Article written by: Denise M. RousseauPresented by: Katrina Keller
Denise M. RousseauProfessor:
Organizational Behavior and Public Policy – Heinz School of Public Policy and Management
Tepper School of Business, Carnegie Mellon University
Degrees earned from the University of California at BerkeleyA.B. in Psychology and Anthropology (1973)M.A. in Psychology (1975)Ph.D. in Psychology (1977)
Denise M. RousseauSubjects of study:
Psychological contracts between employees and employers
Human Resource Management Organizational culture, behavior, and theory
Books: Psychological Contracts in Employment: Cross-national
Perspectives (2000 with Rene Schalk) Psychological Contracts in Organizations: Understanding
Written and Unwritten Agreements (1995) Author or co-author of more than 10 books and 100
articles
Editor-in-Chief: Journal of Organizational Behavior from 1998-2007
What is a “psychological contract?”Exchange agreement between employees and
organizationPromisesPerceptions
Mutual expectationsEmployee performanceEmployee treatment
Violations to the psychological contractDefinition – Failure to comply with contract
termsVariable nature of psychological contract and
violationsEmployee interpretationsEmployer interpretations
Basic facts of contract violationCommonplaceAdverse reactions by the injured partyDoes not have to lead to break in relationship
Forms of contract violationInadvertent violation
Able and willing
DisruptionWilling but unable
Breach of contractAble but unwilling
Increased risk of violationLow trust and history of conflictDifferent lensesExternal pattern of violationsHigh incentives to breach and lack of
alternativesDifferent value placed on the relationship
Responses to contract violation
ExitResignationTermination
RemainVoice/Complaint Loyalty/ SilenceDestruction/Neglect
Responses continued…Low value on the relationship by the victim
ExitDestruction
High value on the relationship by the victimVoice/ComplaintsLoyalty/Silence
Shaped by organizational cultureComplaint vs. constructive criticismSupervisor/Manager relationships
Exit ResponseActive responseBreak in the relationship
TerminationResignation
Most likely Transactional contractOther potential jobs or potential employees availableBrief relationshipOther employees exitingPrevious violations go unresolved or failed solutions
Voice ResponseActive responseAttempts to remedy the violationFocus
Restore trustMinimize losses
Most likelyPositive relationship and existence of trustVoice channels existOther employees using “voice” responseEmployees belief they can influence compliance
What happens to unresolved voice?
Loyalty ResponsePassive response or no response
AvoidanceLoyaltyWillingness to endure or accept circumstances
Pessimistic vs. Optimistic loyalty responseMost likely
Ineffective voice channelsNo voice channels or established ways to
communicateLack of alternative opportunities
Destruction/Neglect ResponseActive response
DestructionPassive response
NeglectErosion of the relationship
Violations = End of contract?Pattern vs. Isolated eventViolator’s motivesViolator behaviorLosses incurredTreatment following violation
Reference 1Suazo, M. M., Turnley, W. H., Mai-Dalton, R.
R. (2005). The Role of Perceived Violation in Determining Employees’ Reactions to Pyschological Contact Breach. Journal of Leadership and Organizational Studies, 12 (1), 24-36.Referencing:
Morrison, E. W., Robinson, S. L. (1997). When employees feel betrayed: A model of how psychological contract violation develops. Academy of Management Review, 22, 226-256.
Psychological ContractBreach vs. ViolationBreach
Employee’s cognition that he/she has received less than promised (Morrison & Robinson, 1997)
ViolationEmotional state that may (but not always)
result from the perception of the psychological contract breach (Morrison & Robinson, 1997)
Survey 234 full-time employees
108 employees of a New Mexico County Government
126 professional participants of a PhD Project Conference (not PhD students)
41% Male, 59% Female46% Hispanic-American, 40% African-American,
14% White-AmericanMean age = 37Average organization tenure = 4.5 yearsAverage job tenure = 2 yearsSeven point scale with 1 = Strongly Disagree
and 7 = Strongly Agree
Survey Hypotheses - BreachPositively related to intent to quitNegatively related to professional
commitmentNegatively related to in-role job performanceNegatively related to the performance of
helping behaviorPositively related to psychological contract
violation
Survey Hypotheses - ViolationMediate the relationship between psychological
contract breach and intent to quitMediate the relationship between psychological
contract breach and professional commitmentMediate the relationship between psychological
contract breach and in-role job performanceMediate the relationship between psychological
contract breach and helping behavior
Survey ResultsAll hypotheses supported except:
Mediate the relationship between psychological contract breach and in-role job performance
Mediate the relationship between psychological contract breach and helping behavior
Breach drives the in-role job performance and helping behavior
Feelings/violation less importantPerception of breach itself more important for
behavioral responses
NoteSuazo, Turnley, and Mai-Dalton researched:
Exit response Destruction/Neglect response
Reference 2Turnley, W.H., Feldman, D. C. (1999). The
Impact of Psychological Contract Violations on Exit, Voice, Loyalty, and Neglect. Human Relations, 52 (7), 895-922.Referencing
Morrison, E. W., Robinson, S. L. (1997). When employees feel betrayed: A model of how psychological contract violation develops. Academy of Management Review, 22, 226-256.
Rousseau, D. M. (1995). Psychological contracts in organizations: Understanding written and unwritten ten agreements. Thousand Oaks, CA: Sage Publications.
