Group organization management 2015 sherman 160 92

Although relatively few studies have investigated the influence of organizational factors in shaping the psychological contract, expressions of organizational policy e.g., Rousseau, 1995

Group & Organization Management

2015, Vol 40(2) 160 –192

© The Author(s) 2015 Reprints and permissions: sagepub.com/journalsPermissions.nav DOI: 10.1177/1059601115574944

of the emerging psychological contract in the new firm Arising from this, we advance several linked propositions to direct future research in this area Finally, we discuss the methodological challenges facing researchers seeking

to access employee–employer schemata and propose how some of these may be addressed

Keywords

psychological contract formation, review, schema theory, cognitive, methodology

1 University College Cork, Ireland

2 University of Limerick, Ireland

Corresponding Author:

Ultan P Sherman, School of Management and Marketing, University College Cork, Cork, Ireland

Email: ultan.sherman@ucc.ie

The psychological contract represents a central, if sometimes contested, digm in the analysis and understanding of exchange relationships With its roots in the work of the psychiatrist Karl Menninger, who, in his 1958 book

para-Theory of Psychoanalytic Technique, observed that an understanding in the

form of an unwritten contract developed between the interaction of the

thera-pist and patient during treatment, the term psychological work contract was

subsequently used by Argyris (1960) to describe the relationship between employee and organization and the ensuing effect each party has on the other Building on this idea, Levinson, Price, Munden, Mandl, and Solley (1962) refer to the psychological work contract as “a series of mutual expectations

of which the parties to the relationship may not themselves be even dimly aware but which nonetheless govern their relationship to each other” (p 21) Subsequent work by Schein (1965, 1980) also centers on these mutual expec-tations which operate “at all times between every member of an organization and the various managers and others in that organization” (Schein, 1980,

p 22) Since the 1990s, the psychological contract has acquired constructstatus resulting in a wave of theoretical and empirical work and a critiquing and maturing of the concept (e.g., Coyle-Shapiro & Kessler, 1998; Cullinane

& Dundon, 2006; De Vos, De Stobbeleir, & Meganck, 2009; Millward & Hopkins, 1998; Robinson, 1996; Schalk & Freese, 1997; Shore & Tetrick, 1994; Tomprou & Nikolaou, 2011; Turnley & Feldman, 2000)

Despite widespread research conducted on the dynamics of the contract itself (Conway & Briner, 2005), there are significant gaps in our knowledge around that actual formation process of the contract, which has largely been ignored in the extant literature Indeed, relatively little is still known about how it is created A number of reasons may be advanced as to why the forma-tion process merits further investigation First, a closer examination of how the psychological contract is constructed will facilitate an understanding of how it should be managed and developed Previous research suggests that at organizational entry, the new hire holds a rudimentary psychological contract that becomes more elaborate throughout their tenure with the organization (e.g., De Vos, Buyens, & Schalk, 2005; Rousseau, 2001; Shore & Tetrick, 1994) An assessment of this preliminary understanding of the exchange agreement can serve as a solid foundation to manage the relationship over time as it allows the employer to predict, in part at least, employee behavior throughout their stay in the organization Second, prior research has shown that a number of individual and organizational outcomes are associated with fulfillment (e.g., organizational citizenship; Turnley, Bolino, Lester, & Bloodgood, 2004) or breach and violation (e.g., knowledge guarding where individuals fail to combine and exchange their knowledge with others; Bal, Chiaburu, & Diaz, 2011) of the psychological contract The suggestion here

is that by addressing the psychological contract in its formation stage, the employer can increase (or decrease) the likelihood of desired (or undesired) outcomes such as organizational commitment and perceived person–environ-ment fit (Morley, 2007; Sturges & Guest, 2001).

Those studies that have examined the initial stages of the psychological contract have provided insights relating to antecedents of the contract itself, newcomer socialization, and the employee’s understanding of the obligations

of both parties Researchers have characterized the formation process as a period of information seeking (e.g., Rousseau, 1995; Thomas & Anderson, 1998) Both organizational and individual factors influence the creation of the psychological contract Although relatively few studies have investigated the influence of organizational factors in shaping the psychological contract, expressions of organizational policy (e.g., Rousseau, 1995), recruitment activities (e.g., Shore & Tetrick, 1994), and coworkers (e.g., Tomprou & Nikolaou, 2011) are examples of sources of work-related information that are likely to affect the formation process By contrast, the role that individual factors play in the process has received comparatively more attention in the literature A number of studies suggest that individual factors not only influ-ence how work information is interpreted but also determine what the employee is seeking from the employer For example, “work values” predict information-seeking behaviors (e.g., De Vos et al., 2005), “conscientious-ness” predicts a preference for a relational psychological contract (e.g., Raja, Johns, & Ntalianis, 2004), and “careerism” has been found to be associated with opportunities for development (Rousseau, 1990) and intention to leave (Hamilton & von Treuer, 2012) Studies such as these support the idea that individual predispositions influence how employees view their relationship with the employer as well as how they act within the framework of that rela-tionship (Coyle-Shapiro & Kessler, 2000)

