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The main exploration of the impact of the psychological contract is reported in this chapter. It outlines the determinants of the psychological contract, taking into account factors at the individual, organizational, sector and country levels. The results show that, even after taking all these factors into account, temporary workers still report a more positive psychological contract. Turning to the consequences, we had hypothesised that the psychological contract would mediate the relationship between employment contracts and outcomes such as well‐being and performance. There is some evidence of mediation but it is often only partial mediation and even after taking into account the psychological contract, there is still evidence that temporary workers report more positive outcomes than those on permanent contracts.

The psychological contract, as reported by both employers and employees, provides the main focus of this chapter. It starts by reviewing some of the main conceptual and operational issues in exploring the psychological contract. Analysis reveals that both employers and employees agree that permanent workers have a broader content of the psychological contract than temporary workers. Initial comparison also suggests that there is some imbalance of the psychological contracts of temporary works who promise more than they get in return while employers admit that they do not always fulfil their promises and obligations, particularly to temporary workers.

The increase in flexible work has created interest in the consequences for workers. This has included concern about the potentially harmful effects of temporary employment contracts which are now widely used in many countries and which have been the focus of legislation within Europe. This introductory chapter sets out this context, and describes the aims of the study which are to examine the impact of temporary employment on the well‐being of workers, using the lens of the psychological contract. It provides an operational definition of temporary work and sets out the analytic framework for the research based on the psychological contract. The role of the psychological contract and other potential intervening variables is outlined and the concept of work‐related well‐being and ways in which it can usefully be operationalised is described. The structure of the book and the content of the subsequent chapters is outlined.

One of the distinctive features of this study is the opportunity to compare the responses of employers and employees. The aim of this chapter is to determine the level of agreement about the content and fulfilment of the psychological contract. A second aim is to determine whether higher levels of agreement are associated with more positive outcomes. The results reveal relatively modest levels of agreement about promises made, agreement being somewhat higher with respect to permanent rather than temporary workers. With respect to fulfilment of promises, there is a fair degree of reciprocity with both parties tending to report moderate fulfilment. Higher levels of agreement about promises made and fulfilled are not strongly associated with more positive outcomes; rather it is the measure of fairness that is more important in determining outcomes. This raises questions about the role of mutuality in the exchange at the heart of the psychological contract.

The psychological contract as a management tool was seen as a means of individualizing the employment relationship and, by making implicit beliefs explicit, it was felt that the psychological contract could be relatively easily controlled and managed. The psychological contract appears to be used by many organizations. Psychological contract surveys consistently show that employees report high levels of perceived promises, indicating that organizations could potentially benefit from successfully managing the psychological contract. This chapter discusses key issues in managing the psychological contract and offers suggestions for managing its two key areas: contents and breach. As most current recommendations for managing psychological contracts are from an employer's perspective, this chapter looks at what employees can themselves do to manage the psychological contract. The chapter concludes by considering some of the difficulties and dilemmas faced by employees and employers when attempting to manage the psychological contract.

This chapter unpicks the definition of the psychological contract by reviewing how it has been defined and identifying variations across definitions offered by researchers. Clearly, many concepts have multiple definitions and are used by researchers in different ways. Sometimes these different uses are broadly similar. In other instances, what researchers mean by the supposedly same concept can differ widely. In addition, there are situations in which definitions are so different they can simply confuse. For this reason, this chapter focuses on the key terms and features included in the definition of the psychological contract and discusses key debates. While this chapter is restricted to examining the psychological contract between employees and organizations, the idea of a ‘psychological contract’ as a system of implicit and explicit promises can be applied to other sorts of interpersonal relationships.

The contents of a psychological contract refer to the promises employees believe they have made to their organization and what the employees believe the organization has promised in return. In other words, it is about what is actually in the deal between the employee and their organization — what is exchanged for what, rather than the process of how the psychological contract operates. The contents of psychological contracts are important because forming certain types of deals with different sorts of contents is likely to lead to more or less positive employee and organizational outcomes, such as job satisfaction and job performance. This chapter explains what is meant by, and evaluates empirical support for, the contents of the psychological contract; considers the factors that form perceptions of promises and obligations; and examines how the contents have been categorized and related to outcomes.

This chapter looks at a number of key challenges facing psychological contract researchers that need to be addressed to strengthen psychological contract theory and make it more useful to practitioners. The challenges faced by psychological contract researchers cover a wide range of areas, including the definition of the psychological contract, psychological contract theory, and appropriate ways of researching the psychological contract. This chapter considers in more detail some of the definitional issues raised earlier and the conceptual problems they raise, and suggests ways in which aspects of the psychological contract concept can be clarified and developed. Six key six challenges are examined: what are the differences between expectations, obligations, and promises? What is meant by implicit promises? Are psychological contract beliefs only those shaped by the employee's current organization? What are the precise, specific links in the reciprocal exchange between employers and employees? Who, or what, do employees perceive to be the organization? Another important issue is how employees anthropomorphize the organization.

