on the CD?

The CD provides some essential tools to help you with your preparation for the certification exam. All the following gear should be loaded on your computer when studying for the test.

The Sybex Test Preparation Software

The test preparation software, made by experts at Sybex, helps prepare you to pass the PHR/SPHR exams. In this test engine, you will find all the review and assessment questions from the book, plus two additional bonus exams that appear exclusively on the CD. You can take the assessment test, test yourself by chapter, or take the bonus exams.
Just as on the certification exams, the bonus exam questions on the CD draw upon your experience as an HR professional. Be on the lookout for questions based upon your everyday activities in HR and not just on the material in the PHR/SPHR study guide.

Electronic Flashcards for PC and Palm Devices

Sybex’s electronic flashcards include more than 200 PHR questions and more than 200 SPHR questions designed to challenge you further for the PHR and SPHR exams. Between the review questions, bonus exams, and flashcards, you’ll have a wide variety of materials to help you prepare!

PHR/SPHR Study Guide in PDF

Sybex offers the PHR/SPHR: Professional in Human Resources Certification Study Guide in PDF on the CD so you can read the book on your PC or laptop if you travel and don’t want to carry a book or if you just like to read from the computer screen. Acrobat Reader is also included on the CD.

How to Use This Book and CD

This book has a number of features designed to guide your study efforts for either the PHR or the SPHR certification exam. All of these features are intended to assist you in doing the most important thing you can do to pass the exam: understand and apply the test specs in answering questions. This book helps you do that by listing the current test specs at the beginning of each chapter and by ensuring that each of them is fully discussed within the chapter. The practice questions at the end of each chapter and the practice exams on the CD are designed to assist you in testing your retention of the material you’ve read to make you aware of areas in which you should spend additional study time. I’ve provided web links and other resources to assist you in mastering areas where you may require additional study materials. Here are some suggestions for using this book and CD:
• Take the assessment test before you start reading the material. These questions are designed to measure your knowledge and will look different from the questions you will see on the exam. They are designed to give you an idea of the areas in which you need to spend additional study time, as well as those areas in which you may just need a brief refresher.
• Review the test specs at the beginning of each chapter before you start reading. Make sure you read the associated knowledge requirements in HRCI’s PHR and SPHR Certification Handbook because these may help you in your study process. After you’ve read the chapter, review them again to make sure you understand and are able to apply them.
• Answer the review questions after you’ve read each chapter; if you missed any of them, go back over the chapter and review the topic, or utilize one of the additional resources if you need more information.
• Make sure you understand the laws that apply to each functional area, the information covered in each of them, and to which companies or government agencies they apply.
• Download the flashcards to your handheld device, and review them when you have a few minutes during the day.
• Take every opportunity to test yourself. In addition to the assessment test and review questions, there are bonus exams on the CD. Take these exams without referring to the chapters, and see how well you’ve done—go back and review any topics you’ve missed until you fully understand and can apply the concepts.
Finally, find a study partner if possible. Studying for, and taking, the exam with someone else will make the process more enjoyable, and you’ll have someone to help you understand topics that are difficult for you. You’ll also be able to reinforce your own knowledge by helping your study partner in areas where they are weak.

