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  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.com TABLE OF CONTENTS 1. Introduction.....................................................................................2 2. Phases in Psychological contract......................................................3 3. Consequences of broken psychological contract...............................4 4. How the psychological contract came into existence?......................4 5. Measurement of psychological contract............................................5 6. Bridging the Employee-employer Relationship..................................5 7. Impact of psychological contract.......................................................7 8. Conclusion.........................................................................................8 9. References.........................................................................................9Assignment Help – http://www.assignmenthelplite.com Page 1
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.com 1. Introduction: Psychological contract and the organizations“Psychological Contract” has become increasingly significant feature of workplace relationsand deeper human behaviour. It was first used in early 1960s but gained momentum afterthe economic downturn which occurred in early 1990s. It is defined as the perceptions oftwo parties, employee and employer and their mutual obligations towards each other. Theseobligations can be informal and imprecise. They can be inferred from the actions and fromthings that have happened in past, or from statements of the employer .Some of theseobligations can be taken as promises and „expectations‟. The more significant thing is thatthey are considered by an employee as a part of a employer- employee relationship.Therefore, psychological contracts are defined as the philosophy which the individuals holdabout the terms & conditions of exchange contract between them and their business groups.Primarily, Psychological Contract is the relationship involving an employer and employees,and distinctively concern joint expectations of inputs and outputs. This mentions theemployees‟ views in relation to what they look forward to from the establishment and alsowhat they owe to the organization. (Cullinane, 2006)Psychological contract is completely different from a legal contract .The latter in manycases, offers only limited representation of an employment relationship. On the other hand,psychological contract takes the reality of situation as it is perceived by the two parties.Hence, psychological contract is far more influential than a formal contract. It is thispsychological contract which efficiently tells employees what they should do to meet theirbargain and also, what to expect from their respective jobs.Simply, Psychological Contract balance between:  In what way, the employee is being treated by employer, and  What employee put into his job for the organizationAt the core, Psychological Contract is a philosophy and not a method, tool or formula. Thisreflects its significant and ever-changing dynamic nature. The method in which we define,understand and manage Psychological Contract, and apply the underpinning philosophy inour dealings - inside or outside the work - in essence defines our civilized outlook. Fairness,Assignment Help – http://www.assignmenthelplite.com Page 2
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comCompassion, trust, respect, empathy, virtues like these exemplify the true meaning ofPsychological Contract. (Ven, 2009)2. Phases in Psychological contractEarly phaseAs the psychological contracts deals with the employee‟s beliefs about mutual obligationsamid themselves and employers, it can be viewed as the grounding of employee-employerrelationships . Basically, individuals generally shape their outlook from two major sourceswhich includes their communications with their organisational representatives andperceptions of organisation‟s culture. In the “anticipatory socialisation,” at the time ofrecruitment, organisational recruiters and human resource professionals make detailedpromises to workforce about what could be expected from a organisation Secondly,employees‟ perceptions of organisation‟s culture and the standard functional proceduresshape the employees‟ viewpoint as regards to psychological contracts. Recruitment andearly years at the organizations shape the psychological contract of the employees.(DelCampo, 2007)DevelopmentIn first four to six months after becoming the part of organisation, the simple psychologicalcontract is brought to reality. According to a study, newcomers generally have anexceedingly positive view about the labour- employee relationship. Their preliminaryperceptions could be characterised by tall expectations towards their employer and lesserexpectations from themselves. As new employees gain more and more experience with theorganisation, they try get used to the environment and they settle their expectations closeto reality.DimensionsSpecific promises which are made by both the parties on commonly accepted promisesbased on the common obligations of employees and employers formed the basispsychological contract. Though, even if the organization has not made definite promises,every member of staff will welcome fairness, clarity, and good communication. On the otherAssignment Help – http://www.assignmenthelplite.com Page 3