Understanding how both parties “view” this relationship calls important attention to the conceptual lenses used to explore the psychological contract itself A number of competing frameworks have been advanced, each offering different insights on the contract’s dynamics Thus, social exchange theories have been proposed by a number of researchers as a useful exploratory tool (e.g., Coyle-Shapiro & Conway, 2004; Johnson & O’Leary-Kelly, 2003; Robinson, Kraatz, & Rousseau, 1994) These studies highlight how the rela-tionship between the employee and employer influences which obligations are exchanged (and not exchanged) Indeed, the social/economic divide inherent in exchange theory has informed the relational/transactional divide often explored in psychological contract research (Shore, Tetrick, Lynch, & Barksdale, 2006) A number of researchers have used “sense-making” theory

to help assess the psychological contract (e.g., Chaudhry, Wayne, & Schalk,

2009; De Vos & Freese, 2011; Morrison & Robinson, 1997) Again, these studies enrich our understanding of how employees interpret and respond to important episodes within the development of the psychological contract They also highlight the cognitive processing inherent in contract dynamics (Tomprou & Nikolaou, 2011) The other prominent cognitive framework put forward in the literature is “schema theory.” Arguably, schema theory is implied in Rousseau’s (1990) reconceptualization of the psychological con-tract, relocating it in the mind of the employee Schema theory is a potentially useful theoretical lens to assess the dynamics of the psychological contract as

it highlights how information is used when two parties are forming an ment Apart from Rousseau’s (2001) theoretical work, we have very little knowledge of how the psychological contract as schema functions (Taylor & Tekleab, 2004) As a result, we contend that there is a need for a deeper exploration of the cognitive underpinnings of the psychological contract To facilitate this exploration, we argue that schema theory represents an appro-priate point of departure to open new potential lines of enquiry in the follow-ing three areas:

agree-1 The shaping role of pre-employment experiences on the contentdimensions of the psychological contract;

2 The extent to which information emanating from organizational cesses and agents differentially shapes the formation of the psycho-logical contract; and

pro-3 The value in accessing the individual’s schema in facilitating a betterunderstanding of the psychological contract formation process.From our perspective, the field would benefit from these lines of enquiry

in two particular ways: First, it would contribute to our understanding of the specific terms of the psychological contract present during organizational entry (i.e., content dimensions) by identifying employee and employer obli-gations that have not received much attention in previous studies; second, it holds the prospect of offering further insights into how the psychological contract is likely to function and develop over time as the schema filters information as is required (Morrison & Robinson, 1997) Both of these areas have been identified by a number of researchers as underdeveloped areas within the literature (e.g., Conway & Briner, 2005; Coyle-Shapiro & Parzefall, 2008; Rousseau, 2001)

We contend that schema theory as a theoretical framework can add breadth

to our knowledge of the psychological contract formation process How ous employment experiences and sources of contract information shape the con-tract formation process can be better understood by considering psychological

previ-research on schemata The remainder of our article is structured around a sion of the three potential contributions schema theory can make to understand the psychological contract formation process (listed above) A number of propo-sitions are set down to help direct future research in this area.

discus-Section 1: Pre-Employment Experiences and

Psychological Contract Content

A schema is a mental model of conceptually related “elements” which directs how new information is organized (Stein, 1992) Depending on the meaning

or significance of this information, it is either assimilated into existing edge structures and the schema remains the same or the schema changes and

is reconstructed Either way, the schema provides individuals with a edge base that serves as a guide for the interpretation of information, actions, and expectations, thereby simplifying the process by which people make sense of events and situations (Bartlett, 1932; Lord & Foti, 1986; Engle & Lord, 1997) Rousseau (2001) asserts that how people make sense of these lower base elements creates a higher level of meaning For example, the con-cept of “wedding” is a schema developed by experience The wedding schema organizes and gives meaning to certain wedding features such as rings (more appropriate than a bracelet for this occasion) and rice (confetti rather than food) In this example, the rings and rice are the elements present

knowl-in the weddknowl-ing schema Withknowl-in the context of the psychological contract, the elements at the lower level of abstraction represent the content dimensions How these elements are interpreted reveals what the individual believes about the association between the employee and employer in terms of whether

it is governed more by a transactional or relational exchange Therefore, it is important to explore these base elements at organizational entry given that they influence interpretations of the new psychological contract

