Total rewards on the PHR, pay law and benefits

Throughout the prior calendar year, an employer had 40 full-time employees and 30 part-time employees who each worked 60 hours per month. Is it an applicable large employer (ALE) under the ACA this year?

1. Yes; 40 full-time plus 15 FTEs makes 55
   Part-time hours convert to FTEs: 30 × 60 = 1,800 hours ÷ 120 = 15 FTEs, and 40 + 15 = 55, which meets the 50-employee ALE threshold.
2. No; part-time staff count only at 30 hours a week
   Part-time employees still count as FTEs for ALE status, even though they are not full-time employees.
3. No; only the 40 full-time employees count
   The ALE count adds full-time equivalents from part-time hours, so leaving them out undercounts the workforce.
4. Yes; it has 70 employees on its payroll
   The ALE count is not raw headcount; part-time staff count as fractions (FTEs), not as whole employees.

To compete for talent, a company raised starting pay for new technicians to $24 per hour, while technicians with five years of service earn $25 per hour. Which pay problem has HR created?

1. Green-circle rates
   A green-circle rate is pay below the range minimum, not new hires catching up to tenured staff.
2. Pay compression
   Pay compression is when newer employees' pay nears or overtakes that of experienced staff, as $24 vs $25 does here.
3. Broadbanding
   Broadbanding collapses many grades into a few wide bands; it is a structure, not this problem.
4. Red-circle rates
   A red-circle rate is pay above the range maximum for a job, which is not what happened here.

A server is paid a $2.13 cash wage and works 30 hours in a workweek, receiving $120 in tips. How much more must the employer pay for that week under federal law?

1. $153.60
   $153.60 is the full tip credit ($217.50 − $63.90); the server's $120 in tips covers most of it.
2. $0.00
   The cash wage plus tips falls short of $217.50, so the employer cannot pay nothing more.
3. $33.60
   The $7.25 minimum for 30 hours is $217.50; the cash wage ($63.90) plus tips ($120) is $183.90, so the employer owes $33.60 more.
4. $217.50
   $217.50 is the total minimum wage for the week, not the additional amount owed.

A nonexempt employee earns $20 per hour, works 45 hours in a workweek and receives a $90 nondiscretionary production bonus for that week. What is the employee's total pay for the week?

1. $990
   $990 is straight-time pay plus the bonus, with no overtime premium for the 5 extra hours.
2. $1,040
   $1,040 adds a premium of $50 based on the $20 base rate, leaving the bonus out of the regular rate.
3. $1,055
   $1,055 overstates the premium; the half-time premium on a $22 regular rate for 5 hours is $55, not $65.
4. $1,045
   Regular rate is ($900 + $90) ÷ 45 = $22; the overtime premium is 0.5 × $22 × 5 = $55, so the total is $900 + $90 + $55 = $1,045.

A 600-employee company is moving its health plan from fully insured to self-funded. Which arrangement protects the company against catastrophic claims?

1. Stop-loss insurance
   Stop-loss coverage caps the self-funded employer's exposure when individual or total claims exceed set limits.
2. A health savings account
   An HSA is an employee savings account paired with a high-deductible plan, not employer catastrophic protection.
3. Community rating
   Community rating is an insurer's premium-setting method, not protection for a self-funded plan.
4. COBRA continuation
   COBRA continues coverage for people who lose it; it does not shield the employer from large claims.

An exempt employee with no paid leave left takes a half day off for personal reasons. Under the FLSA salary-basis rules, may the employer deduct that half day from the employee's salary?

1. No; exempt salaries can never be reduced at all
   Exempt salaries can be reduced in limited cases, such as full-day personal absences, so 'never' is too broad.
2. No; personal-absence deductions must be in full days
   Salary-basis rules allow deductions for personal absences only in full-day units, so a half-day absence cannot be docked.
3. Yes; pay may be prorated for any hours missed
   Prorating for any hours missed would turn the salary into hourly pay and put the exemption at risk.
4. Yes; if company policy allows partial-day deductions
   Company policy cannot override the FLSA's full-day rule for personal-absence deductions.

An employee's son, an active-duty service member, suffers a serious injury in the line of duty. How much FMLA leave may the eligible employee take in a single 12-month period to care for him?

1. 52 weeks
   52 weeks is twice the actual caregiver maximum of 26 workweeks.
2. 24 weeks
   24 weeks does not match any FMLA entitlement; the caregiver maximum is 26.
3. 26 weeks
   Military caregiver leave allows up to 26 workweeks in a single 12-month period to care for a covered servicemember with a serious injury.
4. 12 weeks
   12 weeks is the standard FMLA entitlement; caring for a seriously injured servicemember allows more.

Health plan costs rose 12% this year. HR wants to slow cost growth while encouraging employees to compare prices for care. Which strategy BEST fits?

1. Add a high-deductible plan paired with an HSA
   A high-deductible plan with an HSA makes employees pay more of the first costs, which encourages price comparison and slows premium growth.
2. Drop coverage and pay the ACA employer penalty
   Dropping coverage triggers ACA penalties and hurts recruiting, so it does not slow costs sensibly.
3. Add a second low-deductible PPO option
   Another low-deductible PPO shields employees from prices and tends to raise costs.
4. Pay 100% of every employee's premium
   Paying the whole premium raises employer cost and removes any reason to shop for care.

An employee's child is unexpectedly hospitalized overnight. Under the FMLA, when must the employee notify the employer of the need for leave?

