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To my husband Chris, whose three little words never fail to inspire me: “Go for it.” To my children, Calvin and Clara, because the best part of me will eternally be each of you. I am filled with love and gratitude for having the three of you in my life.
Any acknowledgment in the updating of this book must begin by recognizing the professionalism and intellect of Anne Bogardus. Her thoroughness and attention to detail represented in the previous editions of this work made writing these updates an absolute career highlight.
To the editors Kenyon Brown, Kelly Talbot, Elizabeth Welch, Pete Gaughan, and Christine O'Connor, thank you for your professionalism, encouragement, superior organizational skills, insightful additions, and most importantly your patience as we updated the book not once but twice—it absolutely made for a better final product. To Pantelis Markou, I cannot describe the comfort level of having your expertise and conscientiousness as my technical editor. If I missed a critical element, I knew you would find it!
A book like this requires a great deal of time and thought, and the contributions from experts Dr. Erin Richard, Reut Schwartz-Hebron, Hector Alvarez, and Joanne Walters added different voices and critical perspectives to the exam content. I am in awe of and grateful for their contribution.
Finally, to the students, a brief mention of my own testing experience: I remember sitting in my hotel room the night before my SPHR exam, trying to cram in a few more details, desperate to figure out what I didn't already know. It was around Christmas time, and my youngest child was just two years old. Feeling guilty for being away from my family and with my confidence at an all-time low, I wondered if I was really up for the challenge. Then, surrounded by my books and flashcards, I suddenly “got” it. The pieces starting fitting together, the processes had rationale, and the big picture came into clear focus. The next morning, I took a four-hour exam in just two hours and passed it on the first go-round. My excitement about being a part of this project is a reflection of that one “a-ha” moment, representing for me when HR crosses over from just being a job to an intelligent, strategic career choice. My hope is that with each pass through this material, you will get closer to your own enlightened moment when you suddenly just get it. Many thanks, and good luck in your career—this absolutely can happen for you!
Sandra M. Reed, SPHR, has more than 20 years of experience in human resources, the last 15 of which have been spent in training and instruction. Her undergraduate degree is in industrial-organizational psychology, and she is a lifelong student of organizational leadership. Sandra is a certified practitioner of the MBTI personality assessment and is qualified to instruct the Leadership Training for Managers and Foundation for Success programs through Dale Carnegie. She obtained her PHR and her SPHR designations through the Human Resource Certification Institute and received her teaching credential in adult vocational education from California State University, San Bernardino. Sandra is the author of A Guide to the Human Resource Body of Knowledge (HRBoK™) and The PHR¯ and SPHR¯ Professional in Human Resources Certification Complete Practice Tests: 2018 Exams, both available through John Wiley & Sons. She has authored learning modules and case studies for the Society for Human Resource Management, focusing on educating the emerging workforce and future human resource professionals. She currently is the owner of Epoch Resources, a consulting firm located in the Central Valley of California that specializes in the unique HR needs of small businesses. Find her on the web at http://epochresources.com.
Pantelis Markou is the senior vice president of human resources and administration for Mikimoto America and an adjunct professor of business psychology. With over 18 years of corporate experience in the fashion and jewelry industries, some of his specialties include business strategy, executive selection and coaching, leadership development, change management, organizational design and restructuring, and cultural integration for mergers and acquisitions. In addition to his responsibilities in human resources, he oversees information technology, real estate, legal, and commercial insurance. Pantelis holds a BS in psychology from Brooklyn College, an MA in organizational psychology from Columbia University, and a PhD in business psychology from the Chicago School of Professional Psychology.
Congratulations on taking the first step toward achieving your Professional in Human Resources (PHR) or Senior Professional in Human Resources (SPHR) certification! The process you're embarking on is rewarding and challenging, and as more than 500,000 of your fellow human resource colleagues in more than 100 countries have already discovered, it's an excellent opportunity to explore areas of HR management with which you may not work every day. In the next few pages, you'll find some general information about HR certification, some suggestions for using this book, information about what to expect in the following chapters, and a discussion of the organizations involved in certification.