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comhand, every employer appreciates employees doing good work and dealing with confidentialdata properly. In addition these common obligations, psychological contract are furtheraugmented with the written agreements which include employment contracts.There are number of things which affect the psychological contract in an organization.Firstly, the degree to which organization take on people management practices directlyimpact the psychological contract. Secondly this contract is based on workforce/ employeesense of trust and fairness and also on their conviction that the employer is honouring thecontract between them. Hence the business organizations where psychological contract ispositive, better employee commitment and satisfaction is there which have a positiveimpact on business. (Anon, 2010)3. Consequences of broken psychological contractIn all cases this psychological contract must be respected and if it gets broken then it couldimpact:  job satisfaction  commitment of an employee  Employee engagement.Hence the manger should understand that employment relationships between employer andemployee may deteriorate in spite of the management‟s best efforts. Hence it is better toprevent the breach than to repair the damage afterwards. In cases in which, breach can‟t beavoided it is better to negotiate.4. How the psychological contract came into existence?Changes in workplace are majorly responsible for it. These include:  More employees doing part-time work.  Organisations downsizing coupled with delivering  Technology, markets and products changing constantly.  Finance and technology becoming less worth-while than human resources  More fluid organizational structuresAssignment Help – http://www.assignmenthelplite.com Page 4
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comThe outcome of all these changes is that employees are widely recognized as main businessdrivers. The ability of businesses to add value lies on front-line employees or humancapital. Organizations who wish to be successful have to get most out of this resource. Inorder to achieve this, organizations have to know what employees expect from theorganization and their work. The psychological contract presents a framework for monitoringemployee priorities on these dimensions which tends to influence the performance.(Coyle,2007)The traditional meaning of the psychological contract is described as commitment by theemployee in lieu of job security offered by the employer. The continuing and increasingimpact of globalization have destroyed the basis of traditional deal as the job security is nomore there. The new deal is set on an offer of its fair pay and also on treatment by theorganization plus the opportunities based on training and development.5. Measurement of psychological contractA psychological contract could be measured by one of the following methods:1. Psychological Contract Inventory – these are the scales for the measurement ofShort term psychological contract. (This is basically a type of the transactional contract),Security (type of the Balanced contract), performance requirements contract (this is a typeof balanced contract), Loyalty contract (this is a type of relational contract), CareerDevelopment (internal and external) (This also is a part of the balanced contract),(Rousseau, 2000; vers.3).2. M_DOQ 10 i.e. MAJER_DAMATO ORGANIZATIONALQUESTIONNAIRE 10 – This isa test which takes into account 10 factors to get an idea about the employee‟s perception ofthe organization. These 10 factors include satisfaction. Development, Team, Autonomy, Jobdescription, Communication, Job involvement, Reward, Fairness, Leadership, Innovation;3. Quality System (ISO9000:2001) provides a scale to quantify the satisfaction of theemployees in a particular organization. The satisfaction level is calculated by a scale whichhas 6 dimensions that includes relation with others, general satisfaction, organisational andenvironmental features, training satisfaction, equipments available, professional role). AfterAssignment Help – http://www.assignmenthelplite.com Page 5
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comthis survey the coordinator also interview the employees on perception. After the analysis,all the data is given to a group and ultimately conclusions are validated by employeesthemselves as well by the coordinators.6. Bridging the Employee-employer RelationshipEvery organization has some responsibilities towards its employees. If the organization fulfilthese promises then it could lead to huge amount of employee satisfaction .Below are thesome of the promises made by the contemporary organization to its employees:1) Development of Career - Organizations should give all the possible opportunities tothe employees for their development within the organizations. Their efforts should berecognized and there should be ample opportunities for the promotion.2) Good Job Profile - The job offered by the organization should be challenging andinteresting. Job should not be monotonous and employee should be given continuouschallenges to preserve their interest in the job.3) Good work Culture – The organization should offer an environment with the goodworking environment. There should be good communication and cooperation within a group4) Good Compensation – employees of the organization should be offered an appropriatecompensation according the jobs they do. Incentives should be given for highachievements.5) Work and private life Balance- there should be proper understanding of the personalsituation of an employee and in some situations flexibility in working hours could beprovided. (Lars, 1996)Psychological contract in contemporary organization is a two –way role. Following are thekind of commitments which could help in bridging the employee- employer psychologicalcontract:Assignment Help – http://www.assignmenthelplite.com Page 6
