The Function of the Psychological Contract Sample Clauses

The Function of the Psychological Contract. The PC encapsulates a complex network of beliefs and feelings towards the employer, summarising the overall employment relationship from the employee’s perspective. Shore and Xxxxxxx (1994) claim that the concept plays three instrumental functions. Firstly, believing that there is an agreement between the individual and the organisation provides a sense of control and reduces feelings of uncertainty or ambiguity. The PC fills the gaps in the formal contract and keeps the employee engaged and responsive within the relation even when going through changing conditions. Secondly, the PC plays a self-regulatory function, enabling employees to work without direct or constant managerial surveillance. Awareness of what is expected to be accomplished or delivered allows the employee to manage their time, tasks, and priorities. It contributes to the employee’s feeling of autonomy and responsibility. This can have a positive impact on organisations, reducing costs of employee observation and micromanagement. Thirdly, the PC makes individuals feel that they can influence the growth and development of the relation. This relates to Xxxxxxxx’x (1995) concept of voluntariness, or what can be called the leverage of choice. If the employee feels that he/she can choose to perform obligations or not, they can put pressure on the organisation and negotiate terms and rewards. However, what function does the PC play when the employee feels that he/she has no choice? Xxxxxxxx and Xxxxxxxxx (2006) found that when FT employees are forced into a temporary employment contract, they go through a staged process and adjust to their new reality gradually. This finding may indicate that the role of the PC, in this case, is to xxxxxx accommodation and transition. In addition, the PC will motivate employees to regulate their effort and investment in the institution to compensate for the lack of choice. Many studies support the PC’s role in shaping a wide range of behavioural and attitudinal work-related outcomes. Based on a meta-analysis of 51 studies, Xxxx et al. (2007) found that PC breach is strongly related to mistrust towards management, job satisfaction, organisational commitment, and turnover intention. The same study showed a strong negative correlation between PC breach and both in-role performance and Organisational Citizenship Behaviour (OCB), in other words, extra-role performance. However, the study did not report a significant correlation between PC breach and actual turnover....
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