Chapter 10: Managing Human Resources TRUE/FALSE 1. Human resource management is the process of finding, developing, and keeping the right people to form a qualified workforce. Answer: True 2. The only time that sex, age, religion, and the like can be used to make employment decisions is when they are considered a bona fide occupational qualification. Answer: True 3. There are three sets of federal laws that are important to the human resource management process. They are federal employment laws, federal labor laws (which regulate the interaction between management and labor unions that represent groups of employees), and the Occupational Safety and Health Act. Answer: True 4. Disparate treatment and adverse impact are defined in labor laws issued by the National Labor Relations Board. Answer: False These criteria are defined in the Uniform Guidelines on Employee Selection Procedures, which were jointly issued by the Equal Employment Opportunity Commission, the Department of Labor, the U.S. Justice Department, and the federal Office of Personnel Management. 5. The Uniform Guidelines on Employee Selection Procedures are one of the most important federal guidelines that organizations can use to ensure they are in compliance with federal employment laws. Answer: True 6. In legal terms, intentional discrimination by an employer is identified as adverse impact, while unintentional discrimination is called disparate impact. Answer: False In legal terms, intentional discrimination by an employer is identified as disparate treatment, while unintentional discrimination is called adverse impact. 7. The hostile work environment form of sexual harassment occurs when employment outcomes, such as hiring, promotion, or simply keeping one’s job, depend on whether an individual submits to being sexually harassed. Answer: False This is the definition of quid pro quo sexual harassment. By contrast, a hostile work environment occurs when unwelcome and demeaning sexually related behavior creates an intimidating, hostile, and offensive work environment. 8. Full compliance with federal law is enough to ensure that an organization cannot incur liability in sexual harassment complaints. Answer: False Compliance with federal law is often not enough. In fact, organizations can be in full compliance with federal law, while at the same time violating state or local sexual harassment laws. 9. Job analysis is a purposeful and systematic process for collecting information on the important work-related aspects of a job. Answer: True 10. A job specification summarizes the basic tasks, duties, and responsibilities of a job, and a job description summarizes the qualifications needed to successfully perform the job. Answer: False A job description summarizes the basic tasks, duties, and responsibilities of a job, while a job specification summarizes the qualifications needed to successfully perform the job. 11. Job analyses, job descriptions, and job specifications help companies meet the legal requirement that their human resource decisions be job related. Answer: True 12. Validation is the process of determining how well a selection test or procedure predicts future job performance. Answer: True 13. According to the “Doing the Right Thing” box on not embellishing your résumé, you should remember the information you include on your résumé is legally binding. Answer: True 14. Background checks can be used to verify the truthfulness and accuracy of information that applicants provide about themselves. Answer: True 15. Cognitive ability tests are also called aptitude tests. Answer: False Specific ability tests are also called aptitude tests. 16. According to the “Doing the Right Thing” box, lie detectors and handwriting analyses are good tools to use when making human resources decisions. Answer: False The title of the box is “Don’t Use Psychics, Lie Detectors, or Handwriting Analysis to Make HR Decisions.” 17. If human resource manager were allowed to use just one selection test, cognitive ability tests would be the one to use. Answer: True 18. Since interviews are especially good at assessing applicants’ interpersonal skills, they work especially well together with cognitive ability tests, where the combination leads to even better selection decisions than using either alone. Answer: True 19. Training provides opportunities for employees to develop the job-specific skills, experience, and knowledge they need to do their jobs or improve their performance. Answer: True 20. Behavior observation scales ask raters to rate the frequency with which workers perform specific behaviors representative of the job dimensions that are critical to successful job performance. Answer: True 21. When participants in the Survivor television series are each asked to answer questions such as “Who within the group does the least work?” and “Who within the group is most friendly?” it is a form of 360-degree feedback because the answers are revealed to everyone. Answer: True 22. In setting their pay structures, companies use a procedure known as performance assessment, which determines the worth of each job by determining the market value of the knowledge, skills, and requirements needed to perform it. Answer: False This procedure is actually known as job evaluation, not performance assessment. 23. Piecework, sales commission, profit sharing, employee stock ownership plans, and stock options are common pay-variability options. Answer: True 24. There are no legally mandated employee benefits. Answer: False The three employee benefits mandated by law are Social Security, workers’ compensation insurance, and unemployment insurance. 25. Another name for the flexible benefit plan is the cafeteria benefit plan. Answer: True 26. Businesses that adhere to participative management theories believe it is motivational to fire unproductive employees in front of their peers rather than behind closed doors. Answer: False Employees should always be fired in private. 27. Wrongful discharge is a legal doctrine that requires a manager to have the approval of the human resource manager to terminate employees. Answer: False Wrongful discharge is a legal doctrine that requires employers to have a job-related reason to terminate employees. 28. Outplacement services provide businesses with a way to outsource common business practices, such as telemarketing and the mailing of monthly statements, without having to do an expensive search. Answer: False Outplacement services provide employment counseling services for employees faced with downsizing. They often include advice and training in preparing résumés, getting ready for job interviews, and even identifying potential job opportunities. 29. Once a company finishes the downsizing process, it should never need to downsize again. Answer: False Two-thirds of companies that downsize will downsize a second time within a year. 30. Employee turnover is always bad for an organization. Answer: False Not all kinds of employee turnover are bad for organizations. In fact, some turnover can actually be good. For instance, functional turnover is the loss of poor-performing employees who choose to leave the organization. 31. When AES, a utility company, was able to terminate some of its least productive workers by getting them to accept a generous severance package, it created proactive turnover. Answer: False It created functional turnover. 32. Dysfunctional turnover is the loss of high-performing employees due to unplanned downsizing. Answer: False Dysfunctional turnover is the loss of high-performing employees who voluntarily choose to leave a company. MULTIPLE CHOICE 1. _____________ is the process of finding, developing, and keeping the right people to form a qualified workforce. A. Functional resource planning B. Human resource management C. Workforce forecasting D. Recruiting E. Human resource implementation Answer: B Definition of human resource management. 2. Which of the following statements about federal employment law is true? A. This body of law has not changed during the last two decades. B. The intent of antidiscrimination law is to make factors such as sex, race, or age irrelevant in employment decisions. C. Federal law prohibits the use of sex, race, and age as the basis for employment decisions under all circumstances. D. All federal laws are administered by the Department of Labor. E. Federal employment laws do not deal with training and development activities. Answer: B The Family and Medical Leave Act was passed in 1993. Bona fide occupational qualification allows the use of sex, race, and age as the basis for employment decisions under some circumstances. The Equal Employment Opportunity Commission administers the federal law. Federal laws apply to the entire human resource management process. 3. To which of the following aspects of the human resource management process does federal employment law apply? A. selection decisions B. compensation decisions C. performance appraisals D. training and development activities E. all of these Answer: E Federal employment law applies to all of these aspects. 