The content dimensions refer to the specific terms that constitute the ceived exchange relationship (Rousseau & Tijoriwala, 1998) They encom-pass an employee’s perception of the contributions he or she feels obligated

per-to make per-to the organization and the inducements he or she believes the nization is obligated to provide in return For example, an employee may be willing to take on extra work but only in return for future promotion opportu-nities The content of the psychological contract has received considerable attention in the literature (e.g., Herriot, Manning, & Kidd, 1997; Robinson

orga-et al., 1994; Rousseau, 1990) However, relatively few of these studies itly address the content at organizational entry (e.g., De Vos et al., 2009; Robinson et al., 1994) We do know however that the employee holds a rudi-mentary psychological contract in place at the beginning of their employment

explic-which Anderson and Thomas (1996) describe as an “imperfect schema.” This schema serves an important function at organizational entry for the new employee, guiding them through the early stages of the socialization process

It acts as a useful reference against which all future interactions with both the employer and the work group are assessed

By its very nature, this anticipatory psychological contract is subjective,

so the point at which it is first constructed depends entirely on the employee’s career history Herriot (1989) argues that an employee’s experience in previ-ous organizations shapes their understanding of the new employment rela-tionship With this in mind, the foundations of the anticipatory psychological contract of an experienced employee are likely to have been in construction for many years The inexperienced employee, on the contrary, will develop a schema largely based on information gleaned from their new organization given that they have little prior organizational experience on which to rely Thus, veteran employees tend to have more content dimensions in their psy-chological contract than novice employees (Rousseau, 2001), based on their level of work experience Veterans also have more accurate schemata than novices, and their anticipatory psychological contract will align more closely with organizational reality (Rousseau, 2001) Of course, not every employee will be motivated to perfect their pre-employment schema New recruits on temporary, short-term contracts will be very aware of the specific terms of their relationship with the employer given the clearly defined nature of their employment contract In these circumstances, the anticipatory psychological contract will be basic but unambiguous and will guide the newcomer’s inter-action with the employer

By categorizing new recruits into novices and veterans, Rousseau (1995, 2001) calls attention to the significance of experience as an antecedent of the psychological contract Indeed, it is the acquisition of new experiences that drives schema development The novice employee lacks work experience and has little or no history in a work environment Accordingly, their schema

is basic and is more predisposed to be reconstructed Therefore, the tion provided by the organization during the early stages of employment takes on great significance for the novice recruit (Bauer & Green, 1998) The veteran, however, has considerable work experience and significant history

informa-in a work environment For this reason, the structure of the schema and how

it processes new information are different for these employees Expertise facilitates the inclusion of new information into old knowledge structures Veterans with substantial expertise regarding their employment relationship are likely to have well-developed psychological contracts containing many elements These schemata are often more difficult to change because ulti-mately their structure is sophisticated enough to assimilate new information

Indeed, Dokko, Wilk, and Rothbard (2009) find that performance levels of veteran employees with prior related work experience deteriorated because

of the rigidities of their existing schemata The suggestion here is that ans can be too inflexible with new work practices Rousseau (2001) argues that veterans are less open to change than novices Novices however, have formed rudimentary schemata at organizational entry with fewer elements

veter-As such, novices are more open to change during this period, and their mata are likely to become more similar to those already inside the organiza-tion (Morrison, 1993; Thomas & Anderson, 1998) This line of enquiry indicates that level of experience may play an important role in how the schema functions when the psychological contract is being created

sche-However, previous work experience is much more than just a measure of time (Dokko et al., 2009) Rousseau (2001) highlights how new recruits can differ markedly in terms of their work history Therefore, the “type” of expe-rience a new employee has undergone is likely to influence perceptions of the new deal with the organization However, we still do not know whether pre-vious work experiences give rise to specific content dimensions of the psy-chological contract Evidence from the literature suggests this is likely to be the case

