Tag Archives: psychological contract

3 CONTRACTS WITH YOUR EMPLOYER ?

In most cases one would say that one has only one employment contract with your employer, would you not ? Usually persons are referring to the legal document that you have to sign when you enter employment for a firm or an organisation.

By the way, please ensure that you have a written agreement when you start working for a company; although in some legal systems an oral agreement is just as valid as a written agreement, there are bound to be interpretative problems further in time, and as an employee you will almost always be the vulnerable party in the dispute.

foto: frank3.0 on flickr.com

A decent employer takes its staff serious and values its workforce as an important competitive asset; and a written agreement goes with it, although in some cases the finalization of a written version takes some time. That as a short deviation, but as a (former) legal counselor I had to mention this.

OK, back to the issue ! The legal contract is the contract in the regular sense of the word: “the employee has the obligation to fulfil certain agreed tasks and responsibilities and the employer has to pay a salary and other agreed benefits, as stated in the employment contract.”

Besides a legal contract there is also an economic contract – the employer buys the work efforts of the employee and has to pay a price for the labour. In this sense the employee sells his labour force to the employer.

And there is also a psychological contract, in the sense that both parties have certain expectations of each other, which starts already when reading a vacancy announcement in the newspaper or your first visit as an applicant. And from the employers’ point of view the application form or the moment someone walks into the door for the first time. As an employee you have your expectations on what working for the company in question would be like – and every encounter is unconsciously compared to these expectations.

A psychological contract is extremely powerful for the motivation and commitment of employee AND employer to maintain the relationship. For example, I have often started with high hopes working for a new employer, just to find after a few weeks (and then you still you doubt your own judgments) or a few months (and then you know for sure), that it is not as you expected it to be. Maybe my expectations were unrealistically high or my judgment during the application process was wrong or blurred ! In hindsight in most of the cases it was the fact that my ego was in the way: “if they want to have me, I must feel honored” and I did not check anymore whether the job was really what I wanted.

The lesson for myself: take a moment to step back – is this job really what I want and why not check whether the company’s reputation is as good as they say ? Your disappointment is also an employers’ disappointment; nobody gains if you enter an agreement on the basis of false expectations. In this sense the psychological contract is leading – if that contract is going sour it also has a negative impact on the economic contract and the legal contract. Let us try to avoid that !

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