The psychological contract is the perception -and this is the key word – of an employee of the mutual obligations they have with their organisation. These perceptions are influenced not just by the formal contract of employment (that would make things relatively easy) but by all the implicit and explicit promises made during his/her time at work.

Last week I introduced Jane to you, an employee who had being to lose their motivation at work, as she perceived that none of the promises the organisation had made to her were being kept. (If you haven’t done so already, click here to meet Jane.)

This perception of what someone should expect from their employer can start way before they actually begin their job: maybe during induction; maybe during the job interview; maybe even before they have had any contact with the organisation, as they read that advert in the paper that is calling out to them. But wait: there’s more.

Maybe their perceptions were shaped by what they experienced in their previous professional life, before even coming into contact with your organisation. And guess what: there’s more. Perceptions of what they should “give” at work in order to “take” might have even been formed by other aspects of their life, such as their family and the attitude to work amongst those surrounding them at an early age.

So you can see how complicated the human animal can be. By the time you begin induction of a new team member, they might have already worked out in their head what the organisation will deliver. Before we look at the role you might play in this, let’s turn back to Jane.

You might remember Jane saying: “In my interview, I was told there would be plenty of training opportunities.”

In fact, Jane’s conversation with Susanne, her line manager, went something like this.

Jane:
So do you think that people are able to progress in this organisation?

Susanne:
Sure – I myself started as a junior team member only five years ago. I was very aware of my strengths and weaknesses so I was able to focus on those things I needed to work on. I was lucky that a couple of vacancies came up at the right time in different departments – and being in the right place at the right time, I was able to move around the organisation quite a bit.

Susanne wasn’t lying. She wasn’t trying to impress Jane either. But Jane, instead of hearing just Susanne’s personal experience, heard that if you want to, in this company, you could work on your skills through training. That if you networked, you could move up in the organisation. Jane thought: “That statement about being in the right place at the right time is not really true, it’s who you know that counts and Susanne met many people as she moved around different departments. In any case, I’m sure Susanne will help me grow at work, she seems that kind of person.”

So, from day one, Jane thought that if she worked hard enough, in a few years time she’d be promoted or at least would be able to rotate throughout the organisation to improve her career prospects.

This didn’t quite happen. Sure, Susanna had a “how’s it going chat” with Jane three months into her job. Jane seemed happy, so Susanne didn’t even think of asking about her aspirations or expectations. When only six months later Susanne left, Jane felt betrayed as she had assumed that she would be working with her for a couple of years. When Laurence, the new manager arrived, he had to cut the training budget and put the new coaching programme on hold, as the financial state of the organisation was worse than it had been before. When the training budget was reinstated, it came with limitations. Training had to be directly related to the current job and not future aspirations.

So, what can we as managers, team leaders or general people-in-charge-of-others do to prevent the psychological contract breach?

We can encourage open conversations with our team members.
The psychological contract changes over time, as perceptions change, as new information is assimilated and so it is worth monitoring expectations.

Avoid making promises that you are not absolutely sure you can keep.
And as soon as you know you won’t be able to keep them, say so.

When recruiting, try to let the candidate talk to as many other people in the organisation, to allow them to get an accurate picture of their future workplace.

Similarly, find opportunities to enable communication between the new team member and others in the organisation early on, to help shape expectations.

Keep communicating with your team members, especially during times of uncertainty. When people receive ambiguous information, they will fill in the gaps themselves, increasing the chances of perceiving a contract breach.

Sometimes a perceived breach in someone’s psychological contract is difficult to avoid, as it is impossible to control how someone perceives the world. Different factors affect the likelihood of someone perceiving that the deal has been broken: how important the deal was to the employee;

Their previous experience in the workplace and with their previous managers;

Their current job prospects (if these are good, they are more likely to perceive a breach);

Understanding why the promise has been broken;

Perception of how much they are fulfilling their end of the bargain.

So, while sometimes there is little we can do to prevent a breach, there are actions we can take to decrease the negative emotions that might result from that breach. These emotions can manifest themselves  in behaviours such as cynicism, decreased commitment at work; lower job satisfaction, less “going beyond the call of duty” and even the desire to leave.  So the consequences resulting from a breach of the psychological contract can be considerable. They can even lead to organisational retaliatory behaviour, where direct harm is caused to the organisation or individuals in it.

Understanding the cause of the breach is important. If a real promise has been broken by you or the organisation, it is important to clarify why this has happened – the feelings of violation will decrease if the employee feels like they have been treated fairly and with respect and the breach was unavoidable.  By being as open and honest as possible, you might just begin to build trust again and avoid losing the loyalty and engagement of an employee.