Employment contracts are formal, written documents that outline the legal relationship between the employer and the employed. By its very nature the employment contract, as far as the employee is concerned, is very much ‘take it or leave it’. Some negotiation may be possible, but only around the fringes for the majority of people.
The psychological contract, on the other hand, describes the real relationship between employer and employee - and it's essentially a set of mutual offers and expectations. The employer will offer (for example) pay, training, and a good working environment; in return, it will expect certain outputs: reliability, flexibility and so on. The employee will also have offers and expectations. The offers could be skills, time, commitment; the expectations pay, security and fairness.
The psychological contract is rarely explicitly discussed. But it's a powerful motivating force behind our behaviour at work. And it's most clearly evident when the psychological contract has been breached in some way. As such, it's also a major reason for the recent rise in industrial action... [CONTINUED]
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Psychology at Work: Strikes, and the psychological contract