4. The fact a 98-pound job candidate is not hired as a dock worker to move 60-pound boxes of produce is legal as a result of: A. the four-fifths rule B. adverse impact rulings C. bona fide occupational qualifications (BFOQs) D. sex selectivity E. benefits and features for occupational qualities (BFOQs) Answer: C A BFOQ is an exception in employment law that permits sex, age, religion, and the like to be used when making employment decisions. 5. Engineered Fabrics makes bladders for airplane gas tanks. In the event of a puncture, the bladder will prevent the tank from exploding. The bladders must be defect free. To check the bladders, company employees must be able to crawl in an 18-inch diameter hole in the bladder side and look for light leaks. A limitation on weight and height of individuals working in quality control at this company would be legal because it is an example of: A. the four-fifths rule B. adverse impact rulings C. bona fide occupational qualifications (BFOQs) D. sex selectivity E. benefits and features of occupational qualities (BFOQs) Answer: C A BFOQ is an exception in employment law that permits sex, age, religion, and the like to be used when making employment decisions. 6. _____________ is intentional discrimination that occurs when people are purposely not given the same hiring, promotion, or membership opportunities because of their race, color, sex, age, ethnic group, national origin, or religious beliefs. A. Disparate treatment B. Adverse harassment C. The four-fifths rule D. Deliberate negative reinforcement E. Inequitable discrimination Answer: A Definition of disparate treatment. 7. Bruce Tulgan, a consultant on generational workplace issues, estimates that 3.5 million people between the ages of 40 and 58 vanished from the American workforce from 2001 to 2004. That’s about 5 percent of all baby boomers. Tulgan writes, “Older white-collar workers are quickly becoming disenfranchised through no fault of their own. They have difficulty getting back into the job market, and when they do, their compensation is often significantly reduced.” The disenfranchisement of baby boomers is an example of: A. bona fide discrimination B. disparate treatment C. sex selectivity D. quid pro quo selectivity E. hostile impact Answer: B Disparate treatment is intentional discrimination that occurs when people are purposely not given the same hiring, promotion, or membership opportunities because of their race, color, sex, age, ethnic group, national origin, or religious beliefs. 8. _____________ is unintentional discrimination that occurs when members of a particular race, sex, or ethnic group are unintentionally harmed or disadvantaged because they are hired, promoted, or trained (or any other employment decision) at substantially lower rates than others. A. Disparate treatment B. Adverse impact C. Bona fide discrimination D. Unsolicited discrimination E. Demographic discrimination Answer: B Definition of adverse impact. 9. While _____________ is a key part of determining disparate treatment, the courts and federal agencies use _____________ to determine if adverse impact has occurred. A. the four-fifths rule; motive B. environmental context; motive C. the 80-20 principle; environmental context D. workplace demographics; intention E. motive; the four-fifths rule Answer: E Motive is an element of disparate treatment, while the four-fifths rule is used to determine adverse impact. 10. Darlene Jespersen worked for nearly 20 years in a Harrah’s Casino sports bar. She was an outstanding employee, but she didn’t wear makeup because she felt it “took away her credibility” and interfered with her ability to be an effective bartender, which sometimes required her to deal with unruly, intoxicated guests. This changed when Harrah’s implemented a “beverage department image transformation” program. Female employees were told they would be fired if they did not wear makeup. Jespersen contended that it was an example of _____________ because male employees did not have to wear makeup. A. disparate treatment B. adverse harassment C. the four-fifths rule D. deliberate negative reinforcement E. inequitable discrimination Answer: A Disparate treatment is intentional discrimination that occurs when people are purposely not given the same hiring, promotion, or membership opportunities because of their race, color, sex, age, ethnic group, national origin, or religious beliefs. 11. The International Gay Rodeo Association (IGRA) began in 1976. By the end of the 1980s, gay rodeos were being held in more than a dozen states, and today there are 24 chapters that have raised millions for charity. But even the IGRA is not exempt from concerns about discrimination. To avoid claims of _____________, straights are allowed to participate in all IGRA events. A. bona fide discrimination B. disparate treatment C. sex selectivity D. quid pro quo selectivity E. hostile impact Answer: B Disparate treatment is intentional discrimination that occurs when people are purposely not given the same hiring, promotion, or membership opportunities because of their race, color, sex, age, ethnic group, national origin, or religious beliefs. 12. The _____________ is a rule of thumb used by the courts and the Equal Employment Opportunity Commission to determine whether there is evidence of adverse impact. A violation of this rule occurs when the selection rate for a protected group is less than a specified level of the selection rate for a nonprotected group. A. two-fifths rule B. 80 percent rule C. dysfunctional turnover rule D. disparate treatment rule E. principle of adverse impact Answer: B The 80 percent rule, also known as the four-fifths rule, is used to determine if adverse impact has occurred. 13. From a legal perspective, there are two kinds of sexual harassment. They are: A. quid pro quo and hostile work environment B. hostile work environment and bona fide C. adverse impact and bona fide D. quid pro quo and bona fide E. adverse impact and disparate treatment Answer: A From a legal perspective, quid pro quo and hostile work environment are the two kinds of sexual harassment. 14. When Sheila White, a forklift operator, was hired on the Burlington Northern Santa Fe Railway yard in Memphis, she had experience in that position and was the only woman in her maintenance division. Three months into her job, White complained that her foreman, who had never supervised a woman before, constantly made inappropriate remarks to her about her figure. White’s foreman was guilty of: A. an unwelcome sexual advance B. adverse impact discrimination C. demographic discrimination D. sexual harassment E. disparate treatment Answer: D Sexual harassment is a form of discrimination in which unwelcome verbal or physical conduct of a sexual nature occurs while performing one’s job. 15. When the CEO opened the nationwide salesforce meeting with a crude sexually explicit joke about Foreign Legion soldiers, it was an example of: A. an unwelcome sexual advance B. adverse impact discrimination C. demographic discrimination D. sexual harassment E. disparate treatment Answer: D Sexual harassment is a form of discrimination in which unwelcome verbal or physical conduct of a sexual nature occurs while performing one’s job. 16. _____________ is the form of sexual harassment in which employment outcomes, such as hiring, promotion, or simply keeping one’s job, depend on whether an individual submits to sexual harassment. A. Bona fide sexual harassment B. Quid pro quo sexual harassment C. Adverse impact sexual harassment D. Disparate sex treatment E. Hostile work environment sexual harassment Answer: B Definition of quid pro quo sexual harassment. 17. Which of the following statements about sexual harassment is true? A. Only people who have themselves been harassed can file complaints or lawsuits. B. Nonemployees cannot be guilty of sexual harassment. C. Sexual harassment can occur between people of the same sex. D. The three kinds of sexual harassment are quid pro quo, bona fide, and disparate treatment. E. None of these statements about sexual harassment is true. Answer: C Anyone who feels sexually harassed can file suit, including former employees. There are only two kinds of sexual harassment––quid pro quo and hostile work environment. 18. Former female employees of a national real estate brokerage firm claimed that they were subjected to lewd remarks, unwanted groping, and sexual propositions by male coworkers. According to their attorney, “The firm created a frat-house culture and then failed to do anything about it.” Their suit claims the women were victims of: A. disparate treatment B. a hostile work environment C. sex discrimination D. quid pro quo sexual harassment E. adverse treatment Answer: B A hostile work environment is a form of sexual harassment in which unwelcome and demeaning sexually related behavior creates an intimidating or offensive work environment. 19. To ensure that sexual harassment laws are followed and not violated, companies should: A. respond immediately when sexual harassment is reported B. write a clear, understandable, strongly worded policy that is well publicized within the company C. make sure they are acting in compliance with not only federal laws but also with local laws D. respect the privacy of the accused and the accusers E. do all of these Answer: E All of these statement reflect a company’s proper handling of sexual harassment claims. 