This chapter traces the history and development of the psychological contract concept. Two major periods are considered: the early history of the psychological contract up to but not including Denise M. Rousseau's seminal reconceptualization (1989). This period is characterized by rather sporadic theoretical development, the involvement of a number of different disciplines and subdisciplines, and limited empirical work. The second or ‘modern’ period concerns Rousseau's work and developments since that time. The final part of the chapter considers how researchers and practitioners are currently using the concept. Chris Argris (1960) was the first to apply the psychological contract to the workplace. He believed that employees and their organization created psychological contracts that allowed the expression and gratification of each other's needs. In other words, if employees feel that management is respecting their right to develop and grow and use their own initiative, then in return employees will also respect the right of the organization to evolve.

This chapter describes the main methods used to research the psychological contract and briefly considers their strengths and weaknesses. It examines the weaknesses of the questionnaire survey, the most common research method, along with other methodological and design limitations of typical studies in the field. The cross-sectional questionnaire survey is designed to detect associations between attitudes at a very general level and will be of little use in studying the occurrence, experience, consequence, and evolution of psychological contract content and breach. Daily diaries are proposed as an alternative approach that can be used to overcome many of the limitations of current research methods. This chapter then looks at a number of important areas of the psychological contract that have received relatively little research attention.

This chapter presents a case for considering the psychological contract as a process. First, it argues why we should study the psychological contract as a process and what we mean by a process. It then considers existing theoretical approaches and empirical studies examining the psychological contract as a process, along with their limitations. It presents qualitative data from a study illustrating the psychological contract as a process and offers two frameworks (self-narratives, sensemaking) that could be used to think about the psychological contract as a process. The chapter focuses largely on understanding psychological contract breach. The proposed frameworks could, however, also be applied to other areas such as ongoing reciprocation, negotiation, and development of psychological contracts.

Breach is probably the most important idea in psychological contract theory because it is the main way of understanding how the psychological contract affects the feelings, attitudes, and behaviours of employees. The power and flexibility of the breach concept are also demonstrated by the way in which it can be used to explain other concepts within psychological contract theory. Furthermore, psychological contract breach is seen as occurring relatively frequently at work because of the many factors that can affect the employment relationship. This chapter first defines psychological contract breach and distinguishes it from psychological contract violation. It then discusses how often psychological contracts are breached and considers the few studies examining the antecedents to breach. It examines whether breach always leads to negative outcomes or if the consequences of breach depend on other factors.

This chapter provides a brief summary and discussion of what has been achieved in relation to the three aims of the book: first, to provide a comprehensive review of psychological contract research and theory; second, to critically evaluate psychological contract research and theory and suggest ways in which the field can be further developed; and third, to consider how the psychological contract can be practically applied in organizations. This chapter considers ways in which research might usefully be developed. Some methodological and theoretical issues and empirical priorities are discussed. The chapter concludes by looking at the direction in which the psychological contract concept may be heading. The potential contribution of the psychological contract concept to understanding behaviour at work will never be known unless some of its fundamental limitations are acknowledged and addressed.

Why do people at work behave the way they do? As is evident from any organizational psychology textbook or course outline, a range of theories, models, and constructs are used to understand behaviour at work. Some approaches look to the organizational context or environment to explain behaviour. The job characteristics approach, for example, seeks to identify how particular features of jobs impact on employee behaviour. Other approaches look at the characteristics of individuals rather than the context to find ways of explaining behaviour. This book reviews and critically evaluates psychological contract research and theory, and considers practical applications of the psychological contract from an organizational psychology perspective. This perspective is similar to those found in other disciplines such as organizational behaviour and work psychology.

This chapter explores the contemporary character of white-collar jobs and argues that while there has been substantial corporate restructuring leading to a reduction in opportunities for promotion, predictions of the demise of the bureaucratic career are exaggerated. While the new flattened structures have provided novel opportunities for multiemployer careers for a select group of managers, they have also created problems of high staff turnover, low morale, and absenteeism. The competition for access to careers intensified due to the influx of women into professional and managerial jobs. These trends have radically ruptured the psychological contract between organizations and their employees about reciprocal obligations at work. Employers not only want their employees to be flexible and work harder but also to accept responsibility for managing their own careers. As a result, organizational loyalty has declined and people have come to view their careers in more individualistic terms. On balance, changes to the structure of organizations have been far more modest than changes in career identity and orientation.

The aim of this chapter is to look into individual and situational factors of attachment security to offer a relational perspective to explain why there are individual differences in employees’ proactivity and how managers and organizations can influence employees’ proactivity. The chapter firstly discusses how we can use the concept of attachment styles to explain individual differences in employee proactivity. The chapter than elaborates how an employee’s relationships with different targets at work (e.g., relationships with supervisors, work groups, and organizations) can influence her/his sense of attachment security at work and shape her/his proactivity at work.