Managing the New Psychological Contract

2009 ◽  
pp. 640-648
Author(s):  
Benjamin Oyegoke Akinyemi
Keyword(s):  
Job Satisfaction ◽  
Psychological Contract ◽  
Employee Retention ◽  
Personal Values ◽  
Behavioral Responses ◽  
Employment Relationship ◽  
Organizational Success ◽  
Effective Management ◽  
Operating Environment ◽  
Employment Contracts

Employees have other expectations as an extension of what is usually expressly stated in formal, written or legally binding employment contracts. They (employees) develop perceptions about certain obligations which employers should fulfill in response to their contributions. This informal but normal employee expectation is known as the psychological contract. The effective management of the psychological contract in modern organizations has never been more crucial for managers. This is essentially because of the subjective and fluid nature of this concept, differences in personal values, and an accelerated pace of change in the operating environment of organizations. A good employment relationship creates an enabling environment for employees enhancing performance and productivity. It is also the bedrock of job satisfaction, motivation, commitment, citizenship behaviour, and employee retention. These factors are key determinants of organizational success and sustainability. A perceived breach or violation results in negative attitudinal and behavioral responses, whereas a positive psychological contract boosts employees’ morale. In this article, we explore the concept of the psychological contract, its changing nature, and effective management. Insight is given on managing the psychological contract to enhance the commitment, performance, and productivity of employees as well as continued organizational success in a constantly volatile environment.

scholarly journals Exploring the relationship between corporate social responsibility actions and employee retention: A human resource management perspective

2021 ◽  
pp. 1-13
Author(s):  
Hajar Boutmaghzoute ◽  
Karim Moustaghfir
Keyword(s):  
Job Satisfaction ◽  
Organizational Identification ◽  
Employee Retention ◽  
Employee Commitment ◽  
Theoretical Framework ◽  
Theoretical Research ◽  
Future Research ◽  
Behavioral Factors ◽  
The Relationship

BACKGROUND: This study builds on the little guidance in the existing literature to analyze the relationship between employee-oriented CSR actions and employee retention in a business context, while using Freeman stakeholders’ model as a theoretical research framework. This research also aims to shed light on significant behavioral factors facilitating the relationship between CSR endeavors and turnover rate. OBJECTIVE: This paper builds on the existing research gap in the literature and suggests that behavioral factors, including job satisfaction, organizational identification, and motivation facilitate the relationship between employee-oriented CSR actions and employee retention, which contributes to laying the foundations of a theoretical framework that has the potential to advance both theoretical and practitioner debates and disentangle the complexity of such a relationship, while offering strategically-focused development venues in CSR and HRM fields. METHODS: This research uses a single case study design to ensure an in-depth and detailed analysis of the phenomenon under scrutiny, while relying on a triangulation methodology for data collection, including a questionnaire used as exploratory approach, interviews to generate explanatory data, and archival data to bring confirmatory insights. Data analysis followed the procedures of a deductive approach. RESULTS: The research results show a positive relationship between employee-oriented CSR actions and employee retention, while demonstrating the facilitating role of job satisfaction, organizational identification, and motivation in moderating such a relationship. The findings also stress the importance of framing CSR interventions within the organization’s strategy and goals, while ensuring employee participation in such decision making processes to maximize the effect of CSR interventions on employee commitment and reduce turnover. CONCLUSIONS: This research has the potential to better clarify the nature of the relationship involving CSR interventions, from an employee perspective, retention, and turnover, while laying the foundations of a theoretical framework linking such constructs and other behavioral factors that underpin and support such a relationship. Building on the study’s findings and assumptions, future research is needed to gain a more comprehensive understanding of how HR-related CSR actions affect behavioral performance dimensions, resulting in employee commitment and retention. Future research should also consider multiple case study, multicultural, and ethnographic approaches for the sake of generalizability and theory building.

The impact of job security, job satisfaction and job embeddedness on employee retention: an empirical investigation of Pakistan’s health-care industry

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Attia Aman-Ullah ◽  
Azelin Aziz ◽  
Hadziroh Ibrahim ◽  
Waqas Mehmood ◽  
Yasir Abdullah Abbas
Keyword(s):  
Job Satisfaction ◽  
Health Care ◽  
Employee Retention ◽  
Health Care Industry ◽  
Job Security ◽  
Job Embeddedness ◽  
Public Hospitals ◽  
Content Type ◽  
Care Industry ◽  
The Impact

Purpose The purpose of this study is to determine the impact of job security on doctors’ retention, with job satisfaction and job embeddedness as the mediators. In doing so, the authors seek to contribute to the existing literature by providing additional empirical evidence on the links between job security, job satisfaction, job embeddedness and employee retention by using social exchange theory. Design/methodology/approach An empirical study was conducted on doctors working in public hospitals in Pakistan. Data from selected public hospitals were collected using semi-structured questionnaires. The simple random sampling method was applied for participant selection and partial least squares-structural equation modelling was used for data analysis purposes. Findings The findings confirmed the direct and mediation relationships. Thus, all of this study’s hypotheses are supported. The results indicate that job security can improve doctors’ retention. Further, job satisfaction and job embeddedness play crucial roles in mediating the direct relationship. Originality/value This study elaborates job security in health-care sector of Pakistan and also provides empirical evidence of the antecedents and mediators of doctors’ intention to continue working in the health-care industry.

scholarly journals The Role of Physiological Contract Breach on Employee Reactions: Moderating Role of Organizational Trust