20. A _____________ is a purposeful, systematic process for collecting information on the important work-related aspects of a job. A. job analysis B. task evaluation C. job specification D. job validation E. job description Answer: A Definition of job analysis. 21. In the 1990s, General Electric made an obsession of identifying its hottest up-and-comers at young ages. They were called high pots, for high potential, and fast-tracked up the corporate ladder, but the middle-aged managers who occupied rungs along their route were called blockers, and they had to be removed. In other words, GE relied on _____________ to fill its executive positions. A. internal recruiting B. job posting C. external recruiting D. downsizing E. restructuring Answer: A Internal recruiting is the process of developing a pool of qualified job applicants from people who already work in the company. 22. Bona fide occupational qualifications would be most likely included in a(n): A. job specification B. employee assignment list C. labor resource guide D. job description E. task inventory Answer: A A job specification is a written summary of the qualifications needed to successfully perform a particular job. 23. _____________ help companies meet the legal requirement that their human resource decisions be job related. A. Job analyses, task evaluations, and employee-needs assessment B. Job descriptions, external environments, and employee mapping C. Job specifications, job analyses, and job descriptions D. Job analyses, task specializations, and external environments E. Internal environments, external environments, and job descriptions Answer: C In addition, to be judged job related, recruitment, selection, training, performance appraisals, and employee separations must be valid and be directly related to the important aspects of the job as identified by a careful job analysis. 24. The National Board of Chiropractic Examiners recently announced that its 200-page Job Analysis of Chiropractic 2005 is available. You would expect this job analysis to contain: A. information regarding the tasks, professional responsibilities, and conditions that chiropractors see in their offices on a daily basis B. information about public opinion of chiropractics C. economic requirements for opening a chiropractic office D. type of patients seen in chiropractic offices E. all of these Answer: A Job analyses contain information about work activities, such as what workers do. 25. The United Kingdom issued a new recruitment publication for the nation’s Fire Service. The publication is entitled Start a New Life––Save Someone Else’s and lists all of the qualifications needed to become a firefighter. This recruitment pamphlet is actually a(n): A. job specification B. task inventory C. labor resource guide D. job description E. organizational chart Answer: A A job specification is a written summary of the qualifications needed to successfully perform a particular job. 26. Which of the following types of information would typically be collected as part of a job analysis? A. Work activities B. Tools and equipment used C. Knowledge, skills, and abilities needed to do the job D. Job context E. All of these Answer: E A job analysis typically collects all such information. 27. Before beginning to recruit, organizations must: A. advertise for job candidates B. create a job description C. conduct a job analysis D. create a job specification E. match salaries to industry averages Answer: C Because a job analysis specifies what a job entails as well as the knowledge, skills, and abilities that are needed to do the job well, companies must complete a job analysis before beginning to recruit job applicants. 28. In order to be considered _____________, recruitment, selection, training, performance appraisals, and employee separations must be valid and be directly related to the important aspects of the job and identified by a careful job analysis. A. employee related B. reliable C. concrete D. competitive E. job related Answer: E Even the U.S. Supreme Court has stated that companies should use job analyses to help establish the job relatedness of their human resource procedures. 29. Which of the following is an internal recruiting method? A. Advertising B. Job fairs C. Job posting D. Internet job sites E. Walk-ins Answer: C Job posting can be used for advertising job openings within the company to existing employees. 30. Which of the following is an internal recruiting method? A. Employee referrals B. Career paths C. Walk-ins D. Employment services E. Advertisements Answer: B A career path is a planned sequence of jobs through which employees may advance within an organization. 31. Which of the following is an external recruiting method? A. Advertising B. Career paths C. Job posting D. Needs-assessment implementations E. All of these Answer: A External recruitment methods include advertising, employees referrals, walk-ins, outside organizations, employment services, and Internet job sites. 32. Which of the following statements about Internet recruiting is true? A. Internet recruiting costs are considerably higher than traditional external recruiting methods. B. The Internet allows companies to quickly reach large numbers of people. C. The company will only receive applications from qualified people. D. There are no drawbacks to Internet recruiting. E. All of these are statements about Internet recruiting are true. Answer: B The Internet provides an inexpensive way to post detailed job openings. However, companies may receive hundreds, if not thousands, of applications from unqualified applicants. This is one of the primary drawbacks of Internet recruiting. 33. _____________ is the process of gathering information about job applicants to decide who should be offered a job. A. Job validation B. Pool enrichment C. Recruiting D. Selection E. Job inventorying Answer: D Definition of selection. 34. A study in the construction industry found that when equipment is stolen from building sites, 82 percent of the time the workers are the culprits. If background checks reduced employee thievery over a period of time and throughout the industry, then this selection process would be: A. validated B. EEOC certified C. legally authorized D. corroborated E. legally binding Answer: A Validation would determine how well the background check predicted actual job performance. 35. Which of the following statements about résumés and job application forms is true? A. Résumés and job application forms provide the employer with distinctly different information. B. It is nearly impossible to check the information provided on résumés. C. Employee-related laws apply to job application forms and résumés. D. Potential employees typically create résumés that honestly describe their work experiences. E. There is international agreement on what type of information can be gathered on job application forms. Answer: C Résumés and job application forms provide the employer with basically the same information. Information on résumés can be verified by managers and needs to be because résumés often contain untruthful information. There is no international agreement about what should be gathered on application forms. 36. Which of the following statements about validation is true? A. The Uniform Guidelines on Employee Selection Procedures recommend validation only for written tests used as selection procedures. B. Validation refers to the process of determining how well a selection test or procedure predicts future job performance. C. A test is said to be valid when it produces the same results every time it is used. D. In terms of recruitment, validation is most important in identifying what training prospective employees need. E. None of these statements about validation is true. Answer: B Both selection processes and procedures should be evaluated. A test is said to be reliable when it produces the same results every time it is used. A needs assessment identifies what training prospective employees need. 37. The first selection devices most job applicants encounter when they seek a job are: A. Internet sites and trade shows B. recruitment centers and Internet sites C. interviews and job application letters D. help wanted ads E. application forms and résumés Answer: E Application forms and résumés are selection devices that allow companies to gather information about job applicants in order to decide who should be offered a job. 38. _____________ are procedures used to verify the truthfulness and accuracy of information that applicants provide about themselves and to uncover negative, job-related background information not provided by applicants. A. Integrity checks B. Background checks C. Recruitment evaluation procedures D. Biographical data assessments E. Validation tests Answer: B Definition of background checks. 