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University of Mt. Olive

HRM 322

Chapter 6

1)An employee separation occurs when:

A)employee turnover reaches maximum capacity.

B)            global competition increases beyond labor supply.

C)            an employee ceases to be a member of an organization.

D)           technologies are introduced into a new industry.

 

2)            A company wants to know the rate at which employees voluntarily leave the firm. The company most likely needs to:

A)           measure its turnover rate.

B)            conduct an HR audit.

C)            implement a diversity audit.

D)           track reasons for discharges.

 

3)            Companies most likely attempt to manage their turnover rates because of:

A)           potential problems associated with public relations.

B)            legal requirements regarding layoff notifications.

C)            inadequate affirmative action plans. D) high employee replacement costs.

 

4)            The costs of employee separations primarily depend upon which of the following?

A)           Whether the employee was a member of a protected class or not

B)            Whether the employee had a voluntary separation C) Whether the employee will be replaced or not

D) Whether the employee was a new hire

 

5)            Which of the following is a recruitment cost associated with employee replacement?

A)           Outplacement

B)            Reference checks

C)            Orientation D) Advertising

 

6)            Which of the following factors is the LEAST common reason for turnover among Chinese workers?

A)           Lack of development opportunities

B)            Manager-employee relationships

C)            Insufficient compensation D) Tedious work

 

7)            Which of the following is a selection cost of employee replacement?

A)           Advertising

B)            Outplacement

C)            Search firm fees D) Reference checks

 

8)            Martin is reviewing HR's costs for interviewing, testing, and checking references for new hires. Martin is most likely reviewing the             costs of employee replacement.

A)           training B) selection

C)            separation

D)           recruitment

 

9)            Which of the following is a replacement cost associated with training new employees? A) Employment testing

B)            Outplacement services

C)            Recruiter time

D)           Lost productivity

 

10)          Which of the following is the most significant separation cost for employers?

A)           Search firm fees

B)            Lost productivity

C)            Outplacement assistance D) Compensation

 

11)          The time and cost of exit interviews are part of the         costs of an employee separation.

A)           recruitment

B)            selection

C)            training D) separation

 

12)          Which term refers to an employee's final interview following separation? A) Exit interview

B)            Follow-up interview

C)            Appraisal interview

D)           Outplacement interview

 

13)          Your company is planning a layoff. As you explain the process to the management team, you tell them that outplacement assistance is available, which means that the:

A)           employee will receive a final interview.

B)            company will help departing employees find new jobs.

C)            company will measure the rate of employee separations.

D)           company can terminate the relationship with the employee for any reason.

 

14)          What is the primary reason for holding exit interviews?

A)           Providing counseling to departing employees

B)            Assisting departing employees with job-search skills C) Determining the reason for the employee's departure

D) Allowing the employee's co-workers to provide feedback

 

15)          Carlie quit her job as a data analyst at APEX Designs, and she is scheduled to participate in an exit interview. Which of the following individuals would be the most appropriate to conduct Carlie's exit interview?

A)           Subordinate

B)            Co-worker

C)            HR representative

D)           Immediate supervisor

 

16)          Sanford Enterprises provides outplacement assistance through its HR department. The firm is most likely attempting to:

A)           lower unemployment insurance taxes. B) help departing employees find jobs.

C)            improve employee motivation.

D)           comply with EEOC rules.

 

17)          Which of the following is most likely  about employee separations? A) Salary savings often outweigh other separation costs.

B)            Innovation declines as people take their ideas with them.

C)            The best workers tend to quit, so workforce quality declines over time.

D)           Most separations are due to unfair employment practices by the employer.

 

18)          Which of the following is most likely a benefit of employee separations for employers?

A)           Employees are grouped into teams.

B)            The workforce becomes more homogenous.

C)            Surviving employees work more conscientiously. D) They open doors for promotion within the company.

 

Additional Case 6.1

Central Enterprises is suffering an economic downturn, and the workforce needs to be reduced. Upper-level managers are debating the costs and benefits of various employee separations. Brian argues that the company needs to make immediate cuts to both management and labor. The cuts need to be made in such a way that the scope of the company and its markets are not affected.

The firm needs to do more with fewer people according to Brian.