Assessment Test
1. According to the WARN Act, an employer with 200 employees is required to provide 60 days’ notice of a mass layoff when:
a. The employer is seeking additional funding and will lay off 70 employees if the funding falls through.
b. A major client unexpectedly selects a new vendor for the company’s products and the company lays off 75 employees.
c. The employer lays off 5 employees a week for 3 months.
d. A flood requires that one of the plants be shut down for repairs and 55 employees are laid off.
2. An employee has come forward with an allegation of quid pro quo harassment by her supervisor. As the HR manager, you are responsible for investigating the complaint. The supervisor in question is someone with whom you have become quite friendly. In this case, who is the best person to conduct the investigation?
a. You
b. The corporate attorney
c. The direct manager of the accused supervisor
d. A third-party investigator
3. As of July 24, 2009, the federal minimum wage is set at:
a. $5.15 per hour
b. $7.25 per hour
c. $5.75 per hour
d. $6.55 per hour
4. During the union organizing process, how is the bargaining unit determined?
a. By the union organizers
b. Jointly, by the union and the employer
c. By the National Labor Relations Board
d. By the employees during the election
5. The motivation theory that suggests people are motivated by the reward they will receive when they succeed and that they weigh the value of the expected reward against the effort required to achieve it is known as:
a. Vroom’s Expectancy Theory
b. Adams’ Equity Theory
c. McClelland’s Acquired Needs Theory
d. McGregor’s Theory X and Theory Y
6. What is the most effective method of performance evaluation?
a. A field review process
b. A continuous feedback process
c. A forced ranking process
d. A behaviorally anchored rating scale process
7. Which of the following is an example of a nonqualified deferred compensation plan?
a. An excess deferral plan
b. A target benefit plan
c. A money purchase plan
d. A cash balance plan
8. Which of the following is an example of a passive training method?
a. Vestibule training
b. Demonstration
c. Distance learning
d. Self-study
9. What is the purpose of the OSHA consulting service?
a. Helps employers identify the OSHA standards that apply to their workplace
b. Fines employers for violating OSHA safety standards
c. Does not require compliance with OSHA standards
d. Acts as a one-time service
10. One purpose of a diversity initiative is to:
a. Increase workplace creativity
b. Increase the effectiveness of the workforce
c. Increase the organization’s ability to attract customers
d. All of the above
11. What is an employer’s responsibility when workplace conditions pose a threat to an unborn child?
a. Do nothing. It is up to employees to protect their unborn children.
b. Move the employee into a different job that does not pose a threat to the unborn child.
c. Advise the employee of the potential threat, and allow the employee to make the decision.
d. Allow only sterile employees to work in jobs that pose a threat to unborn children.
12. What does the Health Insurance Portability and Accountability Act do?
a. Prevents HR from investigating claims issues
b. Requires continuation of health benefits
c. Established EPO networks
d. Limits preexisting condition restrictions
13. The concept that recognizes businesses are social organizations as well as economic systems and productivity is related to employee job satisfaction is known as:
a. Human resource management
b. Strategic management
c. Human relations
d. Human resource development
14. Before selecting an HRIS system, which of the following questions should be answered?
a. What information will be converted to the HRIS?
b. Who will have access to the information stored in the HRIS?
c. How will the HRIS be accessed?
d. All of the above.
15. The correlation coefficient is a statistical measurement that is useful for:
a. Determining whether one variable affects another
b. Compensating for data that may be out of date
c. Determining which variables are outside acceptable ranges
d. Describing standards of quality
16. The process of identifying risks and taking steps to minimize them is referred to as:
a. Liability management
b. Risk management
c. Qualitative analysis
d. Risk assessment
17. What is the most effective method to utilize when an employer wants to obtain insight into employee goals and job satisfaction and provide career counseling to those in the work group?
a. An employee survey
b. A skip-level interview
c. An employee focus group
d. A brown-bag lunch
18. Which of the following is an example of workplace ethics issues?
a. Workplace privacy
b. Conflicts of interest
c. Whistle-blowing
d. All of the above
19. Which of the following statements about substance abuse policies is not true?
a. Substance abuse policies identify who will be tested.
b. Federal law requires all employers to implement substance abuse policies.
c. An effective policy describes when tests will occur and what drugs will be tested.
d. An effective policy describes what happens to employees who test positive.
20. Which one of the following statements is true of a hostile work environment?
a. When a single incident of unwanted touching occurs, a hostile work environment has been created.
b. A hostile work environment may be created when an individual witnesses the ongoing harassment of a co-worker.
c. Only a supervisor can create a hostile work environment.
d. A grievance procedure/policy against discrimination protects employers from hostile work environment claims.
21. An HR audit is designed to help management:
a. Improve employee morale.
b. Analyze HR policies, programs, and procedures against applicable legal requirements.
c. Improve HR effectiveness.
d. All of the above.
22. Which of the following is a productivity type of statistical HR measurement?