39. Which of the following is a legal problem employers may encounter in seeking, providing, or using employment references as part of the selection process? A. Defamation lawsuits B. Adverse impact lawsuits C. Product liability lawsuits D. Accusations of disparate discrimination E. Accusations of reciprocity Answer: A Employers are increasingly reluctant to provide references or background information for fear of being sued by previous employees for defamation. 40. A study in the construction industry found that when equipment is stolen from building sites, 82 percent of the time the workers are the culprits. From which type of selection information would employers in the construction industry receive the greatest benefit if their goal is to stop employee theft? A. Résumés B. Performance appraisals C. Job descriptions D. Background checks E. Connotative ability tests Answer: D Background checks could be used to uncover negative, job-related information about an applicant. 41. Estimates of losses in the HAZMAT driver workforce could vary from 2 percent to 20 percent as a result of new federal regulations requiring that all drivers be fingerprinted and those fingerprints checked to see if the driver has a criminal record. This new _____________ will cause a worsening problem for the already overextended workforce. A. integrity check B. background check C. recruitment evaluation procedure D. biographical data assessment E. validation test Answer: B Background checks are procedures used to verify the truthfulness and accuracy of information that applicants provide about themselves and to uncover negative, job-related background information not provided by applicants. 42. References Etc is a five-employee firm in Maine that, in exchange for a fee of roughly $80 to $90, will pose as a prospective employer, call a prior employer on an employee’s behalf, and find out what the former employer is saying. If the prior employer provides unsubstantiated negative information, then the job applicant: A. should not use the employee as a reference B. must not list references on the job application C. can sue for defamation D. must lie on the job application form E. must hire a human resource expert to check his or her résumés Answer: C To avoid being sued by previous employees for defamation, employers are increasingly reluctant to provide references or background information. 43. Which of the following questions is deemed acceptable (i.e., “legal”) for employers to ask applicants during the selection process? A. Are you a United States citizen? B. Have you ever filed a lawsuit against an employer? C. Have you ever been convicted of a crime? D. Do you smoke or use tobacco products? E. None of these Answer: C While applicants cannot be asked about their arrest records, they can be asked whether they have been convicted of a crime. See Exhibit 10.4. 44. According to the Americans with Disabilities Act, disabilities (and reasonable accommodations for them) should be discussed: A. as soon as the résumé has been accepted B. only after a job offer has been made C. during the employment interview D. in written request form, on the application blank, prior to the employment interview E. prior to the organization hiring its first employee Answer: B See Exhibit 10.4. 45. All job applicants for a position in an interior design company were given ten swatches of fabrics of different colors and textures, 30 different paint chips, and six different floor treatments and told to select the best fabric, paint, and floor treatment for an office that would also be used as a guest room. What type of selection test was used in this example? A. Biotesting B. Cognitive ability testing C. Environmental sensitivity testing D. Aptitude testing E. Personality testing Answer: D This test measured their aptitude for decorating a room. 46. Aptitude tests are also called: A. specific ability tests B. cognitive ability tests C. personality tests D. work sample tests E. job-related achievement tests Answer: A Specific ability tests measure the extent to which an applicant possesses the particular kind of ability needed to do a job well. They are also called aptitude tests because they measure aptitude for doing a particular task well. 47. Which of the following type of tests accurately predicts job performance in almost all kinds of jobs? A. Specific ability tests B. Cognitive ability tests C. Personality tests D. Achievement tests E. Work sample tests Answer: B Cognitive ability tests measure the extent to which applicants have abilities in perceptual speed, verbal comprehension, numerical aptitude, general reasoning, and spatial aptitude. 48. A perennial problem of teacher education programs is to select the highest-quality candidates and to deny admission to those unsuited to work in schools. One suggested method is to ask applicants a series of questions about their experiences with siblings, how they treat stress, their attitude toward procrastination, and ways they like to have fun. This method, which can use over 100 questions, gathers: A. background data B. validation material C. work situation assessments D. biodata E. information on affective skills Answer: D Biodata are extensive surveys that ask applicants questions about their personal backgrounds and life experiences. 49. When hiring employees for her spa and relaxation center, Hope Kharzov wants to hire people with strong empathy, a willingness to listen to others, and trustworthiness. What kind of selection tests would most likely reveal if a job applicant had these characteristics? A. Biodata B. Skills ability tests C. Cognitive ability tests D. Work sample tests E. Personality tests Answer: E Personality tests measure the extent to which applicants possess different kinds of job-related personality dimensions. 50. According to the text, if an employer were to use only one type of selection test, a(n) _____________ would be the one to use. A. achievement test B. personality test C. cognitive ability test D. work sample test E. biodata survey Answer: C Cognitive ability tests are almost always the best predictors of job performance. 51. Which of the following is a direct (rather than indirect) measure of job applicants’ capability to do the job? A. Creativity tests B. Cognitive ability tests C. Personality tests D. Achievement tests E. Work sample tests Answer: E Work sample tests, also called performance tests, require applicants to perform tasks that are actually done on the job. 52. The _____________ interview uses only standardized, job-related interview questions that are prepared ahead of time and asked of all candidates A. formalized B. structured C. semi-structured D. informal E. canned Answer: B In a structured interview, standardized interview questions are prepared ahead of time so that all applicants are asked the same job-related questions. 53. What is the primary advantage of the structured interview? A. The amount of background information it reveals B. Its ability to substitute for biodata C. All applicants are asked the same questions D. Its low costs E. Its validity Answer: C Since all applicants are asked the same questions, comparing applicants is much easier. 54. What type of job interview might be used after a background question revealed the applicant had spent three years working in Africa convincing parents to allow their children to take polio vaccine? A. Canned B. Semi-structured C. Tangential D. Creative E. Programmed Answer: B A major part of the semi-structured interview is based on structured questions, but some time is set aside for unstructured interviewing to allow the interviewer to prove into ambiguous or missing information uncovered during the structured portion of the interview. 55. _____________ means providing opportunities for employees to develop the job-specific skills, experience, and knowledge they need to do their jobs or improve their performance. A. Supervising B. Directing C. Training D. Mentoring E. Mediating Answer: C Definition of training. 56. _____________ interviewing typically leads to much more accurate hiring decisions (i.e., correctly predicting which job applicants will perform better and therefore should be hired). A. Structured B. Unstructured C. Scripted D. Formalized E. Scenario Answer: A While unstructured interviews do predict job performance with some success, they are about half as accurate as structured interviews as predicting which job applicants should be hired. 57. Which of the following training methods is most appropriate for imparting information or knowledge to trainees? A. Group discussions B. Lectures and planned readings C. Role-playing D. Case studies E. Coaching and mentoring Answer: B If the training objective is to impart information or knowledge to trainees, then films and videos, lectures, and planned readings should be used. 58. Which of the following training methods is most appropriate when the objective of training is practicing, learning, or changing behaviors? A. Group discussions B. Planned readings and lectures C. Role-playing D. Case studies E. Films and videos Answer: C Also appropriate are on-the-job training, simulations and games, and vestibule training. 