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comEmployees EmployerHard Work Compensation in accordance with performanceUpholding the company reputation good training and developmentPunctuality Opportunities and promotionLoyal RecognitionFlexible An attractive packageHonest job securityInnovative safe environmentAccording to a research while organizations have de-layered and reduced the number of themiddle management posts many still continue to offer good careers and therefore mostemployees have adjusted the expectations o downwards. Many of them will be increasinglysatisfied if they believe and know that their organizations are handling issues about theirpromotion fairly.The recession had increasingly negative impact on the employee attitudes, especially withregard to job satisfaction and security. This suggests, managers will have to face greatchallenge to restore and maintain employee‟s commitment as corporate emerge from therecession. A positive psychological contract can greatly help as it supports a high level ofemployee involvement. However this concept of involvement goes beyond the employees‟attitudes and assets the need for managers to draw out the employees behaviour.Managers should manage expectations, through the fair systems of performancemanagement which accounts for regular employee appraisals. Good HR practicescommunicate important messages about what the organisation seeks to offer .Employeeattitude surveys are effective tool for exploring what employees think and feel about theorganization on a range of issues affecting them at the workplace. In times of rapid changessenior executives and employees hold different opinions. Two-way communication, formalor informal, is important to form a reality check and act as a basis for building the mutualtrust. (Guerrero, 2005)Assignment Help – http://www.assignmenthelplite.com Page 7
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.com7. Impact of psychological contractThe psychological contract may have the following implications  Fairness of Process: employees want to identify and understand that their welfare will be taken care when vital decisions are made. They would like respect and consequently they are more contented with their jobs.  Communications: an efficient two-way conversation between employer and employees is a compulsory means of giving importance to employee‟s „voice‟.  Management style: organisations managers can no longer manage business top down - they actually have to take up „bottom up approach. Critical information is known by employees from their communications with customers and suppliers.  Expectations managing: organizations need to make apparent to what the employees can expect from their job. Managing expectations is particularly necessary when bad news is probable.  Measuring attitudes: organizations should monitor employee attitudes on regular basis as it is a means to identifying where action is needed to improve the performance.Therefore, Breach of this psychological contract can critically spoil the employee-employerrelationship. It is not always possible to avoid a breach but damage is contained ifmanagers and senior executives are open with the employees about the issues which needto be addressed.(Mao, 2008)8. ConclusionPublic attention to psychological contract has been infused by uncertainties about jobsecurity. Organization should make certain that trust and faith remains with the workforcei.e. clarifying what is on the offer, honouring commitments, or if required explaining whathas gone wrong, and monitoring the employee attitudes on a habitual basis. Employeeengagement strategy can make available a useful structure for this point. (Feldman, 1999)Assignment Help – http://www.assignmenthelplite.com Page 8
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.comThe psychological contract does not provide a comprehensive model of employee/ workforceassociations but it offer key clues about how to uphold employee commitment. Amid thedecline in collective bargaining more attention is focused on dealings between theorganisation and the employee. The psychological contract reinforces the need for themanagers to turn out to be more efficient in communication and the consultation, whichhelps in adjusting potential and if required renegotiating the contract.The psychological contract offers a realistic foundation for soft HRM or behaving as asuperior employer. It offer a viewpoint based on insight from the psychology and also fromthe organisational behaviour rather than economics. It emphasises that the employment isa association in which the joint obligations of the employer and employees may be vaguebut have nonetheless to be respected. The cost of failing to fulfil or handle expectations maycause serious damage to the relations and to the organisation. (Thomas, 2001)9. References1. Coyle, S. (2007). The employee-organization relationship: where do we go fromhere? Human Resource Management Review. Vol 17, No 2, June. pp166-179.2. Cullinane, N. (2006). The psychological contract: a critical review. InternationalJournal of Management Reviews. Vol 8, No 2, June. pp113-129.3. Ven, C. (2009). The Psychological Contract; a big deal? Accessed on 14th August2010 from: http://www.internationalmta.org/Documents/2004/2004024P.pdf4. DelCampo, R. (2007) "Understanding the psychological contract: a direction for thefuture", Management Research News, Vol. 30 Iss: 6, pp.432 – 440.5. Anon, (2010). The psychological contract. Accessed on 12th August 2010 from:http://www.cipd.co.uk/subjects/empreltns/psycntrct/psycontr.htm6. Lars, K. (1996). Organizational employment versus self-employment. Accessed on11th August 2010 from : http://www.allbusiness.com/human-resources/594122-1.htmlAssignment Help – http://www.assignmenthelplite.com Page 9
  • HUMAN RESOURCE (HR) ASSIGNMENT SAMPLE Assignment Sample by: http://www.assignmenthelplite.com7. Guerrero, S. (2005). Measurement of the Psychological Contract in a French WorkContext. Accessed on 14th August 2010 from:http://papers.ssrn.com/sol3/papers.cfm?abstract_id=16353258. Mao, H. (2008). Evading Tactics of Psychological Contract Violations. Accessed on12th August 2010 from:http://www.ccsenet.org/journal/index.php/ass/article/viewFile/784/7589. Feldman, D. (1999). The impact of psychological contract violations on exit, voice,loyalty, and neglect. Accessed on 11th August 2010 from:http://www.accessmylibrary.com/article-1G1-55438376/impact-psychological-contract-violations.html10. Thomas, B. (2001). An Investigation Of The Relational Component Of ThePsychological Contract Across Time, Generation, And Employment Status. Accessed on 11thAugust 2010 from : http://www.accessmylibrary.com/article-1G1-74942455/investigation-relational-component-psychological.htmlAssignment Help – http://www.assignmenthelplite.com Page 10