Layoff victim's employment relationship with a new employer in Korea: effects of unmet tenure expectations on trust and psychological contract

Existing studies of psychological contract have largely focused on the effects of contract breach on employees' attitudes and the contract itself involving the same employer. Given that both workforce mobility and downsizing activities are increasing, it is important to understand how individuals' past employment experiences shape their relationships with their employers. The present study focuses on the effect of prior layoffs on relationships with new employers. We posit that furloughed workers experience layoff as a breach of the psychological contract of job security they have entered into with their employer. Longitudinal data collected from individuals who were re-employed following a layoff revealed that unmet tenure expectations in an employment relationship result in reduced trust in a new employer, which in turn negatively impacts the quality of psychological contracts with the new employer. The results also show that the relationship between unmet tenure expectations and trust was moderated by individual attributions regarding the cause of the layoff. The present findings suggest that the negative impact of contract breach experienced with one organization may carry over to subsequent organizational contexts.     

How mass layoffs are related to lower job performance and OCB among surviving employees in Chile: an investigation of the essential role of psychological contract

This study aimed to investigate how mass layoffs impact surviving employees in organizations. More specifically, this study ascertained the relationships between mass layoffs and employee work behaviors. It was theorized that mass layoffs will be negatively related to employee performance and organizational citizenship behaviors (OCB) through its relationships with job insecurity and psychological contract breach. Moreover, it was expected that perceived manager support would buffer against the negative relations of contract breach with employee performance and OCB. A study among 615 employees in multiple Chilean organizations showed support for the hypotheses: job insecurity and psychological contract breach mediated the relationships between mass layoffs and employee performance and OCB. We also found moderating relationships of manager support, but the relations of breach with performance and OCB were particularly negative when manager support was high, indicating feelings of betrayal among high-support employees in response to contract breach. Moreover, the relation of contract breach with performance was positive for low-support employees, and non-significant for high-support employees. Our study advances understanding of the processes underlying how mass layoffs influence employee behavior in the workplace, through introducing the psychological contract as a way of understanding the relationships.     

Challenges to the psychological contract in Hong Kong

This study investigates empirically the psychological contract of a sample of 205 Hong Kong junior and senior managers. It determines the perceptions of factors that employers and employees see as relevant to the employment relationship, and then analyses perceptions of and attitudes towards recent changes in the Hong Kong business environment. In addition to exploring the nature and content of manager's psychological contracts in Hong Kong, the study explores how contracts are related to and affected by both the external environment and internal management practices. A survey questionnaire is used to measure the promises and commitments perceived to have been made by organizations, and the obligations that employees perceive they owe to their employer. In addition, the actual policies and practices of the employing organizations are determined. The impact of the HRM climate of the employing organizations (actual policies and practices) and the attitudes, expectations and feelings of organizational members about ongoing changes in the business and management environment on this exchange relationship are isolated. The study makes two contributions to the psychological contract literature: it examines the relevance of a psychological contract approach in a nonWestern geographical region; and it moves the concept of HRM preferences more centrally into the psychological contracting literature. This enables a better understanding of the construct in relation to the comparative management literature. The content of the psychological contract is shown to be multi-dimensional. Perceptions of organizational commitments and promises focus around four judgements: an intrinsically satisfying and challenging environment; a secure and rewarding job; equity; and supportive leadership. By Western standards the employee side of the employment relationship 'deal' is more one-sided. The proportion of managers who believe employees are strongly obligated to do certain things for their employers is very high. The study examines the factors that predict employees' psychological contracts. Actual HRM practices are shown to predict perceived commitments and obligations, and the strength of obligation is related to perceived promises and commitments. In contrast to the emphasis on the internal cognitive and individualized conception of the psychological contract in much of the literature, this study indicates that this decontextualizes psychological contracts. The true nature of a psychological contract is shown to be an exchange relationship firmly linked to a culture's reciprocity norms.     

Temporary contracts and employee effort

Temporary contracts provide employers with a tool to screen potential new employees and have been shown to provide “stepping stones” into permanent employment for workers. For both reasons, workers on temporary contracts have an incentive to provide more effort than permanent employees. Using indicators for unpaid overtime work and absences taken from the Swiss Labor Force Survey (SLFS), we present evidence that temporary workers indeed provide higher effort than permanent employees: Their probability of working unpaid overtime exceeds that of permanently employed workers by 60%. We show the heterogeneity of this effect across different types of temporary contracts, investigate differences between men and women, and discuss the relevance of endogenous selection into temporary employment.     

