This report will illustrate the changes within the private sector under the influence of the recession, and how this has impacted upon the psychological contract.
The term psychological contract was first used by Agyris to describe the relationship between management employees in an industrial organization. In 1978, Schein defines the psychological contract as "a set of mutual expectations of the terms and conditions of a reciprocal exchange agreement between the person in question and the other party.Psychological Contract arises when one party believes that a promise was made to afuture reciprocity, it was a contribution and thus created an obligation to provide future benefits. "All these definitions conceptualize psychological contract as an exchange relationship between two parties, employee and employer, which starts to acknowledge that social exchange models, as they appear in March and Simon (1958) and Adams (1965).
Nowadays there is more and more emphasis on the career and position one holds within an organisation. Therefore one person looks up information on the organisation he seek employment from. A big percentage of this information is provided by the organisation itself. After obtain all the necessary information the person has already developed and overall impression about the organisation and has formed an idea about the values, the expectancies and the future career prospect the organisation can offer. Most of the times these expectancies are implemented by the organisations representative, contact person or interviewer, under the form of future prospects, salaries, development opportunities or future responsibilities.
On the other side the employer has a series of expectations form the one to be employed, such as loyalty, work standards, confidentiality, attendance, and adherence to the organisations values.
These mutual expectations, that are unwritten most of the times, constitute the term of “Psychological Contract... [continues]
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