Psychological Contract Violation ResponsesExitVoiceNeglectLoyaltyDo violations increase or decrease each
behavior?Do situational factors moderate employee
responses?
Situational Factors StudiedAvailability of attractive employment
alternativesJob marketOther options
Justification sufficiency of the violationVoluntary violationInvoluntary violation
Degree of procedural justice in the organization’s decision-making processIs the organization fair to all employees?
Causes of Contract ViolationsReneging
Incongruence
Survey804 managerial-level personnel
55% Male, 45% FemaleMean age = 35Average organization tenure = 7 yearsAverage job tenure = 3 yearsAverage salary = $49,000All were U.S. citizensResponse rate = 33%
Survey Continued4 samples:
213 recent MBA graduates 263 international business managers and graduates of
international business programs 223 managers and executives from a Fortune 500 bank
Recently undergone mergers and acquisition Widespread layoffs
105 employees from a state agency Restructured and reorganized in previous 2 years
16 specific elements of the psychological contract Personal ranking - Scale ranging from 1 (Not
Important) to 10 (Extremely Important) Organizational compliance – Scale ranging from -2
(Received much less than promised) to +2 (Received much more than promised)
Survey Hypotheses - ViolationsExit
Positively related to job search behaviorsVoice
Positively related to the amount of employee voice behaviors
LoyaltyNegatively related to an employee’s
willingness to defend the organization to outsiders
NeglectPositively related to neglect behaviors
Survey Hypotheses – Situational ModeratorsAvailability of Attractive Employment
AlternativesWill moderate the relationships between
violations and employee responsesExit, Voice, Neglect will be more likelyLoyalty will be less likely
Justification for ViolationWill moderate the relationships between
violations and employee responsesExit, Voice, Neglect will be more likely Loyalty will be less likely
Survey Hypotheses- Situational Moderators *Cont.Procedural Justice
Will moderate the relationships between violations and employee responses
Exit, Voice, Neglect will be more likelyLoyalty will be less likely
Survey ResultsAll violation hypotheses supportedAll situational moderators hypotheses
partially supportedExit & Loyalty supportedVoice & Neglect – Not fully supported
Survey Results ContinuedSample differences
Bank managers Lack of job security Compensation Experienced greatest levels of violations (with State
agency employees)State agency employees
Compensation Experienced greatest levels of violations (with Bank
managers)
Survey Results ContinuedSample differences
Recent MBA graduates Lack of job challenge (misrepresented amount of
responsibility, authority, or major tasks of job) Experienced lower levels of violations
International business managers Delays in obtaining promised overseas assignments Employers failed to keep committed level of support
they would receive when out of their home country
Most significant violations where restructuring and mergers had taken place
Survey Results ContinuedViolations were strongly related to:
ExitLoyalty
Less likely to experience negative consequences Typically occur outside of employment organization
Survey Results ContinuedViolations were less strongly related to:
Voice NeglectWhy?
Increased likelihood of negative consequences Occur at work
Exit is most consistently predicted response
NotesRefercence 2 used psychological contract
violation for all definitions. No distinction made between breach versus
violation.
Reference 3Pate, J., Martin, G., McGoldrick, J. (2003).
The impact of psychological contract violation on employee attitudes and behaviour. Employee Relations, 25 (6), 557-573.
Research Items“To what extent does psychological contract
violation impact both attitude and behavior?”Psychological breach vs. psychological
violationPsychological violation responses
DisappointmentFrustrationAnger
Organizational Justice“Fairness”Types of violations
Distributive violation Perceptions of unfair outcomes
Procedural violation Perception of unfair procedure application
Interactional violation Perception of trust towards managers and
organization
Attitudinal ResponsesReduced organizational commitmentReduced job satisfactionIncreased cynicism Break down in relationships
Behavioral ResponsesAbsenteesismReduced organizational citizenshipReduced effort
Company informationCollected over 3 yearsMid-sized textile company in BritainCompany over 200 years oldSignificant company changes from 1996-2000
Reduced workforce from 660 to 600 and looking to further reduce to 500 over 2 year period
New culture based on customer serviceIncreased focus on specialized trainingPlans to relocate 2 of the 4 facilitiesSale of 80% of company shares to Greek
family-owned company
Survey HypothesesTriggers of psychological contract violation
will result in a change in employee attitudeLower job satisfactionLower organizational commitment
Triggers of psychological contract violation will result in a change in employee behaviorReduced effortWithdrawal of citizenship
Psychological contract violation will result in increased absenteeism
Research MethodThree areas
Quantitative attitude survey Mailed to each employee at home address Response rate = 52%
Analysis of absentee informationQualitative interviews
Random sample 50 employees 45 minutes – 90 minutes in duration
Research Results - AttitudesJob satisfaction linked to
Distributive justice Procedural justice Overall enjoyment related to fair outcomes and
proceduresEmployee commitment linked to
Distributive justiceEmployee/Management relationship
Loyalty linked toProcedural justice
Research Results - BehaviorsEffort was not affected by any of the 3
defined triggersNo direct relationship between absenteeism
and violationsException in November 1998 – Psychological
contract breach occurred with sale of the organization
Only behavior linked was organizational citizenship (reduced initiative by employees to work “beyond the written contract”)
Overall AnalysisAttitudes were effected by violationsAttitudes do not necessarily equate to
behavior changes especially whenHigh job insecurityStrong relationships between coworkers Strong sense of pride of workEmployees see the organization and job as
separate