Before we begin, a word about what you should already know. This study guide was designed to serve as a refresher for experienced professionals who have practiced for several years or have been educated in human resources. We assume that those who are pursuing certification have the basic HR knowledge that comes not only from education in human resources but also, more importantly, from exempt-level experience. If your daily work is truly generalist in nature, you likely have touched on many of the topics I cover, but you may not have in-depth knowledge in all of them. Conversely, if you specialize in one or two areas of HR, you probably have extensive experience in those areas but may need to refresh your knowledge in other areas.
Additionally, for SPHR candidates, there is an assumption that you have the benchmark knowledge that PHR candidates are learning. This means that there is likely opportunity within the PHR chapters for SPHR candidates to refresh their knowledge. These are referenced throughout the SPHR chapters where appropriate.
The goal of this study guide is to provide enough information about each of the functional areas of HR management to enable candidates in either situation to find what they need to prepare themselves for successfully completing the exam. More than 50,000 books related to human resources are listed on Amazon.com alone, and there is obviously no way we can cover all the aspects of HR in a single book. So, we've organized the information around the exam content outline (ECO) established by the Human Resource Certification Institute (HRCI), the certifying body for our profession. We'll talk more about the content outline in Chapter 1, “Certifying Human Resource Professionals,” but for now, suffice it to say that the key to success on the exam is a thorough understanding of and ability to apply the test specs when answering questions on the exams.
What exactly is human resource certification? Briefly, certification is a way of acknowledging individuals who have met the standard of competency established by HR practitioners as that which is necessary to be considered a fully competent HR professional. To understand whether this book is for you, you'll want to know why you should become certified and how the certification process works.
Two organizations are involved in the certification of HR professionals: the Human Resource Certification Institute (HRCI) and Pearson VUE.
HRCI is the certifying body for the HR profession. It was formed by the American Society of Personnel Administrators (ASPA) in 1972, when it was known as the ASPA Accreditation Institute (AAI). In its early stages, HRCI was financially dependent on the Society for Human Resource Management (SHRM), but it's now financially independent. Both HRCI and SHRM have individual boards of directors that govern their operations. Although HRCI and SHRM have a long history of affiliation and mutual support, the certification process is a separate and distinct function of HRCI.
You can find HRCI's organizational mission statement at www.hrci.org/about-hrci/overview/mission.
Pearson VUE is a computer-based testing administrator headquartered in the United States with locations in the United Kingdom, Japan, Australia, India, Dubai, and China. More than 400 credential owners use their services to administer exams, including HRCI. Pearsonvue.com is where certification seekers will register for their exam date and location.
We'll refer to these organizations frequently in Chapter 1 as we discuss the body of knowledge and the certification process.
Over time, the certification offered by HRCI has become the industry standard for determining competence in the field of human resources. There are many reasons that individuals may decide to seek professional certification. Let's talk about just a few of them.
First, certification is an acknowledgment that you have met the standards of excellence determined by other HR professionals to be those that are necessary to be fully competent in the field. Because the standards are developed by working professionals, not just by those who teach and consult in the field, this credential demonstrates that you're a fully competent HR practitioner based on a standard set by your peers.
Second, certification is a way to increase your marketability. In difficult economic times, when there is tough competition for jobs, certification provides an edge that can be advantageous in your job search. With an abundance of job seekers for a limited number of jobs, whatever you can do to set yourself apart from the crowd can give you the edge when potential employers are making the final hiring decision. Additionally, a 2018 Payscale survey found that certified HR professionals rank the HRCI exams as #1 of all professional exams and that they are the most valuable. The survey also noted that “We found that for the most part, having an HR certification is beneficial from a pay perspective and a career advancement perspective.” See the full survey results at www.payscale.com/data/hr-certifications-pay.