Ideological Currency in the Psychological Contracts of Corporate Manufacturing Employees

Previous research on employee psychological contracts has focused on three different types of expectations that workers have of their employers: transactional exchange of economic currency, relational exchange of socioemotional currency, and, more recently, covenantal exchange of ideological currency. This last type of currency, however, has been studied almost entirely in nonprofit workplaces among employees in helping professions (e.g., healthcare, education) who hold advanced degrees. Although not explicit in the extant literature, the implication of such is that expressions of ideological currency may be limited to certain types of professions. In the present study, we therefore analyzed both white and blue-collar employees’ ideological expectations in a corporate, for-profit, manufacturing environment. Using 1492 responses to an open-ended question received from an email survey, we found that 36% contained an expression of ideological currency, with an additional 44.8% possessing a possible expression of ideological currency. Comparisons of these expressions reveal many similarities between white and blue-collar employees within this organization as well as between these employees and those found in the published literature from workers in other industries. We discuss the implications of these findings for theory and future research.     

浅析订立劳动合同的技巧

劳动合同关系到合同双方当事人的切身利益,它也是劳动争议处理的主要依据之一,因此,不管是用人单位还是劳动者都应当掌握一定的劳动合同知识。文章主要从实际操作的角度,介绍一些劳动合同签订的技巧。     

Linking strategy and human resource practices: How employee and customer contracts are created

Organizations implement their business strategies through the human resource (HR) practices they use. These practices are major determinants of employees' psychological contracts. How employees interpret the terms of their employment impacts motivation, innovation, and customer service. This article describes four common types of psychological contracts in US firms and the HR practices that create them. It develops a framework for understanding how each contract shapes employee performance, retention, cooperation with fellow employees and customer responsiveness. It presents recommendations for more effectively managing the link between business strategy and the psychological contract of employees. © 1994 by John Wiley & Sons, Inc.     

The psychological contract in Chinese-African informal labor relations

This qualitative study analyzes Chinese-Ghanaian employment in trade as an example of South-South cross-cultural labor relations. Based on ethnographic fieldwork, employment practices and labor conflicts are discussed with regard to psychological contract and equity. The analysis is guided by a process model of psychological contract that has been adjusted and extended in consideration of the dimensions of foreignness and cross-cultural communication. After briefly introducing the situation in Ghana we elaborate that under conditions of foreignness, employment relations are conflict prone because of contradictory equity expectations of employers and employees. We discuss how Ghanaian employees perceiving their psychological contract as violated attempt to restore equity by means of voice, silence, retreat or destruction and often fail due to lack of mutual cultural understanding between employers and employees. We conclude that exit in contrast to expectations is a viable option for employers rather than employees, but most employment relations, though defective, are perpetuated.     

Human resource practices as communications and the psychological contract

This article examines the psychological contract and human resource practices as communications relevant to that contract. We argue that employees, at certain times only, systematically analyze their employers' HR practices for meaning vis-ri-vis their psychological contract. Judgments about the adequacy with which their psychological contracts are fulfilled result from such systematic analyses, and these judgments have important effects on employee commitment. Practical implications of our analysis are also discussed.     

Promoting Effective Psychological Contracts Through Leadership: The Missing Link Between HR Strategy and Performance

This article offers line managers and HR professionals an actionable, research‐based framework for developing psychological contracts with employees that suit their organizational and human resource (HR) strategy. Leadership styles supporting the firm's HR strategy are key to making psychological contracts that benefit both the firm and its members. When managers' styles are out of sync with HR strategy, this mismatch can lead to poorer performance through ineffective and unfulfilled psychological contracts with workers.     

A Discrepancy Model of Psychological Contract Violations

While previous research suggests that employees rarely believe organizations keep all of the commitments made to them, only in some cases do employees perceive these unfulfilled commitments as psychological contract violations and make active attempts to “get even” with their employers for the betrayal. This article presents a discrepancy model for understanding when employees will perceive unfulfilled commitments as psychological contract violations and for understanding when employees will respond in a hostile manner to those violations. Among other factors, the sources of employees' expectations, the specific contract elements on which discrepancies occur, and the magnitude and timing of the unfulfilled commitments are all posited as important contributors to perceptions of psychological contract violations. Then, individual differences, organizational practices, and labor market factors are examined as important moderators of how strongly employees respond to perceived psychological contract violations. The article concludes with directions for future theoretical and empirical research on psychological contract violations and employees' reactions to them.     

Can excess bring success? CEO compensation and the psychological contract

Strategic human resource management involves creating and maintaining employee skills as well as encouraging employees to perform at their maximum. Both require developing the appropriate psychological contract between the organization and the employee [Human Resource Management Review 8 (1998) 265]. This is no less true for the chief executive officer (CEO), who plays a major role in creating organizational culture. Trust is a critical component in the success of HR activities [Research Management Review 7 (1997) 389], yet the HR literature is relatively silent about how to encourage CEOs to perform trust-generating behaviors. Research on psychological contracts suggests that in order to encourage trust-based behavior, it is necessary to foster a relational psychological contract with employees [Rousseau, D. M., & McLean Parks, J. (1993). The contracts of individuals and organizations. In L. L. Cummings & B. M. Staw (Eds.), Research in Organizational Behavior (pp. 1–43). Greenwich, CT: JAI Press]. However, the generally recommended CEO compensation practice (pay-for-performance) often risks violating the CEO's relational psychological contract. Conversely, the practice of providing golden parachutes (much criticized in the press) helps uphold the CEO's relational psychological contract. Implications are discussed.     

