HR experts are acquainted with contracts and in almost every organization, employers usually ask potential fresh staffs to sign at least one form or more. However, psychological contract is the only contract that is not signed. Hence, our major focus in this post is to explore the meaning and importance of a psychological contract.
What is the Psychological Contract?
As stated earlier, psychological contract Unlike a formal systematic employee contract, a is an unwritten type of contract or set of expectations between an employer and the staffs. This can be mutual beliefs, informal arrangements, and perceptions between both parties.
Importance of Psychological Contract
The importance of psychological contract includes the following among others.
Appropriate Communication
The psychological contract itself is not formal, it is often in a state of change. It is consistently evolving based on communication between the employer and the staff. So lack of communication can affect psychological contract negatively, therefore appropriate communication is very crucial in this kind of contract. The communication includes body language, voice tone, and even implication between both parties.
While the absence of effective two-way communication in the contract between employer and a staff can bring about a breach of psychological contract. Effective communication, on the other hand, can create a balanced contract which shows staffs that their employer values and respects them as well as finds their role within the organization as vital to aid holistic success. In essence, effective dialogue between an employer and the staffs can improve their loyalty for the company and motivate them to use their talent to promote and progress the goals of the company thereby leading to increase in productivity.
Contract Difference
The importance of a psychological contract as compared to a more formal contract is that it focuses on individuals. Every psychological contract is different because each staff is unique.
Individual psychological contracts allow the employee to see the quality of their role in the organization. It also assists both parties to keep away from generating expectations that are not realistic. It as well gives room for amending the terms and conditions of the contract through regular communication whenever the need arises. Meaning that the impact of diversity on psychological contract cannot be overemphasized, because it can create a huge influence on both the employer and the employees.
In a nutshell, in order to avoid a potential breach, the responsibilities of psychological contract are for both the employer and the staffs. For instance, the employer must ensure to give the staffs correct perceptions and to make sure promises are kept and the staffs, on the other hand, must handle their own expectations accurately so that personal circumstances or difficult situations do not impact productivity negatively. Putting the above information into consideration will assist to prevent a breach of psychological contract and to a balanced contract for both parties.