Third, those who spend the time to advance their own knowledge and achieve certification have demonstrated their ability to continue learning and growing as times and business needs change. A person who is willing and able to set a significant goal and do what is necessary to achieve it demonstrates characteristics that are in great demand in business today: results orientation, technical competence, commitment, and excellence.
Finally, certification enhances your credibility with co-workers and customers by demonstrating to the people you encounter during your workday that you have proven competence in the field.
Whether your reason for seeking certification falls into one of these categories or you're motivated to do so for some other reason, it can be a great opportunity to validate how much you already know about the practice of human resources as a profession.
To become a certified HR professional, you must pass either the PHR or SPHR exam, both of which have been developed by HRCI in a comprehensive process described in Chapter 1.
Each exam, PHR and SPHR, consists of 175 questions. Of these questions, 150 are scored to determine whether you pass the exam. The additional 25 questions are being “pretested” in order to determine their reliability and validity for inclusion in future test cycles. You can find a detailed discussion of how the questions are developed and scored in the HR Certification Institute's 2019 Certification Policies and Procedures Handbook, which can be viewed and/or downloaded at the HRCI website (www.hrci.org). The handbook is an essential guide to all aspects of the exams and includes test dates, application deadlines, fee information, and answers to frequently asked questions about the certification process, as well as the full list of test specifications.
Chapter 1 explains in greater detail how much and what kinds of experience are required for each exam level and how the questions differ on each level.
We've talked a little about Chapter 1, which provides information about requirements for certification and the testing process. Chapter 1 also provides some suggestions on the best ways to study for the exam.
Chapters 2–6 get down to the specifics of each functional area of the PHR exam. Chapters 7–11 dive into SPHR exam content. Each of these chapters consists of a list of responsibilities and knowledge requirements for its functional area. We have also provided appendices to facilitate your study. Appendix A, “Answers to Review Questions,” provides all of the answers to the questions at the end of every chapter.
Appendix B, “PHR and SPHR Case Studies,” gives you an opportunity to pull information from multiple functional areas to solve typical HR challenges in a fictitious company.
Appendix C, “Federal Employment Legislation and Case Law,” is a listing of the federal legislation as well as significant court decisions with implications for human resources.
Appendix D, “Resources,” is just that: a list of additional sources of information about each of the functional areas of human resources.
Appendix E, “Summarizing the Summaries: What Meta-Analyses Tell Us About Work Engagement,” and Appendix F, “Neuroscience Principles and Applications for HR Leaders,” provide further insights from leading experts in the field.
Finally, we've provided additional study tools, including sample tests, electronic flashcards, and a glossary of terms (an alphabetical listing of key HR terms with their corresponding definitions).
You'll see many recurring elements as you read this study guide. Here's a description of some of those elements:
Assessment Test At the end of this introduction is an assessment test that you can use to check your readiness for the exam. Take this test before you start reading the book; it will help you determine the areas on which you may need to brush up. The answers to the assessment test questions appear separately after the last question of the test. Each answer includes an explanation and a note telling you the chapter in which the material appears.
Summary The summary is a brief review of the chapter to sum up what was covered.
Exam Essentials The “Exam Essentials” section at the end of each chapter highlights topics that could appear on one or both of the exams in some form. Although we obviously don't know exactly what will be included in a particular exam, these sections reinforce significant concepts that are key to understanding the functional area and the test specs HRCI has developed.
Review Questions Each chapter includes 20 practice questions designed to measure your knowledge of key ideas discussed in the chapter. After you finish each chapter, answer the questions; if some of your answers are incorrect, it's an indication that you need to spend more time studying that topic. The answers to the practice questions can be found in Appendix A. The chapter review questions are designed to help you measure how much information you retained from your reading and are different from the kinds of questions you'll see on the exam.