2019 ◽  
Vol 7 (2) ◽  
pp. 233-244
Author(s):  
Sumaira Rehman ◽  
Shahzad Ali ◽  
Muhammad Sajjad Hussain ◽  
Aamir Zamir Kamboh
Keyword(s):  
Job Satisfaction ◽  
Organizational Behavior ◽  
Psychological Contract ◽  
Organizational Trust ◽  
Equation Modeling ◽  
Psychological Contract Breach ◽  
Contract Breach ◽  
Employee Reactions ◽  
The Relationship

Psychological contract Breach (PCB) play a crucial role to shape employee reactions (ERs) Therefore; this study investigated the possessions of Psychological contract Breach on employee’s reactions (organizational behavior regarding citizenship, job satisfaction) under the moderation of organizational trust. Data were collected from 340 employees of the Health sector by using the technique of simple random sampling. Confirmatory factor analysis (CFA) technique has been used to check the validity of the data while structure equation modeling (SEM) technique has been used for test the relationship between variables. Our findings revealed that psychological contract breach had negative and significant relationships with employees’ reactions (organizational citizenship behavior, job satisfaction). Further, organizational trust is also significantly moderated on the relationship between PCB and employees’ reactions (organizational behavior regarding citizenship, job satisfaction).

scholarly journals Developing Psychological Contracts of Justice in Improving Employee's Satisfaction at Perum Damri

2019 ◽  
Vol 3 (1) ◽  
pp. 55-75
Author(s):  
Akmal Akmal ◽  
Elfitra Azliyanti
Keyword(s):  
Job Satisfaction ◽  
Data Analysis ◽  
Intrinsic Motivation ◽  
Psychological Contract ◽  
Sampling Technique ◽  
Psychological Contracts ◽  
Actual Performance ◽  
Analysis Techniques ◽  
Employee Job Satisfaction ◽  
Reward Mechanism

This study aims to examine the predictors and consequences of a fair psychology contract. There are relationships between the degree of reciprocal trust and fair psychological contracts, reward mechanisms for fair psychology contracts, assessment of actual performance to a psychological contract of justice, intrinsic motivation to equitable psychology contracts, equitable psychological contracts on job satisfaction and Intrinsic motivation and Job satisfaction. The population of this study is 205 staff at Perum Damri Regional Division II and data was collected using a purposive sampling technique. The criteria of the respondents chosen were staff or employees who had worked in Damri's general company for at least 1 year. Data analysis techniques in research using software smart PLS 2.0 M3. This study contains 6 hypotheses and from the research, the results of reciprocal degrees of trust influence the fair psychology contract, but the progressive reward mechanism, the assessment of actual performance and intrinsic motivation have no effect. While fair psychology contracts and intrinsic motivation affect employee job satisfaction.

Fulfill psychological contract promises to manage in-demand employees

2015 ◽  
Vol 44 (5) ◽  
pp. 689-701 ◽  
Author(s):  
John Rodwell ◽  
Julia Ellershaw ◽  
Rebecca Flower
Keyword(s):  
Job Satisfaction ◽  
Psychological Distress ◽  
Psychological Contract ◽  
Organizational Identification ◽  
Equation Modeling ◽  
Employee Outcomes ◽  
Content Type ◽  
Psychological Contract Fulfillment ◽  
The Impact ◽  
Three Components

Purpose – The purpose of this paper is to explore the impact of three components of the psychological contract (i.e. obligations, fulfillment and breach) and the individual characteristic negative affectivity (NA) onto three key outcomes, namely, job satisfaction, organizational identification and psychological distress. Design/methodology/approach – Questionnaires were completed by 222 Australian nurses and midwives from a medium-sized metropolitan Australian hospital. The response rate for the study was 39 percent. Findings – Structural equation modeling revealed that perceptions of psychological contract fulfillment were positively linked to organizational identification and job satisfaction, while psychological contract breach was negatively linked to these outcomes. NA was negatively linked to job satisfaction and positively linked to psychological distress. Psychological contract obligations were not associated with any of the employee outcomes. Research limitations/implications – Psychological contract fulfillment is an important driver of employee satisfaction and organizational identification and the findings highlight the importance of including NA in psychological contract research. The occupation and context, being in-demand employees, appeared to neutralize the impact of one dimension of the psychological contract, employer promises and obligations. Practical implications – Explicitly managing employees’ psychological contracts by focussing on fulfilling realistic promises will enable managers to improve employee outcomes and facilitate employees embracing their organization. Originality/value – This study is one of the first to explore all three components of the psychological contract. These results may assist in the development of strategies to retain in-demand employees such as nurses, particularly highlighting the need to make and fulfill realistic promises.

Beaten Before Begun: The Role of Procedural Justice in Planning Change

2002 ◽  
Vol 28 (4) ◽  
pp. 497-516 ◽  
Author(s):  
M. Audrey Korsgaard ◽  
Harry J. Sapienza ◽  
David M. Schweiger
Keyword(s):  
Longitudinal Study ◽  
Adverse Effects ◽  
Procedural Justice ◽  
Psychological Contract ◽  
Planning Process ◽  
Strategic Change ◽  
Employment Relationship ◽  
Utility Company ◽  
Trust In Management

This investigation examines the potential adverse effects of planning strategic change on the employment relationship. We proposed that planning change can alter the psychological contract such that employees believe that organization obligations to the employee will diminish. We also argue that planning change may adversely affect employees’ perceived obligations to the organization, their trust in management, and their intention to remain with the organization but that such effects depend upon whether employees perceive the planning process to be procedurally just. We tested these hypotheses in a longitudinal study of a utility company undergoing reengineering planning. The findings supported the proposition that reactions to planning change depend upon perceptions of procedural justice in that employee obligations and intention to remain were only adversely affected by planning when employees perceived the process as unjust. Surprisingly, planning change did not significantly affect trust for employees who perceived the process as unjust and actually resulted in an increase in trust for employees who perceived the process as just. We discuss implications for practice and research.

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