Psychological Contract
Psychological contract is a concept created to describe the mutual expectations between employer and employee. It is an informal agreement made up in an individual’s mind. It describes the promises, rewards and obligations between the two parties.
In a way, the psychological contract influences the employee’s attitude towards work and their commitment level to the organization. It can also determine how employees feel about their job and their willingness to stay in the organization. It is important for employers to understand the psychological contracts since it is the basis of employer-employee relationship.
The psychological contract can be influenced by a number of factors. It is formed unconsciously by the individual itself and based on ones perception of the employer-employee relationship. It can also be shaped by past experiences each person has had with organizations. Apart from that, communication also plays an important role in forming the psychological contract.
Generally, employer’s promise to employees includes job security, salary, benefits, recognition, autonomy and many more. While expectation a employee might have includes good resources, professional growth, proper guidance and development, work-life balance and so on.
It is good to form the right psychological contract in order to ensure employees stay motivated and committed towards their job. Employers should take the time to consider the individual needs of the employees and create a psychological contract that is beneficial and satisfying to all parties involved.
Apart from that, having an effective and transparent communication is also important in maintaining the psychological contract. Employers should strive to create open communication and discuss expectations between both parties. Through this, there can be an alignment of expectations between the employer and employee, creating a harmonious and productive work relationship.
Improving the psychological contract is essential for organisations to retain talented employees. It is essential to create a positive and healthy working environment, with employees having trust, respect and confidence in their employers. As the psychological contract between employer and employee is mutual, both have to strive to create a positive relationship and become the best version of themselves.
To conclude, psychological contract is an important concept and it is essential for employers to understand how to create a fulfilling psychological contract in order to maintain a healthy and committed employer-employee relationship. It is important to ensure the expectations of both parties are mutually agreed and understood. Good communication and transparency helps to create a trust and understanding between employers and employees.
