SHRM-CP Exam Practice Test 2026:
Full Diagnostic Assessment||Questions
And Answers With Rationales/Graded
A+/2026 Update/100% Correct
/Instant Download
Section 1: Core Knowledge & Foundational Concept
(Covers: HR Operations, Employment Law, and Total Rewards)
1. An organization is expanding into the European market. Under the General Data
Protection Regulation (GDPR), which of the following is
a mandatory requirement regarding the processing of employee personal data?
A) Obtaining verbal consent from employees for data storage
B) Transferring data freely across global servers without restrictions
C) Appointing a data protection officer (DPO) regardless of company size
D) Establishing a lawful basis (e.g., contract necessity) for processing
Correct Answer: D
Rationale: GDPR requires a lawful basis for processing personal data (e.g.,
performance of a contract, legal obligation). A DPO is only mandatory for core
activities involving large-scale monitoring. Verbal consent is insufficient, and
cross-border transfers are heavily restricted .
2. Under the Worker Adjustment and Retraining Notification (WARN) Act, which
scenario triggers the 60-day advance notice requirement?
A) A layoff of 25% of the workforce at a single site
B) A plant closing affecting 40 employees at a single site
C) A mass layoff involving 500 employees at a single site
D) A reduction in hours resulting in a 30% pay cut for 100 employees
Correct Answer: C
Rationale: WARN Act triggers include: (1) Plant closing with 50+ employees
losing full-time jobs, or (2) Mass layoff of at least 500 employees OR 33% of
,workforce and 50+ employees (minimum 50). Option C (500 employees) clearly
meets the threshold regardless of percentage.
3. A company wants to implement a "Pay Transparency" policy. Which federal
regulation primarily supports an employee's right to discuss wages without
retaliation?
A) The Fair Labor Standards Act (FLSA)
B) The National Labor Relations Act (NLRA)
C) The Civil Rights Act of 1964 (Title VII)
D) The Americans with Disabilities Act (ADA)
Correct Answer: B
Rationale: Section 7 of the NLRA protects "concerted activities," which includes
discussing wages and working conditions among non-supervisory employees, even
in non-union settings. Pay transparency policies are legally protected under the
NLRA.
4. In the context of the SHRM BASK®, the "People" knowledge domain primarily
focuses on:
A) Mergers and acquisitions strategy
B) Workforce planning and talent acquisition
C) Organizational compliance with OSHA standards
D) Corporate social responsibility initiatives
Correct Answer: B
Rationale: The People domain encompasses talent acquisition, total rewards,
learning & development, and employee relations. Mergers (Strategy), OSHA
(Workplace), and CSR (Organization) fall under different domains .
5. An employer offers a high-deductible health plan (HDHP). To comply with IRS
regulations for Health Savings Account (HSA) eligibility, what must the employer
ensure?
A) The plan covers all preventive care with zero deductible
B) The employee is not covered by a non-HDHP or Medicare
C) The employee earns less than the highly compensated threshold
D) The employer contributes the maximum out-of-pocket limit
Correct Answer: B
Rationale: To be HSA-eligible, the employee must have only an HDHP, no other
, disqualifying coverage (including Medicare or general purpose FSA), and cannot
be claimed as a dependent.
Section 2: 2026 Updates — AI, Technology, & Ethics
(Covers: Technology Integration, Data Analytics, and Ethical Practice)
6. According to the 2026 SHRM BASK® updates, when using AI in recruitment,
HR must prioritize which ethical standard to mitigate bias?
A) Proprietary algorithm secrecy
B] Algorithmic transparency and regular auditing
C) Elimination of all human review of applications
D) Restricting AI use to only external candidates
Correct Answer: B
Rationale: The 2026 updates emphasize responsible AI use, requiring transparency
in how algorithms make decisions and regular audits for disparate impact. Black-
box AI is discouraged .
7. An HR analytics team finds a strong correlation between commuting distance
and early tenure turnover. What is the most appropriate first step?
A) Immediately terminate all employees with long commutes
B) Implement a mandatory remote work policy for all
C) Investigate causal factors behind the correlation
D) Exclude commuting time from overtime calculations
Correct Answer: C
Rationale: Correlation does not equal causation. HR must investigate why the
correlation exists (e.g., scheduling conflicts, burnout) before implementing
solutions. Analytical aptitude requires diagnostic inquiry before action.
8. A mid-sized company uses a digital self-service HR portal. An employee
accidentally views another employee's salary due to a system glitch. Under GDPR
principles, what is the company's primary obligation?