The interactive online learning environment that accompanies PHR¯ and SPHR¯ Human Resources Certification Complete Study Guide: 2018 Exams provides a test bank with study tools to help you prepare for the certification exam—and increase your chances of passing it the first time! The test bank includes the following:
Sample Tests All the questions in this book are provided, including the chapter tests that include the review questions at the end of each chapter. In addition, there are two practice exams (one each for the PHR¯ and SPHR¯) that have a variety of question formats that match the newly structured exams as of the fall of 2018. Use these questions to test your knowledge of the review guide material. The online test bank runs on multiple devices.
Flashcards Two sets of questions are provided in digital flashcard format (a question followed by a single correct answer); one set is for the PHR¯ and the other set is for the SPHR¯. You can use the flashcards to reinforce your learning and provide last-minute test prep before the exam.
Other Study Tools A glossary of key terms from this book and their definitions is available as a fully searchable PDF.
Go to www.wiley.com/go/sybextestprep to register and gain access to this interactive online learning environment and test bank with study tools.
This book has a number of features designed to guide your study efforts for either the PHR or the SPHR certification exam. All of these features are intended to assist you in doing the most important thing you can do to pass the exam: understand and apply the test specs in answering questions. This book helps you do that by listing the current responsibilities and knowledge requirements at the beginning of each chapter and by ensuring that each of them is fully discussed in the chapter.
The practice questions at the end of each chapter and the practice exams (which can be found in the online test bank at www.wiley.com/go/sybextestprep) are designed to assist you in testing your retention of the material you've read to make you aware of areas on which you should spend additional study time. We've provided web links and other resources to assist you in mastering areas where you may require additional study materials. Here are some suggestions for using this book and study tools:
Finally, find a study partner if possible. Studying for, and taking, the exam with someone else will make the process more enjoyable, and you'll have someone to help you understand topics that are difficult for you. You'll also be able to reinforce your own knowledge by helping your study partner in areas where they are weak.
According to the WARN Act, an employer with 200 employees is required to provide 60 days' notice of a mass layoff when which of the following is true?
An employee has come forward with an allegation of quid pro quo harassment by her supervisor. As the HR manager, you are responsible for investigating the complaint. The supervisor in question is someone with whom you have become quite friendly. In this case, who is the best person to conduct the investigation?
As of 2009, the federal minimum wage is set at which of the following?
During the union-organizing process, how is the bargaining unit determined?
The motivation theory that suggests people are motivated by the reward they will receive when they succeed and that they weigh the value of the anticipated reward against the effort required to achieve it is known as what?
What is the most effective method of performance evaluation?
Which of the following is an example of a nonqualified deferred-compensation plan?
Which of the following is an example of a passive training method?
What is the purpose of the OSHA consulting service?
Measuring staffing needs against sales volume could be done most effectively by using which of the following techniques?
What is an employer's responsibility when workplace conditions pose a threat to an unborn child?
What does the Health Insurance Portability and Accountability Act do?
The concept that recognizes that businesses are social organizations as well as economic systems and that productivity is related to employee job satisfaction is known as what?
Total quality management focuses all employees on producing products that meet customer needs. This is achieved by doing what?
The correlation coefficient is a statistical measurement that is useful for which of the following?
The process of identifying risks and taking steps to minimize them is referred to as what?
What is the most effective method to use when an employer wants to obtain insight into employee goals and job satisfaction and provide career counseling to those in the work group?
Which of the following is an example of workplace ethics issues?
Which of the following statements about substance abuse policies is not true?
Which one of the following statements is true of a hostile work environment?
An HR audit is designed to help management do what?
A high-involvement organization is an example of what type of OD intervention?
Claims of disparate treatment for employees caring for elders, children, or disabled family members increased 450 percent between 1990 and 2005. Which of the following provides one of the bases for filing these claims?
Which of the following would be considered an extrinsic reward?
According to the Copyright Act of 1976, which of the following is most likely to be considered a fair use of copyrighted material?