The Psychological Contract

2666 Words11 Pages
Outline and critically evaluate the concept of the ‘psychological contract’. Why is an understanding of the psychological contract important to the management of the contemporary employment relationship? The ‘psychological contract’ is an increasingly important aspect within the contemporary employment relationship. Descriptions and definitions of the ‘psychological contract’ first emerged in the 1960’s, notably in the work of organisational and behavioural theorists Chris Argyris and Edgar Schein. Many other experts have contributed to the subject since then, and continue to do so. The ‘psychological contract’ was defined by Professor David Guest as ‘the perceptions of the two parties, employee and employer, of what their mutual obligations are towards each other’ (Guest, DE and Conway, N. 2002). Theorists created various models in an attempt to help explain the many aspects which make up and that can affect the ‘psychological contract’. These models include, ‘The Components of The Psychological Contract’ (Guest D. and Conway N 2004.) and the ‘Psychological Contracts Iceberg Model’ (Chapman, A 2010). The ‘psychological contract’ is however a deep and varied concept and is open to a wide range of interpretations and theoretical studies. As much of the theory surrounding ‘psychological contracts’ is intangible and difficult to represent in absolute measurable terms, Theorists came up with diagrams and models in order to make it easier to explain the various concepts of the ‘psychological contract’. One model that is useful in helping to explain the ‘psychological contract’ is ‘The Components of The Psychological Contract’ (Guest D. and Conway N 2004). The model is useful as it outlines the way in which the contract is shaped through various factors. These factors include organisational inputs (such as hr policies and practises), the behaviour and actions of
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