A) Ignore the incident as it was accidental
B) Terminate the employee who viewed the data
C) Perform a Data Protection Impact Assessment (DPIA) and report breach if risk
is high
D) Immediately delete the salary data of all employees
Full Diagnostic Assessment||Questions
And Answers With Rationales/Graded
A+/2026 Update/100% Correct
/Instant Download
Section 1: Core Knowledge & Foundational Concept
(Covers: HR Operations, Employment Law, and Total Rewards)
1. An organization is expanding into the European market. Under the General Data
Protection Regulation (GDPR), which of the following is
a mandatory requirement regarding the processing of employee personal data?
A) Obtaining verbal consent from employees for data storage
B) Transferring data freely across global servers without restrictions
C) Appointing a data protection officer (DPO) regardless of company size
D) Establishing a lawful basis (e.g., contract necessity) for processing
Correct Answer: D
Rationale: GDPR requires a lawful basis for processing personal data (e.g.,
performance of a contract, legal obligation). A DPO is only mandatory for core
activities involving large-scale monitoring. Verbal consent is insufficient, and
cross-border transfers are heavily restricted .
2. Under the Worker Adjustment and Retraining Notification (WARN) Act, which
scenario triggers the 60-day advance notice requirement?
A) A layoff of 25% of the workforce at a single site
B) A plant closing affecting 40 employees at a single site
C) A mass layoff involving 500 employees at a single site
D) A reduction in hours resulting in a 30% pay cut for 100 employees
Correct Answer: C
Rationale: WARN Act triggers include: (1) Plant closing with 50+ employees
losing full-time jobs, or (2) Mass layoff of at least 500 employees OR 33% of
,workforce and 50+ employees (minimum 50). Option C (500 employees) clearly
meets the threshold regardless of percentage.
3. A company wants to implement a "Pay Transparency" policy. Which federal
regulation primarily supports an employee's right to discuss wages without
retaliation?
A) The Fair Labor Standards Act (FLSA)
B) The National Labor Relations Act (NLRA)
C) The Civil Rights Act of 1964 (Title VII)
D) The Americans with Disabilities Act (ADA)
Correct Answer: B
Rationale: Section 7 of the NLRA protects "concerted activities," which includes
discussing wages and working conditions among non-supervisory employees, even
in non-union settings. Pay transparency policies are legally protected under the
NLRA.
4. In the context of the SHRM BASK®, the "People" knowledge domain primarily
focuses on:
A) Mergers and acquisitions strategy
B) Workforce planning and talent acquisition
C) Organizational compliance with OSHA standards
D) Corporate social responsibility initiatives
Correct Answer: B
Rationale: The People domain encompasses talent acquisition, total rewards,
learning & development, and employee relations. Mergers (Strategy), OSHA
(Workplace), and CSR (Organization) fall under different domains .
5. An employer offers a high-deductible health plan (HDHP). To comply with IRS
regulations for Health Savings Account (HSA) eligibility, what must the employer
ensure?
A) The plan covers all preventive care with zero deductible
B) The employee is not covered by a non-HDHP or Medicare
C) The employee earns less than the highly compensated threshold
D) The employer contributes the maximum out-of-pocket limit
Correct Answer: B
Rationale: To be HSA-eligible, the employee must have only an HDHP, no other
, disqualifying coverage (including Medicare or general purpose FSA), and cannot
be claimed as a dependent.
Section 2: 2026 Updates — AI, Technology, & Ethics
(Covers: Technology Integration, Data Analytics, and Ethical Practice)
6. According to the 2026 SHRM BASK® updates, when using AI in recruitment,
HR must prioritize which ethical standard to mitigate bias?
A) Proprietary algorithm secrecy
B] Algorithmic transparency and regular auditing
C) Elimination of all human review of applications
D) Restricting AI use to only external candidates
Correct Answer: B
Rationale: The 2026 updates emphasize responsible AI use, requiring transparency
in how algorithms make decisions and regular audits for disparate impact. Black-
box AI is discouraged .
7. An HR analytics team finds a strong correlation between commuting distance
and early tenure turnover. What is the most appropriate first step?
A) Immediately terminate all employees with long commutes
B) Implement a mandatory remote work policy for all
C) Investigate causal factors behind the correlation
D) Exclude commuting time from overtime calculations
Correct Answer: C
Rationale: Correlation does not equal causation. HR must investigate why the
correlation exists (e.g., scheduling conflicts, burnout) before implementing
solutions. Analytical aptitude requires diagnostic inquiry before action.
8. A mid-sized company uses a digital self-service HR portal. An employee
accidentally views another employee's salary due to a system glitch. Under GDPR
principles, what is the company's primary obligation?
A) Ignore the incident as it was accidental
B) Terminate the employee who viewed the data
C) Perform a Data Protection Impact Assessment (DPIA) and report breach if risk
is high
D) Immediately delete the salary data of all employees
