Taking a Closer Look at the Building Blocks of Psychological Contracts

[We’re pleased to welcome Ultan P. Sherman of the University College Cork. Dr. Sherman recently collaborated with Michael J. Morley of the University of Limerick on their article “On the Formation of the Psychological Contract: A Schema Theory Perspective” from Group and Organization Management.]

When I registered as a Ph.D student many years ago, my supervisor at the time (and co-author on this paper) Prof. Michael Morley tasked me with reading five articles on the psychological contract. The very first article I read was by Denise Rousseau (2001). In her seminal paper she discussed the schematic principles of the psychological contract. Fourteen years after this paper was first published it still surprises me that the building blocks of the psychological contract has only received minor attention from researchers. Both Michael and I felt that revisiting the ‘psychology’ of the psychological contract would facilitate a deeper understanding of how the contract is created. It is funny to think that the very first article I read has significantly informed this paper.

Many of us will recall feelings of anxiety on our first day of work. Often this anxiety stems from the fear of the unknown. To allay this fear, new recruits often seek lots of information as a means of addressing the unanswered questions we hold about our new job (i.e. what is my team like?, do we work late into the evenings in this firm?, etc.). Our paper argues that the information gathered at the beginning of employment is used to make sense of a new job and it is from this process that a psychological contract emerges. Of course, a new recruit will seek out and interpret information differently depending on many different biases and individual motivations contained in their schema. The schema filters new information in light of past work experiences and individual motivations. Therefore, by understanding the elements of the schema and how it functions, we can gain a deeper insight into how the psychological contract is created.

We hope that this paper will guide future researchers along new lines of enquiry into how the psychological contract is created. We all have very unique and idiosyncratic work experiences that influence our perceptions of each subsequent employment. Exploring this ‘baggage’ will allow us to better predict behaviour in and around the employment relationship. Similarly, we encourage future researchers to more explicitly examine how information is used by new recruits at organisational entry. From a practical perspective, it is in the employers interest to know what sources of information are used, and not used, by new recruits at the beginning of their tenure with the firm.

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Ultan P. Sherman is a lecturer in Organizational Behavior and Human Resource Management at the School of Management and Marketing, University College Cork, Ireland. His primary research interests lie broadly in the relationship between work and psychology focusing on issues such as the psychological contract, knowledge circulation and the meaning of work.

Michael J. Morley is Professor of Management at the Kemmy Business School, University of Limerick, Ireland. His research interests encompass international, comparative and cross-cultural issues in human resource management which he investigates at micro, meso and macro levels.