Transcript The Psychological Contract

University of London
The Psychological Contract and
Good Employment Relations
David Guest
King’s College, London
Features of Contemporary
Employment Relations
• Unions sometimes marginalised at the
workplace despite legislation
• Rise in individualism/individual negotiation
• Greater concern for individual employment
rights – equal opportunities
• Blurring of boundaries of work eg location
• Management increasingly in control
• Emphasis on human resource management
• Persisting issues of trust and fairness
Some Reasons for Change in
Employment Relations
•
•
•
•
Workplaces getting smaller
Flexibility and fragmentation of the workforce
Pervasiveness and urgency of change
Feminisation of workforce and growing
interest in issues such as work-life balance
• Influence of American culture/individualism at
work
Rousseau’s Framework
• ‘Old’ IR
• ‘New’ IR
Idiosyncratic
Positional
Standard
The Need for a New
Conceptual Framework
• The traditional collective model is less
relevant in many workplaces
• Need a model that can accommodate rise in
individualism and flexibility
• Need a model that can address core issues in
the employment relationship of trust,
exchange and control
• The psychological contract can meet these
requirements
Reasons for Interest in the
Psychological Contract
•
•
•
•
Breakdown of the traditional ‘deal’
– A career in return for loyalty
– A fair day’s work for a fair day’s pay
– Loss of professional autonomy
Individualisation of the employment
relationship
Organizational change and violation
Search for new ways of managing
employment relations to meet the interests
and concerns of both employees and the
organisation
What is the psychological
contract?
The
Transactional
Deal
The
Implicit
Deal
The
Inferred
Deal
Defining the Psychological
Contract
“The perceptions of both parties to the
employment relationship, organization
and individual, of the reciprocal promises
and obligations implied in that relationship”
The state of the psychological contract is
concerned with whether the promises and
obligations have been met, whether they
are fair and their implications for trust.
The Psychological Contract
Framework
The Good
Employer
The High
Quality
Workplace
The
Deal
Satisfied
And
Productive
Workers
The Deal
Employer
Delivers on
Promises
Employees
Deliver on
Promises
Fairness
Trust
Commitment
Well-Being
Performance
Framework for applying the psychological
contract to the employment relationship
Contextual
and
Background
Factors
Individual:
Age
Gender
Education
Level in
organisation
Type of work
Hours worked
Employment
contract
Ethnicity
Tenure
Income
Organizational:
Sector
Size
Ownership
Business strategy
Union recognition
Policy
and
Practice
Psychological
Contract
State of the
Psychological
Contract
HR policy and
practices
Leadership/
Climate
Employment
relations
Quality of
workplace
Reciprocal
promises
and
obligations
Delivery
of the
deal
Fairness
Trust
Outcomes
Attitudinal
Consequences:
Organizational
commitment
Work satisfaction
Work-life balance
Job security
Motivation
Stress
Behavioural
Consequences:
Attendance
Intention to stay/quit
Job performance
OCB
The Good Employer
Progressive Human
Resource
Practices
The
Good
Employer
Climate of Positive
Organisational
Support
Flexible
Employment
Practices
Employee
Partnership
High
Quality
Workplace
The High Quality Workplace
• Reasonable demands/manageable
workload
• Some personal control over work
• Support from supervisors and
colleagues
• Positive relationships at work
• A reasonably clear role
• Involvement in changes affecting you
The State of the Psychological
Contract
Overall, to what extent has the
organisation kept its promises and
commitment to you?
%
fully
45
partly
49
not at all
6
The State of the Psychological
Contract
Do you feel fairly paid for the work you
do?
%
Yes, definitely
30
Yes, probably
30
No, probably not
19
No, definitely not
21
The State of the Psychological
Contract
To what extent do you trust your senior
management to look after your best
interests?
%
A lot
25
Somewhat
34
Only a little
23
Not at all
18
Exploring the Links
.40
Human
Resource
Management
Flexible
Practices
.12
.44
.08
High
quality
workplace
Effective
supervisory
leadership
.47
.12
Number
of
promises
.35
.37
.16
State of the
psychological
contract
Exploring the Links
cont…
Organisational commitment
.32
.28
State of the
psychological
contract
.13
.16
Job satisfaction
Work-life balance
.24
Life satisfaction
.19
Loyalty to supervisor
Excitement
.11
-.09
Organisational Citizenship
Intention to quit
The Employers’ Perspective
• Survey of 1306 senior UK HR managers
• 36% said they used the psychological
contract concept to help them manage
employment relations
• Senior managers acknowledge that the
exchange is not always fair – and favours the
employer
• Union recognition associated by managers
with a range of negative outcomes. More of a
hindrance than a help
The Policy Challenges
• Consider actively managing the psychological
contract as a means of maintaining effective
employment relations
• Recognise it is a two-way deal
• Address the outer context of human resource
management and employment relations
policy
• Address the inner core of “the deal” at the
local level