The two most relevant types of experience examined in the psychological contract literature are arguably, “violation” and “fulfillment.” Violation refers

to the belief that the other party has not upheld their side of the agreement Fulfillment refers to the belief that the other party has upheld their side of the agreement (Rousseau, 1995) The vast majority of this type of research takes the form of “in-role” studies (e.g., Cassar & Briner, 2011; Johnson & O’Leary-Kelly, 2003; Robinson & Rousseau, 1994) investigating both par-ties’ contributions to the exchange In contrast, we have a considerably weaker understanding of how previous experiences of psychological contract fulfillment or violation shape the new psychological contract The evidence

is largely inconsistent Therefore, for the purposes of this article, it is useful

to dichotomize psychological contract experience as “psychological contract violation” or “psychological contract fulfillment” (see Figure 1) Similarly, employees can voluntarily leave their employment (i.e., for a better opportu-nity in a new organization), or they can experience involuntary job loss through being made redundant Using these two categorization processes, we propose three distinct types of new recruits: (a) the laid-off employee (viola-tion and involuntary), (b) the employee who left voluntarily as a result of psychological contract violation (violation and voluntary), and (c) the employee who left voluntarily but whose psychological contract was fulfilled (fulfillment and voluntary) It is likely that each of these employees would hold very different pre-employment schemata upon organizational entry By

understanding their unique work experiences, we can make predictions about the content of their new psychological contract.

Psychological Contract Violation and Involuntary Job Loss

A number of studies suggest that employees who experience job loss and downsizing revise their career expectations (e.g., Csoka, 1995; Shore & Tetrick, 1994) A recent study by Eilam-Shamir and Yaakobi (2014) finds that employees who had negative experiences (e.g., layoffs) in previous roles were more likely to hold transactional expectations of their future employer than those who had not experienced difficulties However, it is worth point-ing out that this study speculates on the notional idea of a future employer In one of the few studies investigating the relationship between previous work experiences and the psychological contract with the current employer, Cavanaugh and Noe (1999) find no relationship between involuntary job loss and psychological contract content These two studies reflect the uncertainty

in the field We are still unsure to what extent negative experiences in a ous role shape the content of the psychological contract with the new employer Schema theory would suggest that a negative experience in a

Psychological Contract

as Schema

Previous Psychological Contract Violaon

Voluntary Exit Involuntary Exit

Previous Psychological Contract Fulfilment

Job Embeddedness in Previous Role Links Fit Sacrifice

New Psychological Contract Content Dimensions

Likelihood of symmetrical Likelihood of

Informaon

Key

Figure 1 A schema-based framework for understanding the psychological

contract formation process.

previous role is likely to affect expectations of the employee in the new role Indeed, Eilam-Shamir and Yaakobi find that new employees who have recently been laid-off are less willing to enter into a broader relationship with future organizations Accordingly, we propose that this type of employee will

be more tentative in their expectations of the new employer and what they will be willing to contribute in return

Proposition P1a: New employees whose previous psychological contract

experience is characterized by violation and involuntary job loss will report fewer content dimensions in the emerging psychological contract than their counterparts with no such experiences

Guest (2004) argues that loyalty and job security are no longer staples of the contemporary employment relationship given the economic uncertainty

of the past quarter century However, not every employee will experience downsizing in their career It is likely that an employee with a relatively set-tled work history will hold different expectations of a new employer in com-parison with an employee with a turbulent career path Previous studies suggest that employees generalize from particular experiences in one organi-zation to another (Andersson & Bateman, 1997) Specifically, the schema representing negative work experiences will influence perceptions of the new employment relationship Therefore, we argue that these employees will be less likely to expect job security in their new role and will feel under no obli-gation to remain loyal to the organization

Proposition P1b: New employees whose previous psychological contract

experience is characterized by violation and involuntary job loss will be less likely to report obligations relating to job security and loyalty in the emerging psychological contract than their counterparts with no such experiences

Psychological Contract Violation and Voluntary Job Loss

Of course, it would be impractical to address every reason behind an employee voluntarily exiting an organization for the purposes of this article Going back to the early work of March and Simon (1958), there are a multiplicity of reasons as to why employees voluntarily leave an organization, encapsulating perceived ease and desirability of movement, inducements, and extra- organizational alternatives perceived by the individual The motivation behind the move is likely to become the chief concern of the new psychologi-cal contract For example, an employee who leaves an organization as a result

of perceived lack of promotional opportunities in the organization is likely to pay particular attention to issues concerning advancement and career devel-opment in the new organization However, Pugh, Skarlicki, and Passell (2003) find that violation by one’s previous employer can lead to anxiety and cynicism that the new employer will also renege on the deal From a schema perspective, this finding suggests that experiences of violation become embedded in the schema and influence expectations of the new employment relationship, even with voluntary departures With this in mind, we build on the work of Pugh and his colleagues that mistrust of the new employer will lead to specific psychological contract content dimensions We propose that,

in light of the low levels of trust, these employees are more likely to create a psychological contract with the employer where employee performance is highly contingent on employer contributions (Rousseau, 2000) Specifically, they will expect high pay in return for good performance However, they will also be willing to work above and beyond the agreed terms but only in exchange for development and advancement opportunities