a. Turnover and retention
b. Cost per hire
c. Revenue per employee
d. Job satisfaction
23. Federal legislation does not specifically prohibit disparate treatment of caregivers, but claims of disparate treatment for employees caring for elders, children, or disabled family members increased 450 percent between 1990 and 2005. On what basis are these claims filed?
a. Title VII
b. Americans with Disabilities Act
c. Family Medical Leave Act
d. All of the above
24. A statement of cash flows is a financial report that tells you:
a. The financial condition of the business at a specific point in time
b. Where the money used to operate the business came from
c. The financial results of operations over a period of time
d. How much money is owed to the company by its customers
25. According to the Copyright Act of 1976, which of the following is most likely to be considered a fair use of copyrighted material?
a. Distributing 30 copies of a chapter in a book to a study group
b. Copying a book for 10 staff members of a nonprofit organization
c. Distributing 30 copies of a paragraph in a book to a study group
d. None of the above
26. A PEST analysis is used during the strategic planning process. PEST is an acronym for:
a. Political, environmental, strengths, threats
b. Political, economic, specific, timely
c. Political, economic, social, technology
d. Product, environment, social, technology
27. Which of the following organizational structures is characterized by networks instead of traditional hierarchies?
a. Seamless organization
b. Geographic organization
c. Flat organization
d. Matrix organization
28. The Occupational Safety and Health Act of 1970 grants employees the right to do all of the following except:
a. Be advised of potential safety hazards.
b. Speak privately to an OSHA inspector during an inspection.
c. Observe the employer when measuring and monitoring workplace hazards.
d. View detailed reports of all workplace accidents.
29. Which of the following alternative staffing methods would be most appropriate for a company with ongoing yet sporadic needs for a specific job to be done?
a. Intern program
b. On-call worker
c. Seasonal worker
d. Temp worker
30. A standard employment practice that seems to be fair yet results in discrimination against a protected class is a description of:
a. Disparate treatment
b. Disparate impact
c. Adverse impact
d. Unfair treatment
31. Which of the following is required by the Economic Growth and Tax Relief Reconciliation Act of 2001?
a. Requires pension plans to account for employee contributions separately from employer contributions
b. Allows employers to contribute a percentage of company earnings to retirement plans each year
c. Allows employees older than 50 to make catch-up contributions to retirement accounts
d. Requires employer pension contributions to be funded on a quarterly basis
32. Measuring staffing needs against sales volume could be done most effectively by using which of the following techniques?
a. A multiple linear regression
b. A ratio
c. A simulation model
d. A simple linear regression
33. Which of the following points is important to effective lobbying, that is, attempting to influence or persuade an elected official to pass, defeat, or modify a piece of legislation?
a. Learning how the legislative and political process works
b. Beginning by using persuasion to convince the elected official to accept your position
c. Making big financial contributions
d. Letting the elected official choose a solution rather than present a proposal solution
34. The Vietnam Era Veterans Readjustment Assistance Act (VEVRA) requires that
a. All contractors list all job openings with state employment agencies
b. All employers list all job openings with state employment agencies
c. State employment agencies give preference to Vietnam veterans for senior-level management position referrals
d. State employment agencies give preference to Vietnam veterans for positions lasting three days or longer
35. The FLSA requires employers to pay nonexempt employees for time spent:
a. At home while waiting to be called to work
b. At work reading a book while waiting for an assignment
c. Attending a voluntary training program
d. Commuting to work
36. What provides the framework for collecting information about factors that are relevant to the planning process?
a. A SWOT analysis
b. A PEST analysis
c. An environmental scan
d. An internal assessment
37. A process for reducing the impact of bias during performance reviews by using multiple raters is known as:
a. Interrater reliability
b. An MBO review
c. A rating scale
d. Paired comparison
38. According to the OSHA inspection priorities, which type of workplace hazard receives first priority for an inspection?
a. Catastrophes and fatal accidents
b. Programmed high-hazard inspections
c. Imminent danger
d. Employee complaints
39. A lockout occurs when:
a. The employees shut down operations by refusing to work.
b. The employer refuses to allow the union to unionize the workplace.
c. The employer shuts down operations to keep employees from working.
d. The employees patrol the entrance to the business.
40. Total quality management focuses all employees on producing products that meet customer needs. This is done by:
a. Eliminating processes that waste time and materials
b. Developing a high level of expertise in all employees
c. Sharing information with all levels in the organization
d. Balancing the needs of all stakeholders in the organization
41. A high-involvement organization is an example of what type of OD intervention?
a. Human process
b. Human resource management
c. Techno-structural
d. Strategic
42. An employee earning $22,500 per year supervises three employees and spends 35 hours per week on essential job duties that require discretion and independent judgment. Is this employee:
a. Exempt, based on the executive exemption test
