Why is the Psychological Contract Important to the Organization?

The psychological contract can help both employee and employer to gain awareness on contemporary employment relationships; indeed, it has been debated that perceived obligations within the psychological contract are usually more vital to work related attitudes and behaviour than are the official and explicit elements of contractual acknowledgement (Grant, Branka and David 2010, 6-7).

When there is an agent employee to an employer relationship, obedience and loyalty are to be given to the employer almost fully, if anything completely. For example, when I go to apply for a job and upon signing a contract, the employer will only hire me, if I decide to give them complete

Contracts are an important part of everyday life. They are an essential part of business. As a student of a business law class, I will discuss in this paper several aspects of contracts. This paper will give a definition of a contract and the essential elements necessary to form a valid contract. It will briefly discuss breach of contract and the difference between a material breach and a nonmaterial breach of contract. Examples of legal and equitable remedies available for breach of contracts will be highlighted. Also, legal excuses for nonperformance or other grounds for discharge of contracts will be addressed. Finally, three types of common contracts personally and professionally encountered will be mentioned.

A negative psychological contract can lead to feelings of negativity and disengagement. If employee expectations are managed and their views and contributions actively encouraged and acted upon, engagement levels should improve.

An employment relationship is a linkage between employer and employees. Through this linkage a reciprocal relationship is built upon and when reciprocity is lacking it is detrimental to both employee and employer. It is this law of reciprocity, when someone does something nice for you; you do something nice in return that keeps American society maintained and running. Therefore, this theory of reciprocity is very important in today’s society when it comes to handling business. In Jeffrey Pfeffer’s journal article ‘Human Resources from an Organizational Behavior Perspective: Some Paradoxes Explained’, he discusses the pervasive distrust employees have with employers. In Daniel Pink’s book, Drive: The Surprising Truth about What Motivates Us,

From a work and religious perspective, when we work for a contract we usually receive that contract, if we

A contract is an agreement between two or more parties that the law recognises and will enforce in necessary. Contracts are essential to commerce and business and are also a fundamental part of our daily lives.Businessess inter into contract individuals, other businesses and governments to by and sell goods, services and intellectual property. Contracts can be written, verbal, express or implied. now many of the contract we enter into are verbal, because of this, many people are often unaware they are entering into legally biding contracts. many of the common law principles upon which contract law is based were developed in the 19th centuty, one of the principles that People intering a contract should have the right to include in it whatever they wish to negotiate the best possible bargain, complete freedom to contract. However, as modern life become more complex, it has become evident that not everyone has full and free options when entering into a contract, practical exemple of this include our dependence on services such as plumpedwater supplies, electricity

Recruitment and Selection are vital to the formation of a positive psychological contract, which offers the basis of administrative obligation and motivation.

For this study the authors gave five hypotheses. These hypotheses were related to the mediating roles of psychological contract fulfillment, need for change and trust. Trust being the only one included in three of the hypotheses. For hypothesis 1 the authors hypothesized that psychological contract fulfillment moderates the relationship of attitude toward change and change information, therefore change information is positively correlated to psychological contract fulfillment. Furthermore psychological contract fulfillment would be positively correlated to behavioral, affective, and cognitive dimensions of attitude toward change. For hypothesis 2 it was hypothesized by the authors that perceived need for change influences the relationship between change information and attitude toward change showing that change information and perceived need for change are positively correlated. Also that perceived need for change is positively correlated to the behavioral, affective, and cognitive dimension of attitude toward change. For hypothesis 3a, it was hypothesized that trust moderates the relationship between attitude toward change and change information, therefore there’s a positive correlation between trust and change information, and trust and the affective, behavioral, and cognitive dimension of attitude toward change. Furthermore, for hypothesis 3b, the authors hypothesized that trust affected psychological contract fulfillment in a positive way. Lastly, for

Limitations that could be identified in the study were the small sample size that included only managers, was conducted only in New Zealand and therefore may not be able to be generalized to other countries (Cable, 2010). Results and discussion suggests that future research could expand the understanding on how the fulfillment of the psychological contract could impact an individual employee’s attitudes and behaviors (Cable, 2010).

Behavior/contingency/performance contracts a written agreement between on individual and another individual outlining specific behavioral goals such as academic, personal goals and so forth. There are five crucial components of behavior/contingency/performance contract (Miltenberger, 2015). Behavioral contracting is an intervention that is relatively simple to implement, and when constructed effectively, can successfully induce changes in the individuals behavior. Furthermore, behavior contracts work in light of the fact that there is a public commitment (Miltenberger, 2015). The behavioral contract is a form of antecedent manipulation. Additionally, the contractee asserts in writing that he or she will participate in a particular target behavior

In order to have civilized interactions between people contract law is an invention that creates good faith and fair dealing. The United States people have a government that has a legal system that enforces agreements called contracts. An agreement without enforceability leaves the parties vulnerable to mistakes, dishonesty, changes of mind, illegality. Also, a contract means that the people can have reliability in their relations. People can have their problems remedied and damages made up for. Contract enforcement makes a more stable platform for businesses, making them more likely to do business and helping the economy,

Lester (2002) submitted that employees are likely to experience a diminished level of commitment, a decreased level of work performance, and they are likely to witness to the fact that their psychological contract had being breached. In addition, Conway & Briner (2002) stated that the psychological wellbeing of employees is likely to reduce when there is a breach in the psychological contract and as result, talent retention in an organisation will diminish (Tekleab & Taylor, 2003).

Critically evaluate the utility of the psychological contract for understanding the contemporary employment relationship. (2500 Words)

In every organisation or company where people work together, misunderstandings and agreements will occur. Sometime, conflicts often are hidden in a workplace, which has not been dealt with in an open way. These types of hidden conflict can lead to decreased motivation among the employees. So, in Management studies, they discuss conflict more in Human Resource way, it is all about motivations and relationship between people. Moreover, in Management, conflict between employer and employee is usually caused by Discrimination, which is also from Human Resource perspectives.