59. One of the disadvantages associated with Internet training is: A. its increased popularity B. how it increases employee stress C. how it decreases workplace productivity D. how it increases travel costs E. the cost of equipment and technology Answer: E Internet training, or e-learning, requires a significant investment in computers and high-speed Internet connections for all employees. 60. Which of the following is one of the ways in which training can be evaluated? A. By reactions of employees B. By how much employees learned C. By how much employees actually modified their on-the- job behavior D. By how job performance improved E. All of these Answer: E All of these are ways in which training can be evaluated. 61. Which of the following is a common type of rating error that managers are prone to in the performance appraisal process? A. Standard deviation B. Descriptive bias error C. 80/20 error D. Central tendency error E. All of these Answer: D The three most common rating errors when rating worker performance are central tendency, halo, and leniency. 62. What type of error did the manager use when she rated all of her subordinates as above average in all performance areas? A. Central tendency error B. Validity error C. Leniency error D. Halo error E. Superlative error Answer: C Leniency errors occur when assessors rate all workers as performing particularly well. 63. Which of the following statements about performance appraisal is true? A. Most employees and managers intensely dislike the performance appraisal process. B. Performance appraisals can be used as a basis for compensation but not as a basis for determining who needs further training. C. Since performance appraisal is only a marginally important human resource process, any problems associated with it do not affect the organizations overall. D. Legally, a disgruntled employee cannot sue an employer on the basis of a dissatisfactory performance appraisal. E. All of these statements about performance appraisal are true. Answer: A Performance appraisals can be used as a basis for determining who needs further training. Companies with poor performance appraisals face tremendous problems. Legally, a disgruntled employee can sue an employer on the basis of a dissatisfactory performance appraisal. 64. Which of the following is an example of a subjective performance measure? A. Behavior observation scales B. Sales quotas C. Production rate D. Revenues E. Number of customer complaints Answer: A See Exhibit 10.7 65. _____________ ask raters to rate the frequency with which workers perform specific behaviors representative of the job dimensions that are critical to successful job performance. A. Behavior observation scales B. Observational research studies C. Performance rating scales D. Objective performance measures E. Trait rating scales Answer: A Definition of the behavior observation scale. 66. Which of the following is an example of an objective performance measure? A. Performance analyses B. Behavior observation scales C. Cognitive ability scales D. Output measures E. All of these Answer: D An objective performance measure is a measure of job performance that is easily and directly counted or quantified. Other examples include scrap, waste, sales, customer complaints, and rejection rates. 67. _____________ is a performance appraisal process in which feedback is obtained from the boss, subordinates, peers and coworkers, and the employees themselves. A. 360-degree feedback B. Performance appraisal iteration C. Reciprocal appraisal D. Grapevine appraisal E. A circular feedback program Answer: A Definition of 360-degree feedback. 68. To improve traditional performance appraisal feedback sessions, it is recommended that managers: A. combine developmental feedback and administrative feedback B. strengthen the grading aspect of performance appraisal C. base performance appraisal feedback sessions on self-appraisals D. use outsourcing E. use either a halo or a recency measure Answer: C Self-appraisals, in which employees carefully assess their own strengths, weaknesses, successes, and failures in writing, have been shown to be beneficial for both employees and managers. 69. Which of the following statements about 360-degree feedback is true? A. 360-degree feedback is most effective when used to train performance raters. B. 360-degree feedback provides feedback from peer workers only. C. With the 360-degree feedback approach, feedback comes from four sources. D. Employees do not provide feedback about their own efforts in the 360-degree feedback approach. E. 360-degree feedback should not be used for developmental purposes. Answer: C The four sources are the boss, subordinates, peers and coworkers, and the employees themselves. Self-rating is used in 360-degree feedback. It is more commonly used for developmental purposes than for any other purpose. 360-degree feedback was not designed to train performance raters. 70. The four basic kinds of compensation decisions are pay level, pay structure, pay variability, and: A. severance package B. worker satisfaction C. Employee Assistant Planning (EAP) programs D. pay discharge E. employment benefits Answer: E These are the four basic kinds of compensation decisions. 71. _____________ determine the worth of each job by determining the market value of the knowledge, skills, and requirements needed to perform it. A. Work performance scales B. Job evaluations C. Job analyses D. Pay variability charts E. Hierarchical pay structures Answer: B Definition of job evaluation. 72. The term _____________ refers to both the financial and nonfinancial rewards that organizations give employees in exchange for their work. A. wages B. value-added C. compensation D. salaries E. fees Answer: C Definition of compensation. 73. Which of the following is NOT an example of a pay-variability decision used to motivate employee performance? A. Piecework pay B. Hierarchical pay C. Sales commissions D. Stock options E. Profit sharing Answer: B Piecework, sales commissions, profit sharing, employee stock ownership plans, and stock options are common pay-variability options. 74. Continental Airlines said in January 2005 that it will share with employees 30 percent of the first $250 million in pre-tax income, 25 percent of the next $250 million, and 20 percent of amounts exceeding $500 million. Under the previous _____________ program, Continental distributed among employees 15 percent of pre-tax income. A. piecework pay B. hierarchical pay C. sales commission D. payroll deduction E. profit sharing Answer: E Profit sharing is a compensation system in which a company pays a percentage of its profits to employees in addition to their regular compensation. 75. An ESOP is an: A. equitable stock ownership plan B. employee stock ownership plan C. employee salary option program D. equity in salary organizational plan E. employer/subordinate organizational profit Answer: B ESOP is an acronym for employee stock ownership plan. 76. One of the reasons items manufactured in Southeast Asia can be imported into the United States so cheaply is that workers are paid a small amount of money for each item produced. The manufacturers operating in Southeast Asia use what type of pay plan? A. Real-time pay B. Compressed pay C. Piecework D. Batch processing E. Commission Answer: C Piecework is a compensation system in which employees are paid a set rate for each item they produce. 77. Which of the following is a method of rewarding employees that includes virtually any kind of compensation other than wages or salaries? A. Cafeteria benefit plans B. Employment benefits C. A combination compensation plan D. Piecework benefits E. A drawing account Answer: B Definition of employment benefits. 78. Flexible benefit plans: A. are also referred to as piecework plans B. make organizations less attractive to job applicants C. decrease the chances that employees will stay with companies D. are inexpensive to administer E. are also referred to as cafeteria benefit plans Answer: E Flexible benefit plans, or cafeteria benefit plans, are plans that allow employees to choose which benefits they receive, up to a certain dollar value. 79. Which of the following statements about employee separations is true? A. Employee separations may be voluntary or involuntary. B. Examples of employee separation would include terminations, downsizing, retirements, and turnover. C. Wrongful discharge is a legal doctrine that requires employers to have a job-related reason for terminating an employee. D. Outplacement services provide employment-counseling services for employees faced with downsizing. E. All of these statements about employee separation are true. Answer: E All of these statements is true with regard to employee separations. 80. To minimize the problems inherent in firing employees, managers should do which of the following? A. Before firing employees, managers should give them a chance to improve. B. Employees should be fired if they develop a health problem that will put an unforeseen burden on the company’s insurance carrier. C. Employees should never be fired in private. D. While written records are not necessary, managers should be sure to verbally report the reason for the firing to the human resource department. E. None of these statements describes what a manager should do to minimize the problems inherent in firing employees. Answer: A In most situations, firing should not be the first option. Instead, employees should be given a chance to change their behavior. 