 

Other managers want to take a long-term, less traumatic approach. According to Natalie, the firm has time to consider the problems and gradually reduce the workforce rather than making sudden staff cuts. Natalie points out that 35% of the workforce is over age 62.

 

The VP of HR, LaTisha, wants the least disruptive reduction process possible. LaTisha just finished a major labor negotiation with the union and is not ready for another. She points out that turnover has been fairly high. Along with considering workforce reductions, LaTisha wants to know why people are leaving the company voluntarily.

 

19)          Refer to Additional Case 6.1. To answer LaTisha's question about why people are leaving, the company should most likely institute:

A)           outplacement services.

B)            orientation sessions. C) exit interviews.

D) appraisals.

 

20)          Yao-Huan is reviewing the rate at which employees have been leaving his firm. He is reviewing the firm's turnover rate.

 

21)          A firm with an extremely high turnover rate compared to other firms in the same industry most likely needs to address HR issues.

 

22)          The costs to replace a departing employee primarily include: recruitment, selection, and long-term health care benefits.

 

23)          Selection costs include relocation costs, training costs, orientation, and severance pay.

 

24)          Marissa quit her current employer for a new job. She is talking with the director of HR about why she left. Marissa is most likely receiving outplacement assistance.

 

25)          When conducting exit interviews, the interviewer should be one of the employee's former supervisors.

 

26)          Web-based exit interviews are used by firms that assume former employees may prefer to avoid face-to-face interaction.

 

27)          Employee separations can stimulate innovation and create opportunities for workplace diversity.

 

28)          The termination of an employee's membership in an organization is referred to as           .

 

29)          The rate of employee separations in an organization is referred to as      .

 

30)          The purpose of a(n) _    is to find out the reasons why the employee is leaving or to provide counseling and/or assistance in finding a new job.

 

31)          A program in which companies help their departing employees find jobs more rapidly by providing them with training in job-search skills is called

 

32)          Hernando is working with management to calculate the costs of employee turnover. What issues or costs should Hernando raise to management?

 

 

 

33)          What problems are frequently associated with early retirement programs?

 

 

 

How can HR minimize such problems?

 

 

 

 

 

What benefits might a firm experience from such employee separations?

 

 

 

 

 

 

 

 

 

Additional Case 6.3

MedEquip, a medical services company with 500 employees, has experienced an extensive business downturn, and a layoff is necessary. MedEquip managers expect a layoff to be problematic because the firm made verbal commitments to workers for lifetime employment. You are an HR consultant brought in to assist with the layoff. The firm has also hired a PR specialist to handle the press releases and public communications about the layoff. Although MedEquip is a large company, the firm has built a family atmosphere. Corporate headquarters is located in a small community of about 10,000 people.

 

The firm is planning to implement a layoff of 20% of its hourly and managerial employees. Because of time demands and financial pressures, the layoff will occur in 30 days. The firm plans to use work performance as the layoff criterion. Three areas of the business will be

 

affected: MIS, facilities, and accounting. Management is concerned about security in these areas.

 

Olivia, a middle manager who will not be laid off, has decided to hold group meetings with the units affected by the layoff. Employees will not receive information in writing regarding the layoff to avoid litigation issues. Instead, affected employees will receive verbal communications from Olivia about the layoff. Employees at the firm who are not losing their jobs will receive e- mails that summarize the current situation at MedEquip.

 

34)          Refer to Additional Case 6.3. Which of the following questions is LEAST relevant to MedEquip at this time?

A)           How will MedEquip's community reputation be affected?

B)            How can MedEquip maintain the morale of surviving employees?

C)            How do MedEquip's competitors handle employee security during layoffs?

D)           What policies exist regarding separation pay for laid-off MedEquip employees?

 

35)          Your CEO asks you, as the director of HR, to lead a layoff planning session. What layoff alternatives are available to the firm? If layoffs are necessary, what separation costs would the firm most likely incur?

The layoff alternatives that are available to the firm include implementing employment policies, change some job designs, implement pay and benefits policies, and offer training. If layoffs are necessary, separation costs that the firm would be likely to incur are separation pay and other benefits such as insurance.

 

36)          Resignations and retirements are examples of:

A)           essential downsizing measures.

