Researchers have agreed that the term psychological contract refers to employee perceptions and beliefsabout the nature of the employment he/she is performing. These perceptions are created through cases of interaction between managers and employees, such as when the company states and communicates itsvision. Employees tend to regard them as promises and so, when the company fails to keep them it has a negative emotional consequence on them. So, to put it bluntly, employees base a great part oftheir expectation on the psychological contract and, therefore, when this psychological contract is violated, many bad consequences arise.
Although not all employees react the same way towards theseviolations, the normal response is the creation of a negative feeling amongst employees. For instance, characteristics such as mistrust, cynism, flourish and spread all around the organizationcreating a really bad working environment. Especially, when workers find that their jobs are at stake, reactions tend to be more severe. This general culture of mistrust goes against the organizationbasically in two forms:
1) Their level of satisfaction is negatively affected, and therefore their levels of performance.
2) In any change effort, commitment amongst employees is inexistent for thefollowing reasons: when the company wants to communicate its vision and why the change is needed, employees don’t trust them and when their effort is needed so as to implement the change they basicallydon’t do it. Moreover, if they think that this change may cause some redundancies, boycott may arise. So, leading a change process becomes an especially difficult thing.
The article regards job security,amongst others such as pay, as a major driver of employee’s satisfaction. This might be true to some extent, but this might depend on the type of job and the employee profile. So, when talking...