81. Sharron Grant-Burton was a marketing director for Covenant Care, an owner of skilled-nursing and assisted-living facilities. During a discussion of the fairness of the company’s bonus structure with other marketing directors, Grant-Burton said she did not receive a bonus because her executive director “did not believe in them.” Several days later, Grant-Burton was fired and told she had been terminated for a number of unspecified reasons, including her comments about bonuses. This is an example of a: A. de-employment B. wrongful discharge C. reactive termination D. regressive turnover E. proactive termination Answer: B A wrongful discharge occurs when the employer terminates an employee without having a job-related reason. 82. Which of the following statements regarding downsizing is true? A. Downsizing refers to the revaluation or splitting of the organization’s common stock. B. Downsizing typically leads to increased employee morale. C. When downsizing, companies should use outplacement programs that provide employment counseling for people faced with downsizing. D. The best strategy for downsizing is to establish a tall organizational structure as quickly as possible. E. Downsizing is seldom a planned strategy; it typically evolves as a result of environmental changes. Answer: C Downsizing is the planned elimination of jobs in a company. It typically decimates employee morale. Downsizing typically results in flatter organizational structures. 83. In July 2006, money.CNN.com reported, in a segment called, “101 Dumbest Moments in Business,” that Northwest Airlines conducted a planned elimination of thousands of jobs, but not before issuing the employees a handy guide, 101 Ways to Save Money. The advice includes dumpster diving (“Don’t be shy about pulling something you like out of the trash”), making your own baby food, shredding old newspapers for use as cat litter, and taking walks in the woods as a low-cost dating alternative. Northwest Airlines engaged in: A. disparate treatment B. downsizing C. employee acculturation D. recruitment socialization E. adverse treatment Answer: B Downsizing is the planned elimination of jobs in a company. 84. Which of the following provides employment counseling services for employees faced with downsizing? A. Outplacement services B. Reassessment centers C. Employee outsourcing D. Employee restructuring services E. Outsourced centers Answer: A Outplacement services often include advice and training in preparing résumés, getting ready for job interviews, and even identifying job opportunities in other companies. 85. Which of the following statements about employee turnover is true? A. For top management, dysfunctional turnover is preferable to functional turnover. B. One of the best ways to discourage turnover is to link pay directly to performance. C. Employee turnover is the loss of employees who involuntarily choose to leave a company. D. Functional turnover requires outplacement centers. E. Sales commissions and bonuses should not be used to decrease employee turnover. Answer: B Dysfunctional turnover is the loss of high performers who voluntarily choose to leave a company. Employee turnover includes employees who leave voluntarily and those who leave involuntarily. Downsizing requires outplacement centers. Sales commissions and bonuses can be offered to prevent or reduce dysfunctional turnover. 86. _____________ is the loss of high-performing employees who voluntarily choose to leave a company. A. De-employment B. Dysfunctional turnover C. Reactive turnover D. Regressive turnover E. A “brain leak” Answer: B Definition of dysfunctional turnover. 87. Refer to “What Would You Do?” Which of the following may Burgerville ask applicants for on its application forms? A. age B. arrest records C. disabilities D. name Answer: D See Exhibit 10.4 for topics to avoid. 88. Refer to “What Would You Do?” The annual sessions Burgerville conducts to teach the best way to slice onions, coat them in batter, season, and fry them to make its onion rings is part of __________ its employees. A. recruiting B. selecting C. training D. appraising Answer: C 89. Refer to “What Would You Do?” The compensation received by Burgerville employees is composed of: A. health benefits B. salary and benefits C. salary D. neither salary nor benefits Answer: B SHORT ANSWER 1. Identify the employee characteristics that are protected by federal employment antidiscrimination laws (i.e., the characteristics upon which employers are not legally allowed to discriminate). Specify which human resource management decisions these laws affect. Answer: According to federal employment law, employers may not discriminate in employment decisions on the basis of sex, age, religion, color, national origin, race, or disability. The intent is to make these factors irrelevant in employment decisions. These laws govern the entire human resource management process, including selection decisions (i.e., hiring and promotion), as well as all training and development activities, performance appraisals, terminations, and compensation decisions. 2. Briefly identify the Equal Employment Opportunity Commission’s definition of sexual harassment. Also identify and describe the two kinds of sexual harassment that can be specified from a legal perspective. Answer: According to the EEOC, sexual harassment is a form of discrimination in which unwelcome sexual advances, requests for sexual favors, or other verbal or physical conduct of a sexual nature occurs while performing one’s job. From a legal perspective, the two kinds of sexual harassment are quid pro quo and hostile work environment. Quid pro quo sexual harassment occurs when employment outcomes, such as hiring, promotion, or simply keeping one’s job, depend on whether an individual submits to being sexually harassed. By contrast, a hostile work environment occurs when unwelcome and demeaning sexually related behavior creates an intimidating, hostile, and offensive work environment. 3. Explain how job analysis is related to recruiting. Be sure to specify how it helps an organization to meet a basic legal requirement for human resource management. Answer: Recruiting is the process of developing a pool of qualified job applicants. The first step in recruiting is to conduct a job analysis to collect information about the important work-related aspects of the job. The job analysis is then used to write a job description of basic tasks, duties, and responsibilities and to write job specifications indicating the knowledge, skills, and abilities needed to perform the job. Job analyses, descriptions, and specifications help companies meet the legal requirement that their human resource decisions be job related. 4. Differentiate between internal and external recruiting. Provide two examples of each. Answer: Recruiting is the process of finding qualified job applicants. Internal recruiting, or finding qualified job applicants from inside the company, can be done through job posting and career paths. External recruiting, or finding qualified job applicants from outside the company, is done through advertising, employee referrals, walk-ins, outside organizations, employment services, special events, and Internet job sites. 5. Explain how a human resource department defines selection. List the four common categories of selection procedures used by companies. Specify which of these four generally does the best job of predicting applicants’ future job performance. Answer: Selection is the process of gathering information about job applicants to decide who should be offered a job. The common selection procedures used by companies are (1) application forms and résumés, (2) references and background checks, (3) selection tests, and (4) interviews. Selection tests generally do the best job of predicting applicants’ future job performance. 6. Identify and describe the three kinds of job interviews. Which type works best as a selection tool? Answer: In job interviews, company representatives ask applicants job-related questions to determine whether they are qualified for the job. There are several basic kinds of interviews: unstructured, structured, and semi-structured. In unstructured interviews, interviewers are free to ask applicants anything they want, and studies show that they do. By contrast, with structured interviews, standardized interview questions are prepared ahead of time so that all applicants are asked the same job-related questions. Semi-structured interviews lie somewhere in between structured and unstructured interviews, with as much as 80 percent of the interview based upon structured questions and the remaining time left unstructured. Of these three types of interviews, structured interviews work best, because they ensure that all applicants are consistently asked the same situational, behavioral, background, or job-knowledge questions. 