B)            involuntary separations. C) voluntary separations.

D) discharges.

 

37)          Studies show that approximately             of voluntary employee separations are avoidable. A) 20%

B) 40%

C) 60%

D) 80%

 

38)          Voluntary separations may include:

A)           early retirements.

B)            hiring freezes.

C)            discharges.

D)           job redesigns.

 

39)          Similar to a quit, a            is initiated by the employee, but in this case the employee is unlikely to search for another job.

A)           layoff

B)            retirement

C)            discharge

 

D)           buyout

 

40)          Sara is 57 years old and she has been a division manager for Elf Cookies for 32 years. Recently, the business has seen an increase in efficiency and has a surplus of labor. Elf Cookies is offering employees who are 55 and older, and who have worked for the company for over 30 years, specific benefits and financial incentives to retire within the next 60 days. Sara does so. She has:

A)           quit.

B)            been bought out.

C)            taken early retirement.

D)           been discharged.

 

41)          The decision to terminate an employee is management's role. HR's primary role is to:

A)           implement outplacement services immediately.

B)            serve as the employee's advocate against management. C) make certain the employee receives due process.

D) document poor performance so the termination can be justified.

 

42)          Alex is a first-line supervisor with an employee who has a performance problem. After coaching the employee with no improvement, Alex decides to terminate the employment relationship. Which term refers to this type of separation?

A)           Layoff B) Discharge

C)            Rightsizing

D)           Early retirement

 

43)          Bertha wishes to discharge one of her poorly performing employees. She has tried progressive discipline with no effect. She asks you, the HR manager, what she must do to discharge the employee. You should most likely tell her the policy and procedures, and then ask her if she has    in order to protect the company from a wrongful discharge suit.

A)           documented the inappropriate behavior

B)            given sixty days notice as required by law

C)            used non-progressive disciplinary actions

D)           analyzed the department's diversity levels

 

44)          Delmus' performance reports have been increasingly poor, and he seems to have negative relationships with other workers in his department. His line manager has taken him aside twice to discuss his behavior and work and has offered him time to improve, but there has been very little positive progress. Management decides to end the employment relationship with Delmus. This is an example of a:

A)           layoff.

B)            quit.

C)            discharge.

D)           buyout.

 

45)          The primary difference between a layoff and a discharge is:

 

A)           a layoff is an involuntary separation and a discharge is a voluntary separation.

B)            a layoff is a voluntary separation and a discharge is an involuntary separation.

C)            a discharge occurs when the company's strategy forces it to reduce its workforce and a layoff occurs when there is a poor fit between the employee and the organization.

D)           a layoff occurs when the company's strategy forces it to reduce its workforce and a discharge occurs when there is a poor fit between the employee and the organization.

 

46)          Layoffs are most likely to occur because:

A)           the firm offers lucrative incentives to reduce the workforce.

B)            adequate documentation exists of the worker's poor performance.

C)            a poor fit exists between the employee and the company. D) the company's strategy forces a reduction in its workforce.

47)          All of the following are primary reasons for layoffs EXCEPT:

A)           mergers B) misconduct

C)            global competition

D)           technology advancements

 

48)          Dixon Enterprises needs to reduce its long-term workforce. The firm wants to reduce the scale and scope of its business to improve financial performance. The company is most likely:

A)           conducting a layoff.

B)            downsizing.

C)            buying out the workforce.

D)           rightsizing.

 

49)          If a business is downsizing, it is most likely:

A)           offering training and development opportunities to new hires.

B)            improving worker efficiency through reorganization. C) reducing the size and scope of the business.

D) offering early retirements to older workers.

 

50)          A firm with too many management layers and bureaucratic work processes would most likely benefit from:

A)           rightsizing.

B)            discharges.

C)            downsizing.

D)           early retirements.

 

51)          The major difference between downsizing and rightsizing is that:

A)           rightsizing reduces the size and scope of a business, while downsizing reorganizes the business.

B)            more workers are likely to lose their jobs during rightsizing than during downsizing. C) downsizing reduces the size and scope of a business, while rightsizing reorganizes the business.

D) rightsizing attempts to improve financial performance, while downsizing attempts to increase efficiency.

