Firms need a better understanding of their psychological contract with employees

psychological contractCompanies and employees are often acutely aware of the terms of their written employment contracts. The roles, responsibilities, working hours and salaries are clearly laid out for all to see. What is often overlooked, however, is that there is a second, hidden, contract within the employment relationship. This is known as the psychological contract. The psychological contract refers to the often implied, unwritten mutual expectations, beliefs and obligations between employee and employer. For example, an employee may take on additional work in the expectation that it will help to advance their career, or an organisation might expect employees to be more flexible in their working patterns during peak times. More →