7. Identify two common problems that occur during the performance appraisal process. Recommend one approach for avoiding each of these problems. Answer: Some of the problems associated with appraisals can be avoided by (1) accurately measuring job performance and (2) effectively sharing performance feedback with employees. Managers are prone to three kinds of rating errors: central tendency, halo, and leniency error, which pose a challenge to the accurate measurement of job performance. One way to minimize rating errors is to use better appraisal measures, such as objective measures of performance or behavior observation scales. Another method is to directly train performance raters to minimize errors and more accurately rate the important dimensions of job performance. One way to overcome the inherent difficulties in performance appraisal feedback is to provide 360-degree feedback, in which feedback is obtained from four sources: the boss, subordinates, peers and coworkers, and the employees themselves. Feedback tends to be more credible if heard from several sources. Traditional performance appraisal feedback sessions can be improved by separating developmental and administrative feedback, by basing feedback discussions on employee self-appraisals, and, especially for managers, by having people discuss the feedback they received with executive coaches or the people who provided it. 8. List and briefly define the four basic kinds of compensation decisions. Answer: There are four basic kinds of compensation decisions: pay level, pay variability, pay structure, and employment benefits. Pay-level decisions are decisions about whether to pay workers at a level that is below, above, or at current market wages. Pay-variability decisions are decisions concerning the extent to which employees’ pay varies with individual and organizational performance. Pay-structure decisions are concerned with internal pay distributions, meaning the extent to which people in the company receive very different levels of pay. Employment benefits include virtually any kind of compensation other than direct wages paid to employees. 9. Identify three things that managers can do to minimize the problems inherent in terminating employees. Answer: Getting fired is a terrible thing, but many managers make it even worse by bungling the firing process, needlessly provoking the people who were fired, and unintentionally inviting lawsuits. This is a potentially serious problem for employers, since former employees win 68 percent of wrongful discharge cases. There are several things managers can do to minimize the problems inherent in firing employees. First, in most firing situations, firing should not be the first option. Instead, employees should be warned and given sufficient time to change their behavior. Second, employees should be fired only for a good reason. That is, termination decisions should be made on the basis of job-related factors, such as violating company rules or consistently poor performance. For legal protection, managers should record the job-related reasons for the termination, document specific instances of rule violations or continued poor performance, and keep notes and documents from the counseling sessions held with employees. Finally, to reduce the chances of a wrongful discharge suit, employees should always be fired in private, behind closed doors, and not in the presence of others. ESSAY 1. Explain the nature and intent of federal employment law. Identify the circumstances under which protected characteristics such as sex, age, or religion can be used as the basis for employment decisions as well as the circumstances under which a company may be found guilty of illegal discrimination. Answer: Human resource management is subject to the following major federal employment laws: Equal Pay Act, Civil Rights Acts of 1964 and 1991, Age Discrimination in Employment Act, Pregnancy Discrimination Act, Americans with Disabilities Act, Family and Medical Leave Act, and Uniformed Services Employment and Reemployment Rights Act. It is important to understand that these laws govern the entire human resource management process, including selection decisions (i.e., hiring and promotion), as well as all training and development activities, performance appraisals, terminations, and compensation decisions. The general result of this body of law, which is still evolving through court decisions, is that employers may not discriminate in employment decisions on the basis of sex, age, religion, color, national origin, race, or disability. The intent is to make these factors irrelevant in employment decisions. Stated another way, employment decisions should be based on factors that are “job related,” “reasonably necessary,” or a “business necessity” for successful job performance. The only time that sex, age, religion, and the like can be used to make employment decisions is when they are considered a bona fide occupational qualification (BFOQ). Title VII of the 1964 Civil Rights Act says that it is lawful to hire and employ someone on the basis of their sex, religion, or national origin when there is a BFOQ that is “reasonably necessary to the normal operation of that particular business.” However, the courts and the Equal Employment Opportunity Commission (EEOC) take a hard look when a business claims that sex, age, religion, color, national origin, race, or disability are BFOQs. Except for the Department of Labor, which administers the Family and Medical Leave Act and the Uniformed Services Employment and Reemployment Rights Act, all of these laws are administered by the EEOC. Employers who use sex, age, race, or religion to make employment-related decisions when those factors are unrelated to an applicant’s or employee’s ability to perform a job may face charges of discrimination from the EEOC. The EEOC has investigatory, enforcement, and informational responsibilities. Therefore, it investigates charges of discrimination, enforces the provisions of these laws in federal court, and publishes guidelines that organizations can use to ensure they are in compliance with the law. The Uniform Guidelines on Employee Selection Procedures define two important criteria, disparate treatment (intentional discrimination) and adverse impact (unintentional discrimination), that are used to decide whether companies have wrongly discriminated against someone. While motive is a key part of determining disparate treatment, the courts and federal enforcement agencies use the four-fifths rule to determine if adverse impact has occurred. This rule specifies that the selection rate for a protected group must be at least 80% or four-fifths of the selection rate for a nonprotected group. 2. What is sexual harassment? Identify the two kinds of sexual harassment from a legal perspective. Describe some frequent misunderstandings about sexual harassment, and specify steps that companies can take to make sure that sexual harassment laws are followed and not violated. Give one example of possible sexual harassment that you have heard or read about, and explain which of the steps just described could have averted or resolved that situation more effectively. Answer: According to the Equal Opportunity Employment Commission, sexual harassment is a form of discrimination in which unwelcome sexual advances, requests for sexual favors, or other verbal or physical conduct of a sexual nature occur. From a legal perspective, there are two kinds of sexual harassment, quid pro quo and hostile work environment. Quid pro quo sexual harassment occurs when employment outcomes, such as hiring, promotion, or simply keeping one’s job, depend on whether an individual submits to being sexually harassed. By contrast, a hostile work environment occurs when unwelcome and demeaning sexually related behavior creates an intimidating, hostile, and offensive work environment. Managers often wrongly assume (1) that the victim and harasser must be of the opposite sex (they do not; according to the courts, sexual harassment can occur between people of the same sex), (2) that sexual harassment can only occur between coworkers or between supervisors and their employees (it can also include agents of employers, such as consultants, or even nonemployees; the key is whether the harassment occurs while conducting company business), and (3) that only people who have themselves been harassed can file complaints or lawsuits (in fact, especially in hostile work environments, anyone affected by offensive conduct can file a complaint or lawsuit). To make sure that sexual harassment laws are followed, companies should (1) respond immediately when harassment is reported, (2) write a clear, understandable, strongly worded sexual harassment policy that gives specific examples of what constitutes sexual harassment and is widely publicized within the company, (3) establish clear reporting procedures that ensure a quick response by impartial parties who will protect the privacy of both the accused and accuser, and (4) be aware of and follow city and state laws concerning sexual harassment in addition to federal law. Student examples of potential harassment will typically cover the gamut from mild to extreme. Better answers will specify one of the two legal definitions of harassment for the situation and will clearly articulate steps from the recommended list that could have been taken to avert or resolve the situation more effectively. 