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C1 Questions and Answers

Question # 1

The Delta Company has experienced increased turnover in the past two years. Data from exit interviews indicate that most of those leaving did so for better opportunities and higher compensation. If Delta pays at the highest percentile of the market for their peer group, what data analysis should they do?

A.

Additional quantitative analysis to determine whether pay rates are truly competitive or existing data are unreliable

B.

Qualitative data collection to talk to key stakeholders and employees and determine whether the exit interviews accurately reflect their concerns

C.

Qualitative data collection in the form of an employee survey with questions about employee satisfaction with pay levels

D.

No additional data analysis is needed. Delta should increase pay rates based on the existing data to decrease turnover.

Question # 2

When would an employee most likely receive a differential in addition to the regular hourly rate?

A.

When working in more than one department

B.

When working less time than his or her normal schedule

C.

When working in locations other than the corporate office

D.

When working a holiday or weekend   

Question # 3

Your company has had a strong fiscal year with a 15% increase in net income over the prior fiscal year. Share prices are at an all time high. Working with Finance, you have arrived at a 2.5% merit increase budget for the next fiscal year, a smaller increase than the last fiscal year. Finance has indicated that some large capital expenditures will be needed next year, so the company needs to conserve resources. Additionally, Legal is in final negotiations on a lawsuit that may be very costly to the company. Word of the smaller increases has line management concerned that they will lose their best performers. Given all of these factors, what is your best course of action?

A.

Implement the merit increase budget as is because the anticipated financial obligations have made it necessary

B.

Meet with Finance and make a case for a larger merit increase budget because the loss of key talent will cost more over the long term than the savings from the smaller merit increases

C.

Gather the perspectives of all stakeholders, analyze their individual concerns and meet to determine whether a compromise solution is possible

D.

Recommend a reduction in force to eliminate poor performers, which will increase the merit budget by reducing headcount

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