1. Only after the leave ends, with certification
   Waiting until the leave ends is too late; certification is a separate step from notice.
2. As soon as practicable, per call-in rules
   For unforeseeable leave, the FMLA requires notice as soon as practicable, generally following the employer's usual call-in procedures.
3. At least 30 days before the leave begins
   30 days' advance notice applies to foreseeable leave, not a sudden hospitalization.
4. Within 15 days after the leave begins
   There is no fixed 15-day grace period after leave starts; notice is due as soon as practicable.

An employee asks for FMLA leave. Which situation MOST clearly qualifies as a serious health condition?

1. An elective cosmetic procedure
   Elective cosmetic procedures are excluded unless they need inpatient care or complications arise.
2. A routine dental cleaning and checkup
   Routine dental and medical checkups are excluded from the definition.
3. Four days' incapacity, two doctor visits
   More than three consecutive full days of incapacity plus two treatment visits meets the FMLA continuing-treatment test.
4. A two-day cold treated with rest at home
   A short cold treated with rest at home generally does not qualify.

A 58-year-old manager is offered severance in an individual separation (not part of a group program) in exchange for a release that waives ADEA claims. Under the OWBPA, what is the minimum time the manager must be given to consider the release?

1. 60 days
   60 days is the WARN notice period, unrelated to OWBPA waivers.
2. 7 days
   7 days is the revocation period after signing, not the time to consider the release.
3. 45 days
   45 days applies to group exit-incentive or termination programs, not an individual separation.
4. 21 days
   For an individual separation, the OWBPA requires at least 21 days to consider an ADEA waiver.

A merit matrix gives 'exceeds' performers 5% below a 0.90 compa-ratio, 4% from 0.90 to 1.10, and 3% above 1.10; 'meets' performers get 3%, 2% and 1%. An 'exceeds' employee earns $43,000 in a grade with a $50,000 midpoint. What increase applies?

1. 5%
   The compa-ratio is $43,000 ÷ $50,000 = 0.86, below 0.90, so an 'exceeds' rating gets 5%.
2. 3%
   3% applies above 1.10 for 'exceeds', or below 0.90 for 'meets', and neither fits this employee.
3. 1%
   1% is the 'meets' rate above 1.10, the wrong rating and the wrong band.
4. 4%
   4% applies to 'exceeds' performers at 0.90–1.10, but this employee is at 0.86.

At a nonunion meat-processing plant, employees must put on required protective gear at the plant before their shift, which takes about 15 minutes. Is this time compensable under the FLSA?

1. Yes, but only at the overtime rate
   The time is paid like any other hours worked; it earns overtime only if total hours exceed 40.
2. No; anything under 20 minutes is de minimis
   De minimis covers only a few uncertain minutes, not a regular, required 15 minutes, and the FLSA sets no 20-minute rule.
3. No; preshift activities are never paid
   Preshift activities are paid when they are integral to the job, as required protective gear is.
4. Yes; it is integral to their principal work
   Putting on required protective gear is integral and indispensable to the principal work, so it is compensable and starts the workday.

A non-exempt employee works 46 hours in week 1 and 34 hours in week 2 of a biweekly pay period. How many overtime hours does the FLSA require the employer to pay?

1. 0
   Averaging the two weeks to 40 hours is not allowed; each workweek stands alone.
2. 6
   Overtime is figured week by week: 46 hours in week 1 means 6 overtime hours, and week 2 has none.
3. 12
   12 hours double-counts the overtime; only the 6 hours over 40 in week 1 qualify.
4. 3
   3 hours has no basis in the FLSA; the 6 hours over 40 in week 1 are owed.

An HR coordinator is paid a salary of $640 per week and performs duties that meet the administrative exemption duties test. Is she owed overtime for hours worked over 40 in a week?

1. Yes, HR coordinators can never be exempt
   HR coordinators can be exempt if they meet both the duties and the salary tests.
2. No, the salary is above the $455 weekly minimum
   $455 was the salary level before 2020; DOL now enforces $684 per week, so $640 falls short and overtime is owed.
3. Yes, the salary is below $684 per week
   The exemption needs both the duties test and a salary of at least $684 per week (the level DOL enforces), so $640 means she is owed overtime.
4. No, she meets the duties test
   Passing the duties test is not enough when the salary is below the salary-level test.

A non-exempt remote employee often answers work emails after hours without recording the time. The manager is aware of it. What is the employer's obligation under the FLSA?

1. Nothing; no one requested the work
   Work that is suffered or permitted is compensable even when no one requested it.
2. Pay only for time beyond 40 hours
   All hours worked must be paid at the regular rate, not just the hours over 40.
3. Pay only if the employee asks in writing
   No written request from the employee is required; the employer's knowledge triggers the duty to pay.
4. Pay for the time it knew or should have known about
   Under the FLSA, time the employer knows or should know about counts as hours worked and must be paid.

An employee becomes a participant in the company's 401(k) plan. Within how many days must the plan administrator provide the Summary Plan Description?

1. 90 days
   ERISA requires the summary plan description within 90 days after a person becomes a participant.
2. 30 days
   30 days is too short; the ERISA deadline for a new participant is 90 days.
3. 210 days
   210 days is the deadline for a summary of material modifications after plan year-end, not the SPD.
4. 120 days
   120 days is the deadline for a newly established plan, not for a new participant in an existing plan.