b. Exempt, based on the administrative exemption test
c. Nonexempt, based on the salary basis requirement
d. Nonexempt
43. Health and wellness programs are beneficial for employers because they:
a. Increase productivity, reduce medical costs, and attract top-quality job candidates
b. Provide nutrition counseling, exercise programs, and health education programs
c. Require employees to lose weight, stop smoking, and avoid substance abuse
d. Provide on-site opportunities for physical fitness
44. An effective progressive disciplinary process begins with:
a. A written warning
b. A verbal warning
c. A suspension
d. Coaching or counseling
45. Which of the following would be considered an extrinsic reward?
a. Challenging work on a new project
b. A 10 percent salary increase
c. A feeling of accomplishment after completing a tough assignment
d. Recognition by the CEO at a company meeting
46. “Thanks for such a great presentation! You’ll always have a job with us.” This is an example of:
a. The duty of good faith and fair dealing
b. An express contract
c. An implied contract
d. Fraudulent misrepresentation
47. Samantha is hiring an outside sales rep for a new sales territory. Part of the selection process included an assessment test that measures successful sales characteristics. Samantha scored particularly high on the test. During the interview, Christopher, the hiring manager, had some concerns about how well Samantha would fit into the company culture, but when he learned how high she scored on the test, he immediately decided to hire her. What bias could be at work in this situation?
a. Halo effect
b. Knowledge-of-predictor effect
c. Cultural noise effect
d. Stereotyping effect
48. What is an Excelsior list?
a. A list of all employees in the bargaining unit provided by the employer to the union within seven days of the scheduling of an election by the NLRB
b. A list of the employees who do not want the union to represent them
c. A list of the employees who have signed authorization cards for the union
d. A list of all employees in the bargaining unit provided by the union to the employer within seven days of the scheduling of an election by the NLRB
49. Which of the following activities is not a responsibility of the operations function of a business?
a. Designing the product
b. Scheduling production runs to coincide with customer demand
c. Ensuring that products or services meet quality standards
d. Determining what new products will be produced
50. Which of the following activities does not contribute to ergonomic injuries?
a. Awkward postures
b. Extended vibrations
c. Falling down stairs
d. Contact stress
51. What is a target benefit plan?
a. Uses actuarial formulas to calculate individual pension contribution amounts
b. Requires an actual deferral percentage test to be performed each year
c. Provides a means for employees to become owners of the company
d. Uses a fixed percentage of employee earnings to defer compensation
52. To increase the chances for successful repatriation of employees, the process should include:
a. Development of a qualified pool of candidates for global assignments
b. A formal repatriation program that includes career counseling
c. Setting expectations for repatriation before employees begin global assignments
d. All of the above
53. Richard, who works at the customer service counter in an auto supply store, told his manager that because of chronic back pain, it is difficult for him stand to for long periods and asked for an accommodation. The manager isn’t sure, based on the essential job functions, how an accommodation can be provided. You advise the manager to begin the interactive process with the employee. What should the manager do to begin this process?
a. Ask Richard how his back was injured.
b. Provide a stool for Richard to use at the counter.
c. Ask Richard whether he has any suggestions for an accommodation.
d. Ask Richard to meet with HR to resolve the problem.
54. Human resource professionals are likely to use third-party contracts when doing which of the following?
a. Conducting a job evaluation
b. Hiring a temporary employee
c. Writing the employee handbook
d. Hiring a full-time executive
55. Which of the following is an example of direct compensation?
a. Variable compensation
b. Vacation pay
c. 401(k) matches
d. Employer Social Security contributions
56. For purposes of developing a security program, an HR manager must assess potential risks and costs related to loss and protection. Which factor must the manager first examine?
a. Severity of impact of the loss to the organization
b. Cost of the loss, including a permanent or temporary substitute
c. Degree of probability that the loss will occur
d. Availability and cost of insurance to cover the loss
57. A correlation coefficient is an example of a type of:
a. Qualitative analysis
b. Quantitative analysis
c. Job evaluation
d. Learning matrix
58. An organizational picket may lawfully take place when:
a. The union members are unhappy with their current union and ask a new union to represent them.
b. The union files a representation petition with the NLRB no later than 15 days after picketing starts.
c. There are less than 45 days left before the current collective bargaining agreement expires.
d. The union wants to attract employees so they will authorize the union to represent them.
59. Arbitrators chosen by all parties to resolve any disputes arising between them in the future are known as:
a. tripartite arbitrators
b. compulsory arbitrators
c. ad hoc arbitrators
d. permanent arbitrators
60. When the NLRA imposes a voluntary recognition bar, this means that:
a. No election will take place for a reasonable period of time.
b. The NLRB has certified a bargaining representative.
c. The union withdrew its petition for an election.
d. A representation election took place within the previous 12 months.