3. What makes an effective selection process? What are the steps in the common selection procedures used by companies? Which of these procedures would you recommend that a company use to hire managers? Explain the reasons for your recommendations. Answer: Selection is the process of gathering information about job applicants to decide who should be offered a job. The common selection procedures used by companies are (1) application forms and résumés, (2) references and background checks, (3) selection tests, and (4) interviews. Accurate selection procedures have three characteristics. First, they are valid (i.e., they accurately predict the future job performance of the applicants who are hired). Second, they are legally defendable (i.e., do not violate federal, state, or local law). Third, they improve organizational performance (by hiring the individuals from the applicant pool who are likely to perform best and not hiring individuals who are likely to perform poorly). Application forms and résumés are the most common selection devices. Because many application forms request illegal, non-job-related information, and because as many as one third of job applicants falsify information on résumés, these procedures can sometimes be of little value when making hiring decisions. References and background checks can also be problematic, given that previous employers are reluctant to provide such information for fear of being sued for defamation. Unfortunately, the lack of this information puts other employers at risk of negligent hiring lawsuits. Selection tests generally do the best job of predicting applicants’ future job performance. In general, cognitive ability tests, work sample tests, biographical data, and assessment centers are the most valid tests, followed by personality tests and specific ability tests, which are still good predictors. Selection tests aren’t perfect predictors of job performance, but almost nothing predicts future job performance as well as selection tests. The three kinds of job interviews are unstructured, structured, and semi-structured interviews. Of these, structured interviews work best, because they ensure that all applicants are consistently asked the same situational, behavioral, background, or job-knowledge questions. For hiring managers, it would be appropriate to minimally recommend the use of (1) application forms and résumés (for screening the applicant pool), (2) references and background checks (for verifying credentials and previous performance, and weeding out potential problem employees), and (3) structured interviews (to assess the interpersonal skills that are crucial to a managerial job). Better answers will identify specific types of selection tests that would be of additional value in screening out potentially poor performers and identifying potentially good performers. Such tests would include (4) assessment centers (which are designed to select managers and have a 69 percent probability of success in separating good and poor performers), (5) cognitive ability tests (since people with strong cognitive or mental abilities are usually good at learning new things, processing complex information, and solving problems and making decisions, all of which are important in managerial work), and perhaps (6) a personality test for conscientiousness (to assess the degree to which an individual is organized, hardworking, responsible, persevering, thorough, and achievement oriented). Since the data from meta-analyses clearly indicates that a combination of procedures tends to have stronger predictive power than a single procedure, better student answers will identify an appropriate set of multiple selection procedures within the context of any additional assumptions necessary to support choices of procedures beyond those described above. 4. What is a performance appraisal? How does it influence organizational success? Explain why it poses a particular challenge to managers. Answer: Performance appraisal is the process of assessing how well employees are doing their jobs. Since organizational performance (and thereby success) is ultimately dependent upon employee performance, the performance appraisal process, which is designed to manage and maintain employee performance at acceptable to high levels, is crucial to organizational success. Performance appraisal is used for a variety of crucial purposes within organizations. For example, performance appraisals are used as a basis for compensation, promotion, and training decisions. In human resource planning, performance appraisals are used for career planning and for making termination decisions. As a direct result of their key role in so many organizational decisions, performance appraisals are central to many of the lawsuits that employees (or former employees) file against employers. It is obvious then, that due to the crucial importance of performance appraisal in so many areas, companies with poor performance appraisal systems face tremendous problems. Performance appraisal poses a particular challenge to managers due to the typical reactions of both managers and employees to the process. Most employees and managers intensely dislike the performance appraisal process. In fact, seven out of ten employees are dissatisfied with the performance appraisal process in their companies. Likewise, according to a survey, 90 percent of human resource managers are dissatisfied with the performance appraisal systems used by their companies. Thus, the challenge for managers lies in having responsibility for performing this difficult (but crucially important) task, which must be performed appropriately in order to ensure organizational success, while both employees and managers intensely dislike and dread engaging in this very task. 5. List and explain the four basic kinds of compensation decisions. Give two examples of what is involved in making each kind of compensation decision. What is a job evaluation? To which kind(s) of compensation decisions are job evaluations directly related? Answer: There are four basic kinds of compensation decisions: pay level, pay variability, pay structure, and employment benefits. Pay-level decisions are decisions about whether to pay workers at a level that is below, above, or at current market wages. Some companies choose to pay above-average wages to attract and keep employees. Above-market wages can attract a larger and more qualified pool of job applicants, increase the rate of job acceptance, decrease the time it takes to fill positions, and increase how long employees stay. Pay-variability decisions are decisions concerning the extent to which employees’ pay varies with individual and organizational performance. Linking pay to organizational performance is intended to increase employee motivation, effort, and job performance. Piecework, sales commission, profit sharing, employee stock ownership plans, and stock options are common pay-variability options. Pay-structure decisions are concerned with internal pay distributions, meaning the extent to which people in the company receive very different levels of pay. With hierarchical pay structures, there are big differences from one pay level to another. By contrast, with compressed pay structures, there are typically fewer pay levels and smaller differences in pay between pay levels. Pay is less dispersed and more similar across jobs in the company. Employment benefits include virtually any kind of compensation other than direct wages paid to employees. Three employee benefits are mandated by law: Social Security, workers’ compensation, and unemployment insurance. However, to attract and retain a good workforce, most organizations offer a wide variety of benefits, including retirement plans and pensions, paid holidays, paid vacations, sick leave, health insurance, life insurance, dental care, eye care, daycare facilities, paid personal days, legal assistance, physical fitness facilities, educational assistance, and discounts on company products and services. As stated in the text, companies use job evaluation to set their pay structures. Job evaluation determines the worth of each job by determining the market value of the knowledge, skills, and requirements needed to perform it. After conducting a job evaluation, most companies try to pay the “going rate,” meaning the current market wage. Thus, as explained in the text, job evaluation is clearly related to pay-level decisions in this context. However, students who are thinking critically will realize that job evaluation is also used for pay-structure decisions, which are concerned with internal pay distributions, or the extent to which people in the company receive very different levels of pay. Depending upon where a job is evaluated in comparison to all other jobs in the company, it will tend to be paid more or less (in addition to the preceding decision regarding market value). Test Bank for Effective Management Chuck Williams 9781285866246
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