PHR Study Guide 2023-2024: Review Book With 350 Practice Questions and Answer Explanations for the Professional in Human Resources Certification

Introduction

‘There are no secrets to success. It is the result of preparation, hard work, and learning from failure.’ – General Colin Powell (Wadsworth, 2021)

The Professional Human Resource (PHR) exam is a certification exam offered by the HR Certification Institute (HRCI) for individuals working in human resources (Passmall, 2022). The PHR exam assesses the knowledgeability of HR personnel in strategic management, risk management, workforce planning and employment, labor and employee relations, human resource development, and compensation and benefits (Passmall, 2022).

This certification is a great way for HR professionals to demonstrate their knowledge and expertise in the field and to advance their careers. The HRCI does not disclose exact figures on the number of people who take the PHR exam each year, but it is one of the organization's most popular certifications. This is understandable, especially when you consider the HRCI has issued over 500,000 professional certifications since it was founded.

The PHR exam is quite challenging, and it is not uncommon for people to take the exam more than once before they pass. The PHR exam has a pass rate of 65%, so more than half of those who take the exam fail on their first attempt (Passmall, 2022). A major reason for this is that the exam includes 175 questions chosen randomly from a pool of thousands of possible questions covering the entire HR field. The test is also scored on a curve, so the difficulty of the questions varies from one candidate to another.

As overwhelming as the process might seem, getting a certification like the PHR is a good way for any HR expert to stay competitive in their field and show their commitment to quality work (Smith, 2022). It will help you showcase your knowledge and skills to your employers, attract better compensation and potentially gain recognition within the HR community.

Maybe you lack the financial means to spend on review classes or professional tutors. Perhaps you have taken the PHR exam before without success. I am a human resources professional and I have spent years teaching aspiring professionals how to pass the PHR exam. Whatever your circumstances are, I believe that with hard work and discipline, you can pass this exam with flying colors. Focused study and preparation can not only help you pass the exam but also improve your job performance and expertise in your field.

Why this book?

I wrote this book to serve as a guide for anyone looking to sit for and pass the PHR exam. Not only do I want to share my knowledge and experience with you in this way, but I also wish to provide you with a review of the key concepts covered on the exam, including two full practice questions with answers. In a nutshell, here’s what you’ll learn in this book: 

●  Chapter One: Here you will learn all about the PHR exam, how it works, and the eligibility requirements. We will also discuss the content outline and some study habits you can adopt to help you prepare adequately for the exam.

●  Chapter Two: You will learn all about the business management topics helpful in the HR profession. We will discuss the organizational structure of companies, regulatory processes, corporate governance, data reporting, risk management, employee communications, and several other business elements of an organization.

●  Chapter Three: Here, you will learn about the best hiring processes to find, attract, and employ top talent for your organization. We will discuss the relevant laws, staffing alternatives, interviewing techniques, workforce assessment, and the best ways to assess the effectiveness of a corporation’s recruitment efforts.

●  Chapter Four: We will discuss how you can apply and evaluate programs to help a company meet its goals. You will also learn about instructional design, organizational development methods, and how to encourage innovation within a company.

●  Chapter Five: In this chapter, you will learn how to apply, promote, and manage reward schemes in strict adherence to all relevant regulations.

●  Chapter 6: Here, we will discuss the largest section of the PHR exam. Specifically, you will learn how to implement initiatives and policies that would boost the experience of employees within your organization.

●  Chapters 7 and 8: These last two chapters would include two full-length practice tests with their detailed answers. The questions will test your understanding of everything we’ve discussed throughout this book and I hope you practice them as often as possible, alongside any other study materials you can access as you prepare for your exams.

Let’s Get Started 

It’s never too early or too late to learn what you need to fully enrich your life. This book will help you ace the PHR exams and advance your career in human resources. It covers everything from recruitment and beneficial employee initiatives to risk management, applicable employment regulations, the role of an effective reward system, and how to guarantee the survival of your organization through succession planning. You will become more confident and familiar with the PHR examination questions each time you use it.

Excited? So am I. Take the first step by reading the rest of this book. 

I’ll be with you every step of the way

Chapter One:  The PHR Exam

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Managing employees of any organization can help you create a good rapport with everyone, but this demands a certain set of abilities, particularly as managing people requires a degree of sophistication, empathy, and understanding. Fortunately, you can advance your HR career by sitting the PHR exam to get certified by HRCI.

Let's go through the PHR exam procedures and eligibility criteria in greater detail below.

Introduction to the PHR Exam

The HR Certification Institute created and maintains the Professional in Human Resources Exam to provide certifications to anyone looking to pursue a professional career in HR (HRCI, 2022). The HRCI is regarded as the leading provider of HR certifications on a global scale and ‌before you register for the PHR, here are a few things you should consider:

When and Where is it Taken?

When your application to sit for this professional exam is accepted, the HRCI would issue you ‌‘an eligibility ID’. Having this in your possession means that you have about 120 days (nearly four months) to prepare for and take your exam.

It is advised that you sign up for your exam as soon as possible to have some control over the time, date, and place of your choice. This is because there usually isn’t enough room or seating to take all candidates and so, the spaces are filled in order of arrival.

In the case of an emergency, you can reschedule your exams for a fee. Otherwise, you will be deemed absent and forfeit all the money paid up to that time. If you cancel, you will receive a confirmation email with the date and time for the new scheduled exam.

What Should I Bring?

For this process, you would need your current, government-issued photo ID, your signature, a current photo that is easily recognizable, and your full name as it appears on your application (Passmall, 2022). Aside from these items, other personal properties such as mobile phones, food, beverages, watches, jewelry, or outerwear are prohibited from the test venue and may be placed in any available lockers or storage facilities during the exam.