Resource link: Re-establishing the employment relationship in an era of downsizing

This article examines AT&T's efforts to deal with force management issues by developing Resource Link^sm, an internal service unit that uses payroll management employees to help meet the variable work force needs of AT&T. Resource Link is discussed in terms of its contributions to increasing employment stability, improved learning, better governance, and helping to renew the psychological contract between employees and employers. The paper calls for future research in four major areas: skills development, teamwork, reward systems, and career management. It also addresses the potential applicability of this type of program to other firms. © 1995 by John Wiley & Sons, Inc.     

Employment protection and sickness absence

An exemption in the Swedish Employment Security Act (LAS) in 2001 made it possible for employers with a maximum of ten employees to exempt two workers from the seniority rule at times of redundancies. Using this within-country enforcement variation, the relationship between employment protection and sickness absence among employees is examined. The average treatment effect of the exemption is found to decrease sickness absence by more than 13% at those establishments that were treated relative to those that were not and this was due to a behavioral, rather than a compositional, effect. The results suggest that the exemption had the largest impact on shorter spells and among establishments with a relatively low share of females or temporary contracts.     

Least-cost alternatives to layoffs in declining industries

The demand for services provided by a telecommunications firm dropped sharply during the 1979 recession. The company had no history of layoffs. Because it was in a regulated industry and its rate-of-return was guaranteed, the firm was buffered from many of the usual uncertainties associated with declining demand. In spite of its secure position, history, and reputation, top management made a decision to respond quickly to the downturn and lay off 100 employees. Perhaps the layoffs were intended to be a symbolic gesture, since the number of people affected was very small relative to the total number of employees. If this was the company's intention, the impact was grossly miscalculated. Because of the unwise timing of the layoffs, they caused widespread disaffection. Employee morale and confidence in top management plummeted. The event gained in infamy, and in the corridors and washrooms of corporate headquarters it became known as the “Christmas Eve Massacre”.     

民营企业员工心理契约结构维度实证研究——以杭州地区为例

利用自行开发的心理契约量表,对浙江杭州地区民营企业员工心理契约内容进行实地调查,运用SPSS15.0统计软件进行探索性因素分析,结果表明:员工认为的"组织责任"有13项、"员工责任"有14项,其心理契约结构由"发展责任"、"基本责任"和"情感责任"三个维度构成。同时,对心理契约内部相互影响关系研究发现:企业承担的"情感责任"对员工责任的三个维度均有显著影响作用,说明企业充分尊重和信任员工,增进相互沟通和了解,有利于双方建立长期友好和稳定的关系。最后,总结了心理契约对民营企业人力资源管理的重要意义。     

心理契约对企业核心员工流失的影响分析

心理契约是存在于核心员工和企业之间的隐性契约,体现了员工与组织间责任义务的相互关系。物质报酬、环境、发展空间是影响核心员工流失的主要因素,心理契约通过其物质激励、环境支持、发展机会三个层面的满足与否对核心员工的流失产生重大影响。因此企业应重视核心员工心理契约的建立与维护,规范制度环境,满足核心员工的发展需要,从根本上降低流失率。     

Just laid off,but still a “good citizen?” only if the process is fair

Recent United States Congress legislation (the WARN Act of 1988) mandates that organizations must provide at least 60 days notice before a layoff of 50 or more employees can be instituted. As a consequence, individuals who are notified of their layoff often remain in their jobs for a significant period of time-and managers hope that these people will be good organizational citizens during thisremaining time. This article identifies different psychological factors that could explain why individuals would remain good citizens, even after notification of their impending termination. In a survey of 147 skilled employees who received notification of their layoffs, we found that the perceived fairness of the layoff process was the primary factor influencing their citizenship behavior. Additional analyses suggested that the perceived adequacy of the explanation of the layoffs, and whether the layoff victims were treated with respect and dignity, were the primary factors influencing the perceived fairness of the layoff process. The theoretical implications of these results are discussed.     

Better practices in managing layoffs

This article presents eight case studies that illustrate “better practices” in how layoffs are managed in organizations. These examples incorporate such policies and programs as early notification of layoffs, provisions for severance pay and extended benefits, education and retraining for displaced workers, outplacement assistance, clear and direct communication of layoff information, and support services for “survivors” of layoffs. These examples highlight the benefits of collaboration among downsizing businesses, public sector organizations, and unions in helping laid-off employees adjust to unemployment and obtain satisfactory reemployment.