Quiz 17: Government and Legal Issues in Compensation

Business

Government plays varied roles in the compensation of employees in workplaces. The nature of government's role in the compensation is through direct regulations and through policies and purchases affecting supply and demand. The nature of government roles in the compensation of employees in different workplaces of a country are as follows: • Government takes decision in compensation for procedures of fair pay determination • Government provides safety nets for unemployed • Government examines that the disadvantages are sufficient like minimum wages and compensation for unemployment • Government examines that employees are protected from the exploitation through providing overtime pay and restrictions on child labor • Government employs significant number of employees in different government sectors which affects labor demand • Government affects supply of labor through legislation Hence the above nature of government role in the compensation of employees is played in a country.

Ms. O is exempt under the Fair Labor Standards Act. This can be attributed to the fact that she qualifies under Professional Exemption from Fair Labor Standards Act. Since Ms. O has a salary exceeding $ 455 per week. Apart from that her work involves artistic components.

Following are the main checkpoints and consideration that contractors should take in complying with OFCCP Self-Evaluation Guidelines. • Contractors can choose their own compensation self-evaluation technique. However it should comply with the laws and regulations lay down by the department of labor. • Self-evaluation guidelines are voluntary. However not having any these guidelines at all would imply a breach of regulations. Complying with the guidelines gives the competitor an edge. • SSEG's can be made for evaluation of employees having a similar standing and roles. The members of SSEG should have similar work, common responsibility technically or functionally. • Making an improper SSEG would make the self-evaluation process cumbersome for the contractor. • The type of work performed (irrespective of domain specialization) can also be used to make SSEG's e.g. VP-HR, VP-Marketing, VP-Finance etc. can be assorted under similar SSEG. • An important quality of SSEG's should be that they should be helpful in statistical analysis. Each SSEG should have 30 members, at least 5 members from males, females, minorities and non-minorities. • Statistical analysis should be done routinely for each SSEG. The statistical tests should be recognized methods and appropriate for the situation. • If the number of employees exceeds 500, only multiple regressions should be done. • Disparity should be considered if the significance level is more than 2 standard deviations away from the mean. • Documents and other relevant data should be maintained by the contractor. The same should be furnished to OFCCP during compliance reviews.

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