What is Covered?

There are five primary components or functional areas covered by this computer-based test. You would also be expected to tackle ‌175 questions, but 25 of those questions will not count towards your final grade even though you must attempt all questions. Total exam time is usually three hours.

How is it Rated?

You'll receive a notification through your HRCI account once your result is uploaded and your scaled score will be published on your score report. This report will also contain details regarding how you performed on each of the exam's main sections. Use this as a reference for subsequent attempts if you were unsuccessful in the test.

If you don't pass the PHR the first time, try not to worry. You can schedule a retest after a 90-day waiting period, although you would need to reapply and pay another fee (Passmall, 2022). Only three exam retakes are permitted in a year, so be mindful of this. If you pass, you will receive information on how to get your digital badge, which serves as your official certification, along with your official exam results (Passmall, 2022). A paper certificate can also be made available to you for an extra charge, and this would bear the three-year expiration date of your PHR certification. To keep your certifications valid, you must complete at least 60 recertification credits within those three years or repeat the test (Passmall, 2022).

All that may sound overwhelming, but I’ve been there, and I know that with hard work and adequate preparations, you can ace this exam. Let us discuss the outline or the various components of the PHR exam, with their weighted scores, below.

Content Outline.

Business management (20%)

This component tests your ability to use your accumulated knowledge about a company and its business environment to influence the right decisions, reinforce expectations, and reduce risks (Passmall, 2022). According to the HRCI, to ace this part of the exam, you would need to show knowledge of: 

●  The organization's value system, mission, and structure.

●  Legal and regulatory procedures and knowledge.

●  Procedures for corporate governance and compliance.

●  Communication among employees.

●  Theory, techniques, and applications of change management.

●  Efficient management of risks.

●  Managing ambiguous, confusing, or chaotic circumstances.

Talent planning and acquisition (16%).

This aspect of the PHR is concerned with how well you can identify, attract, and recruit talent while adhering to all hiring-related federal requirements (Passmall, 2022). According to the HRCI, to ace this aspect of your test, you would need to demonstrate the following knowledge:

●  Relevant federal rules and regulations that pertain to talent development and acquisition operations.

●  Various personnel or staffing options (for example: knowing when to outsource, hire on a part-time basis or full-time).

●  Processes for orienting or inducting new hires.

●  Internal workforce evaluations. (for example, various forms of skills testing within the workforce).

●  Transition strategies for business reorganization, M&A, thorough research, offshoring, as well as divestitures.

●  Other useful metrics for evaluating past and prospective staffing effectiveness.

Development and Learning (10%).

Here, you would be tested on your ability to develop and assess programs, offer internal guidance, and relay data to help an organization’s learning and growth efforts (Passmall, 2022). According to the HRCI, to pass this aspect of the test, you would need to show knowledge of: 

●  Learning and development theories and applications. 

●  All applicable federal rules and regulations relating to development schemes or activities.

●  Facilitation, delivery, and tactics for training programs.

●  Processes of adult learning.

●  Methods and concepts for instructional design.

●  and methods for measuring the success of training programs, using relevant metrics, amongst others.

Total rewards (15%).

This involves how well you can implement, promote, and monitor pay and benefits plans under all relevant federal rules or policies (Passmall, 2022). According to the HRCI, to pass, you need to know:

●  Relevant federal rules and regulations about total rewards.

●  Policies, procedures, and analysis relating to compensation.

●  Payroll, accounting, and budgeting procedures about salary and benefits.

●  Non-cash benefits.

●  Techniques for coordinating and benchmarking pay and benefits.

●  Policies, Procedures, and Analysis for Benefits Programs, etc

Labor and employee relations (39%)

This involves the management, observation, and/or advocation for initiatives and policies that affect employee experience across the employee lifecycle that complies with the law (HRCI, 2022). According to the HRCI, to pass this section of the exam, you must show knowledge of:

●  Basic employee relations activities and analysis (for example, undertaking investigations, investigating grievances, work environment reports, etc.)

●  The relevant federal rules and regulations that impact employment, labor relations, safety, and security.

●  Theories and applications of human interactions, cultures, and ideals to workers and organizations.

●  Assessment and analysis procedure for rating employee satisfaction, attitudes, and opinions.

●  Schemes or programs geared to encourage inclusivity and diversity within an organization.

●  Data privacy and security.

●  The performance management process, processes, and analysis.

●  Collective bargaining.

●  Termination strategies, ideas, terminologies, etc.

From personal experience, I know it can be quite challenging to study for an exam, particularly when you don't know where to start or what is expected of you. So what criteria must you meet as a candidate for the PHR certification? Let us discuss this further below:

Eligibility Requirements.

To qualify for the exam, the HRCI specifies you must hold a master's degree or higher, as well as a minimum of one year of professional experience in human resources (HRCI, 2022). You are also eligible if you have a bachelor's degree, with a minimum of two years of relevant work experience in the HR department.

If you cannot meet these conditions as well, you could still qualify to sit for the PHR exam if you have a minimum of 4 years experience in human resources and a  high school diploma, or GED equivalent. These are non-transferable and non-refundable. After sending in your application successfully, all that would be left to do is prepare for the exam.

Study Habits To Success.

These study habits were pulled from Workforce Hub (2022) and Study Guide Zone (2022), and adopting them will help you prepare well for the PHR exam:

●  Self Assessment.

If you aren’t as knowledgeable as needed in all weighted areas of the exam, how long will it take for you to be ready? You know your shortcomings and your learning speed better than anyone, so you must be honest with yourself here.

●  Make a study schedule

When you have a test date, depending on how prepared you are, create a study timeline to help you