Psychological Contract The Psychological Contract An individuals implicit

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Psychological Contract

Psychological Contract

The Psychological Contract • “An individual’s implicit belief in mutual obligations (expectations) between that

The Psychological Contract • “An individual’s implicit belief in mutual obligations (expectations) between that person and another party” (Rousseau, 1989) – Based on employees’ and employers’ perceptions of obligations • Unspoken • Continually shifting

Types of Psychological Contracts • Transactional – Short time frames – Specific obligations (e.

Types of Psychological Contracts • Transactional – Short time frames – Specific obligations (e. g. , financial) • Relational – Longer time frames – Diffuse obligations • Socio-emotional based (e. g. , commitment, affiliation)

Fulfilling/Violating Psychological Contracts • Fulfilling psychological contracts is associated with increased trust and cooperation

Fulfilling/Violating Psychological Contracts • Fulfilling psychological contracts is associated with increased trust and cooperation (e. g. , Conway & Briner, 2002). • Violating psychological contracts is associated with increased anger, frustration, and intentions to quit (Robinson & Rousseau, 1994). – Typical violations • Training • Compensation • Promotion • Job Security • People • When violated, contracts become more transactional and less relational

Managing Psychological Contracts Renegotiation under duress (new contract) Return to the way things used

Managing Psychological Contracts Renegotiation under duress (new contract) Return to the way things used to be (misunderstanding) Resentful termination Crunch Choice point Resentment, anxiety Ambiguity, uncertainty SHARING INFORMATION AND NEGOTIATING ROLE CLARITY AND COMMITMENT Planned termination Planned renegotiation STABILITY Ignore Pinch Choice point DISRUPTION OF SHARED EXPECTATIONS

Why is this Useful to Know? • Changing nature of the workplace: – More

Why is this Useful to Know? • Changing nature of the workplace: – More part-time and temporary contracts – Flexible job descriptions – Doing more with less (downsizing) – Constantly changing service standards – Constantly changing technology – Changing attitudes about work.

Application • Contract Content – Traditional Contract • Security for commitment – New Contract?

Application • Contract Content – Traditional Contract • Security for commitment – New Contract? • Fair pay • Fair treatment • Opportunity to develop – Younger generations? • • Work-outside balance Excitement Community Higher purpose • Increasing Employee Commitment – 3 dimensions of commitment • Affective • Normative • Continuance – Increasing commitment • • • Herzberg’s Theory Clear mission, vision, and values Fairness Communication (Listening) Management style Managing expectations