Answers to Assessment Test
1. C. The WARN Act requires employers to provide 60 days’ notice when 500 employees or 33 percent of the workforce are laid off, and it requires the number be counted over a period of 90 days. Five employees a week for 3 months is a total of 65 employees (5 employees times 13 weeks), which is 33 percent of the workforce. The three exceptions are the “faltering company exception” (A) when knowledge of a layoff will negatively impact the company’s ability to obtain additional funding, the “unforeseeable business circumstance” (B) when unexpected circumstances occur, and the “natural disaster” (D) exception. (See Chapter 4.)
2. D. In this case, the organization will be best served by a third-party investigator. The most important consideration in an investigation of sexual harassment is that the investigator is seen as credible and impartial. Since you have become friendly with the accused, it will be difficult to maintain impartiality during an investigation. While the corporate attorney (B) may be selected to conduct investigations, this solution can lead to conflict of interest issues. The direct manager of the accused supervisor (C) may not be viewed as impartial by the accuser or by regulatory agencies. (See Chapters 2 and 8.)
3. B. As of July 24, 2009, the federal minimum wage was raised to $7.25 per hour from (D) $6.55 per hour that became effective on July 24, 2008. The minimum wage in some states and other localities may be different. (See Chapter 6.)
4. C. The National Labor Relations Board (NLRB) determines which jobs will be included in the bargaining unit based on the “community of interest” shared by the requirements of the jobs. (See Chapter 7.)
5. A. Vroom explains his theory with three terms: expectancy (the individual’s assessment of their ability to achieve the goal), instrumentality (whether the individual believes they are capable of achieving the goal), and valence (whether the anticipated goal is worth the effort required to achieve it). Adams’ Equity Theory (B) states that people are constantly comparing what they put into work to what they get from it. McClelland’s Acquired Needs Theory (C) states that people are motivated by one of three factors: achievement, affiliation, or power. McGregor’s Theory X and Theory Y (D) explain how managers relate to employees. Theory X managers are autocratic, believing that employees do not want to take responsibility. Theory Y managers encourage employees to participate in the decision-making process, believing that they respond to challenges. (See Chapters 2 and 5.)
6. B. A continuous feedback review process is most effective because it provides immediate feedback to employees, enabling them to correct performance issues before they become major problems. In a field review (A), reviews are conducted by someone other than the direct supervisor. Forced ranking (C) is an evaluation method in which all employees are listed in order of their value to the work group. The BARS process (D) identifies the most important job requirements and creates statements that describe varying levels of performance. (See Chapter 5.)
7. A. An excess deferral plan makes up the difference between what an executive could have contributed to a qualified plan if there had not been a limit on contributions and how much was actually contributed because of the discrimination test required by ERISA. These plans are nonqualified because they are not protected by ERISA; they are limited to a small group of executives or highly compensated employees. A target benefit plan (B) is a hybrid with elements of defined benefit and money purchase plans. A money purchase plan (C) defers a fixed percentage of employee earnings. A cash balance plan (D) combines elements of defined benefit and defined contribution plans. (See Chapter 6.)
8. C. Distance learning is similar to a lecture in that a presenter provides information to a group of participants but does not require active participation. Vestibule training (A) is a form of simulation training. Demonstration (B) is an experiential training method. Self-study (D) is an active training method. (See Chapters 2 and 5.)
9. A. OSHA consultants provide free services to assist employers in identifying workplace hazards and the standards that apply in their workplaces. The consulting service requires employers to abate any hazards that are identified during the consultation but does not fine them for violations. To receive a free consultation, employers must agree to advise OSHA of changes in operating processes that may require additional consultations. (See Chapter 8.)
10. B. The purpose of a diversity initiative is to increase the effectiveness of an already diverse workforce by educating the employee population about the benefits of a diverse workforce, which include increased creativity (A) and an enhanced ability to attract customers (C). (See Chapter 2.)
11. C. The Supreme Court determined in Automobile Workers v. Johnson Controls, Inc. that it is the responsibility of prospective parents to protect their unborn children. Although employers must provide information about potential hazards, the employer may not decide for the employee whether to work in a job that poses a risk to an unborn child. (See Chapter 8.)
12. D. HIPAA prohibits health insurance providers from discriminating on the basis of health status and limited restrictions for preexisting conditions. HIPAA does not prevent HR from investigating claims issues (A) as long as the employee provides written permission. COBRA requires continuation of health benefits (B). EPO networks (C) are established by physicians connected to a hospital. (See Chapter 6.)
13. C. The concept of human relations was first introduced in the 1920s and challenged previous assumptions that people work only for economic reasons and could be motivated to increase productivity simply by increasing monetary incentives. Human resource management (A) is the business function responsible for activities related to attracting and retaining employees, including workforce planning, training and development, compensation, employee and labor relations, and safety and security. Strategic management (B) is the process by which organizations look for competitive advantages, create value for customers, and execute plans to achieve goals. Human resource development (D) is the functional area of human resources focused on upgrading and maintaining employee skills and developing employees for additional responsibilities. (See Chapters 2 and 5.)
14. D. A needs analysis will provide answers to these questions, as well as whether the HRIS will be integrated with payroll or other systems and what kinds of reports will be produced. (See Chapters 2 and 3.)