The psychological contract and HR

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Why is the psychological contract important?

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In the end, a team member's daily work experience is not significantly impacted by their written employment contract with their employer.

In actuality, the contract is something you sign on your first day and then most likely don't see much of for the rest of your employment with the company. That contract might simply remain in a filing cabinet in the back of the office unless the employee and employer get into a legal disagreement.

The perceived fairness of the psychological contract that employee has with their company has a much greater impact on how they behave, act, and work.

Consider the psychological contract as any other relationship you may have in your daily life: it is a relationship.

It's simple for a friendship to deteriorate if your friend repeatedly disappoints you, asks for more from you than you ever give in return, or frequently makes you feel cheated. The other feels unfairly treated, and rightfully so, even though it may suit one of them.

However, a friendship that benefits from mutual support feels important and beneficial to both parties.

The same principles apply to a psychological contract between an employer and employee; for that relationship to endure over time, both parties must feel that their contributions are valued fairly and equally.

 

A balanced psychological contract

Team members who believe their psychological contracts are fair—meaning they receive the same amount of benefits as they do sacrifices—perform better at work, are more committed to the organization's goals, and are significantly more inclined to "go the extra mile" than other employees.

Employers must realize that each employee's definition of a balanced psychological contract will be different, and most importantly, that definition will evolve with time.

What appears to be a "fair" connection won't hold true throughout a person's career. Their needs from their employer will change as their life does.

For instance, many young workers frequently place a higher priority on career development prospects than employment security. That might very well be where their priorities are at that point in their lives. But that won't always be the case; later in life, job stability can become their top priority.

 

 

References


Location: Sri Lanka

Comments

  1. ChamindiApril 23, 2023 at 7:13 PM

    Psychological contract will change with age,social standreds and global changes with time to time. It would be varied from one to another . In HR the employer has to identity individual employees psychological condition and treat them

    ReplyDelete
    Replies
    1. SanjeewaApril 24, 2023 at 7:19 AM

      The psychological contract refers to the unwritten expectations and perceptions that employees have about the employment relationship, including their beliefs about what they will receive from their employer and what they are expected to contribute in return. It is a subjective and dynamic concept that can vary from one individual to another, and can be influenced by various factors, including age, social standards, and global changes.

      Delete
  2. Prageeth GamhewaApril 30, 2023 at 8:38 PM

    The psychological contract is a concept that captures the mutual obligations and understanding between an employee and their employer. It shapes the perception of how each party should behave based on expectations regarding the exchange of work and rewards such as salary and benefits. HR plays an important role in ensuring that this contract is respected and that employees feel valued and respected by their employer. HR can accomplish this through effective communication, training and development programs, and feedback systems.

    ReplyDelete
    Replies
    1. SanjeewaApril 30, 2023 at 11:25 PM

      Thank you, Mr. Indika, for your input.

      Delete
    2. SanjeewaApril 30, 2023 at 11:26 PM

      Yes, that's right. HR plays a crucial role in managing the psychological contract between employees and employers. They can help ensure that both parties have a clear understanding of their expectations and obligations, and that there is fairness and equity in the employment relationship. Effective communication and feedback systems can help identify and address any issues or concerns before they become major problems. Additionally, HR can create training and development programs that support the growth and development of employees, helping them to feel valued and respected by their employer. By managing the psychological contract effectively, HR can help foster a positive work environment, increase employee engagement and retention, and ultimately contribute to the success of the organization.

      Delete

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