The Impact of Psychological Contract in Private Schools

 

Concept of Psychological Contract

A psychological contract is concerned with the perceptions of both parties to the employment relationship, organization and individual of the reciprocal promises and obligations implied in that relationship (Wangithi & Muceke , 2012). According to (Knights & Kennedy, 2005 ) a psychological contract as a set of individual beliefs or perception regarding reciprocal obligations between the employees and the organization.

Moreover, psychological contract can be defined as the existence of the psychological contract is the indicator of the employee’s commitment to the organization (Schalk & Roe, 2007). It has been proposed that psychological contract is a very important motivator for employees and if the responsibilities of the organization were neglected the employee trust and organizational commitment decrease while turnover rates increase (Buyens et al., 2005).

In a psychological contract as a set of obligations of individuals and organizations (Knights & Kennedy, 2005 ). The employee has expectations in the areas of promotion, pay, training, job security, career development and support with personal problems. In return the organization expects the employee to be willing to work extra hours, be loyal, volunteer to do non required tasks give advance notice when quitting be willing to accept transfer to refuse to support. Competition to protect company information (Wangithi & Muceke , 2012).   

Figure 1 Psychological Contracts "Iceberg" Model

 Source: (Naywinaung, 2014)

As private school teachers work on contact basis private school teachers seemed to perceive their employment relationship as more economical and less guaranteed (Cuyper et al., 2008).The private school teachers are possibility influenced by performance based factors such as, losing their job and not exceeding their specially limited obligations (Demirkasımoğlu, 2014).

Violation of Psychological Contract

Violation occurs when one party in a relationship perceives another to have failed to fulfil promised obligations. Since contract emerge under assumptions of good faith and fair dealing (Macneil , 1985). Violation of the psychological contract is distinct from unmet expectations and perceptions of inequity. Employees initially hold impractical expectations and when these expectations go unmet, employees may become less satisfied (Robinson & Rousseau, 1994). Expectancies are the perceived probabilities of outcomes resulting from employee behavior (Mitchell, 1974). Unfulfilled promises deprive employees of desired outcomes, an issue of distributive or outcome fairness. Often associated with perceptions of inequity. Violations also involve issues of procedural fairness, reflecting the quality of treatment employees’ experience (Robinson & Rousseau, 1994). Failure to honor a contract creates a sense of wrongdoing, deception and betrayal with pervasive implications for the employment relationship (Rousseau, 1989).

Violations decrease trust. When rules of friendship are violated, trust and respect decline (Davis & Todd, 1985). If the employer reneges on a promise, that employer’s integrity is questioned. Trust may be also lost in the employer’s motives because a violation signals that the employer’s original motives to build and maintain a mutually relationship have changed or were false to begin with. The violation of psychological contract results in a decline in willingness to contribute and intention to stay in an organization (Nelesh & Parumasur, 2014).

Types of Violations

According to (Robinson & Rousseau, 1994) there are different types of violations can be observed in organizations .such as,

·         Training / Development

Absence of training or training experience not as promised.

·         Compensation

Discrepancies between promised and realized pay benefits bonuses.

·         Promotion

Promotion or advancement schedule not as promised.

·         Nature of job

Employer perceived as having misrepresented the nature of the department or the job.

·         Job Security

Promises regarding degree of job security one could expect were not met.

·         Feedback

Feedback and reviews inadequate compared to what was promised.

·         Responsibility

Employee given less responsibility and/ or challenge than promised..

Psychological Contract on Employee Retention

The psychological contract is a concept plays a role in employees’ decisions to stay or leave (Turnley & Feldman, 1998).Employee retention practices are successful if they are in tandem with what employee value and consider when deciding to stay or leave the organization. There are many reasons why employee leave an organization. These include lack of challenging opportunities work schedule (Raja et al., 2004).

Employee retention involves taking measures to encourage employees to remain in the organization for the maximum period of time (Griffeth & Hom, 2001). Employees are difficult to retain because they give more importance for their career development rather achievement of organizational goals and being loyal to the organization develop to reduce voluntary turnover rates (Mitchell & Lee, 2001). Psychological contract is a construct of both scientific and practical importance and that it is especially relevant for Human Resources managers concerned with the retention of employees (Vos et al., 2006).   

 Conclusion

Psychological contract is not as simple as “work” and “pay”. Both employees and employer are expected to play their roles along with mutual understanding between the two parties. The organizations can achieve the panel goals if the psychological contracts proceeds well. Where the psychological contract is weak or violated it will pave the way for low performance and high turnover.

Psychological contract can be violated. Psychological contract violations are attend negatively associated with satisfaction, trust and employees’ intentions to remain with their employer and positively associated with actual turn over. During employee recruitment and selection the interview should clearly communicate the responsibilities and expectations of the employee since the establish meet of psychological contract begins during the hiring process.

Realistic job previews that contain a detailed description of relevant job aspects, including negative as well as positive features, will contribute to the formation of pragmatic psychological contract and reduce turnover (Knights & Kennedy, 2005). 

The leading international school which I work, one of the employee “inputs” of the psychological contract are being fulfilled by the teachers. Such as, effort, performance results, commitment and loyalty. If teachers can equipped with innovation, management, leadership and tolerance the institute will perform better and students will be benefitted.

Moreover, the school management maintains the employee “rewards” such as, security, training, safety, workplace, promotion, responsibility and respect, but flexibility, pension and ownership employee rewards are lacking. If the management can rectify the above weakness the organization will be strengthen for its smooth functioning.

References

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