 

 

Additional Case 6.1

Central Enterprises is suffering an economic downturn, and the workforce needs to be reduced. Upper-level managers are debating the costs and benefits of various employee separations. Brian argues that the company needs to make immediate cuts to both management and labor. The cuts need to be made in such a way that the scope of the company and its markets are not affected.

The firm needs to do more with fewer people according to Brian.

 

Other managers want to take a long-term, less traumatic approach. According to Natalie, the firm has time to consider the problems and gradually reduce the workforce rather than making sudden staff cuts. Natalie points out that 35% of the workforce is over age 62.

 

The VP of HR, LaTisha, wants the least disruptive reduction process possible. LaTisha just finished a major labor negotiation with the union and is not ready for another. She points out that turnover has been fairly high. Along with considering workforce reductions, LaTisha wants to know why people are leaving the company voluntarily.

 

52)          Refer to Additional Case 6.1. Brian would most likely advocate a strategy of:

A)           attrition.

B)            downsizing.

C)            rightsizing.

D)           early retirements.

 

Additional Case 6.4

Organizers, Inc. has implemented new business technologies that require fewer employees. Paul, the firm's CEO, sees the need to eliminate some middle managers and institute work teams to eliminate ineffective or unnecessary work processes. He believes that such changes won't be costly to the business. Most of the middle managers have been with the company anywhere from 10-15 years but are a long way from retirement.

 

One specific problem that Paul recognizes involves Zena, an upper-level manager. Zena has been coming to work late, missing deadlines on assignments, and refusing to complete an important assignment. Paul has warned Zena personally about the consequences for further actions and has even meted out several proscribed disciplinary actions against Zena. Her work habits have not improved, and Paul feels he may have to take further action.

 

53)          Refer to Additional Case 6.4. By Paul's estimation, Organizers, Inc. most likely needs to do which of the following to improve efficiency?

A)           Implement internship opportunities B) Perform a large-scale layoff

C)            Downsize

D)           Rightsize

 

54)          Recent studies have shown that 80% of voluntary separations are unavoidable.

 

55)          A quit and a retirement are similar types of employee separations since both are initiated by

 

the employee.

 

56)          Employers can force an employee to retire if the employee is 65 years of age or older.

 

57)          Involuntary separation results from one of two conditions: 1) economic necessity or 2) a poor fit between the employee and the organization.

 

58)          Rightsizing is synonymous with downsizing.

 

59)                          is a separation that occurs when an employee decides, for personal or professional reasons, to end the relationship with the employer.

 

60)          A separation that occurs when an employer decides to terminate its relationship with an employee due to economic necessity or a poor fit between the employee and the organization is called _               .

 

61)                          is a company strategy to reduce the scale and scope of its business in order to improve the company's financial performance.

 

62)          The process of reorganizing a company's employees to improve their efficiency is referred to as                               .

 

 

 

63)                          is an employment policy designed to reduce the company's workforce by not refilling job vacancies that are created by turnover.

 

Additional Case 6.4

Organizers, Inc. has implemented new business technologies that require fewer employees. Paul, the firm's CEO, sees the need to eliminate some middle managers and institute work teams to eliminate ineffective or unnecessary work processes. He believes that such changes won't be costly to the business. Most of the middle managers have been with the company anywhere from 10-15 years but are a long way from retirement.

 

One specific problem that Paul recognizes involves Zena, an upper-level manager. Zena has been coming to work late, missing deadlines on assignments, and refusing to complete an important assignment. Paul has warned Zena personally about the consequences for further actions and has even meted out several proscribed disciplinary actions against Zena. Her work habits have not improved, and Paul feels he may have to take further action.

 

64)          Refer to Additional Case 6.4. Paul believes strongly in trying to provide lifetime employment and will use a layoff only as a last resort. What would be the best strategy to reduce middle management?

A)           Offering early retirement to employees in middle management.

B)            Instituting a pay freeze only for employees in middle management.

C)            Encouraging employees in middle management to take voluntary time off for at least 60 days.

D)           Developing HR policies regarding the use of pay incentives to encourage middle managers to quit.

 

 

65)          What is an involuntary separation?

 

What are some examples of involuntary separations?

 

 

How can the difficulties of involuntary separations be managed with outplacement programs?