Hrm: Psychological Contract

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Psychological contract
The characteristics of a psychological contract are the mutual beliefs, informal obligations, perceptions of the employee and employer towards each other; the expectations an employee has of the organisation and the expectations the organisation has of the employee and the reciprocal promises in that relationship. This helps to set out the aims and objectives in the company for the work to be done professionally. The employee has different contents and outputs for the business as to the employer. The employee seeks for fairness followed by an output of behaviour, whilst the employer seeks for trust and performance _(Annette Sharpe, 2004)._ There can be informal and imprecise obligations regarding the psychological contract, these obligations can be referred from current events or actions from the past, as well as from employee statements. An example of where these obligations may occur is during the recruitment process or in performance appraisals (CIPD, 2008). The important aspect about the psychological contract is that the employee understands and believes the relationship between the employers and the employees. An example of a successful company using the psychological contract in the right meaning is ‘Prêt a Manager’ which is a sandwich company that opened in the London in 1986, by two college friends, Sinclair and Julian (Prêt a Manager, 2008). The expectations that the employees can expect from Prêt a Manager are getting paid as much as they can afford, invest in people training and development, and most managers are promoted from within. The expectations that Prêt a Manager has from the employees are hard working, good sense of humour, enjoy delicious food, and start early to leave early (Michael Wellin, 2008). Prêt a Manager has successfully managed to build a great relationship with their employees using an effective psychological contract, which is one of the reasons why for the success of the company. Employing individuals from different backgrounds has made it possible for the business to make their shops feel more interesting for the customers and the employees (Michael Wellin, 2008) David Guest (2006) says that 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 expectation from both the employer and employee has to be met for work to be done efficient and for the future and success of the company. Guest, D shows a result of temporary workers regarding the psychological contract and states that there is a lower expectation of temporary workers, but better psychological contracts of temporary workers. The psychological contract is changing in ways of different expectations from the employees or the organisation. If the business identifies some negative effect with their aims and objectives or with the employees, there might be a change within the organisation. The employers might have a negative effect or a bad relationship with the employees, therefore can change the contents and the output criteria from the employers. The employees can believe or feel that the employers have not met their expectations and can effect on a negative job satisfaction. When the employers do not supply the employees as promised, there are negative effects within the organisation, and the ones to be held responsible are the managers, but not in all cases where the organisation might merge with another and staff has to be cut down. The changes over the years concerning the psychological contract are done to find the best possible way and suitable to manage any organisation and every individual company have its own way. In the 1970’s, the employee offers were loyalty, good citizenship and compliance, and after 20 years in 1990’s it had changed to flexibility, accountability, and long hours. Today, the offers are learning and clear added value, which...
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