Proposition P1c: New employees whose previous psychological contract

experience is characterized by violation and voluntary job loss will be more likely to report employer obligations relating to pay and develop-ment opportunities in exchange for employee obligations relating to per-formance and extra role behavior in the emerging psychological contract than their counterparts with no such experiences

Psychological Contract Fulfillment and Voluntary Job Loss

While research has demonstrated that psychological contract violation is typical in most exchange arrangements (e.g., Robinson & Rousseau, 1994), not every employee will experience psychological contract violation Some employee departures can be attributed to external factors such as family responsibilities, ill-health, and so on From a psychological contract perspec-tive, therefore, the perception may be that the employer is fulfilling their side

of the agreement, but due to factors external to the terms of the contract, the employee voluntarily leaves the organization Again, there are myriad rea-sons behind a voluntary exit For our purposes here, we focus on that aspect

of the literature dealing with why people stay “Job embeddedness” is a tively new concept in the management field and may offer a way forward to explain the research problem It refers to the extent to which employees are

rela-“connected” to an organization (Mitchell, Holtom, Lee, Sablynski, & Erez, 2001) These authors propose a tri-dimensional view of job embeddedness

with each dimension explaining why employees choose to stay with an nization We will use this framework to assess the new psychological contract created by employees who voluntarily leave the organization even though their old psychological contract was being fulfilled.

orga-Mitchell and coauthors (2001) label these three dimensions as follows:

links (links to other people, teams, and groups), fit (perception of their fit with

their job, organization, and community), and sacrifice (what they say they would have to sacrifice if they left their job) With regard to links, the research

suggests that family links (Abelson, 1987), leisure pursuits (Cohen, 1985), and community links (Lee, Mitchell, Sablynski, Burton, & Holtom, 2004) are

all reasons as to why employees stay with an organization In terms of fit,

research indicates that identification with the organization and attachments to particular regions for cultural or religious reasons also predict tenure with the

organization (Mitchell et al., 2001) Finally, regarding sacrifice, research

suggests that the more an employee believes they are sacrificing in departing the organization, the more difficult it is to actually leave (Shaw, Delery, Jenkins, & Gupta, 1998) While comparable salary and benefits may be found relatively easily in new employments, the loss of established relationships with colleagues, ownership of challenging roles, the sense of having proven your worth to the organization and therefore improving advancement oppor-tunities, and so on, are often much more difficult to recapture All of these studies identify the prominent reasons why employees stay with organiza-tions and what would be lost upon organizational exit The dynamics of schema tell us that new employees are motivated to achieve similar experi-ences that align with the established schema (Rousseau, 2001; Shore & Tetrick, 1994)

The literature on job embeddedness discerns between “on-the-job” and

“off-the-job” embeddedness This distinction is useful for our purposes in advancing new propositions First, on-the-job embeddedness refers to the extent to which the employee is connected to the organization in terms of links with employees, managers, and other stakeholders; a fit with both the organization and the job itself; and the sacrifice of these relationships when exiting the organization From what we know about how the schema func-tions, we predict that an employee who voluntarily leaves a job where the psychological contract was fulfilled will seek to recreate a similar arrange-ment in the new organization Research on schema suggests employees who voluntarily leave the organization, though their psychological contract was fulfilled, are motivated to recreate the positive aspects of their previous job in their new employment (Lord & Foti, 1986) This finding would then suggest

a certain replication of content dimensions in the new psychological contract Specifically, they will look to the employer to help them establish new work

relationships, ensure they work on interesting and challenging tasks, and are given early opportunities for advancement In return, they will be more likely

to engage in organizational citizenship behaviors (Hulin, 2002)

Proposition P1d: New employees whose previous psychological contract

experience is characterized by fulfillment and voluntary job loss will be more likely to report employer obligations relating to network building, job content, early opportunities for promotion, and employee obligations relating to organizational citizenship in the emerging psychological con-tract in the new organization than their counterparts with no such experiences

Off-the-job embeddedness refers to the extent to which the employee is connected to the wider community in terms of links with friends, family, services, and so on, a fit with the institutional environment (e.g., religious practices if changing country), and the sacrifice of these connections and all they entail when exiting the organization While these aspects of job embed-dedness are outside the control of the employer, it is likely that the employee will expect the new employer to help reestablish these connections with the wider community Therefore, we propose these employees will expect from the employer a healthy work–life balance to facilitate the building of new connections and networks as a means of developing a broader social circle In return, they will feel obliged to be flexible with their time and to engage with their colleagues

Proposition P1e: New employees whose previous psychological contract

experience is characterized by fulfillment and voluntary job loss will be more likely to report employer obligations relating to network building and work–life balance and employee obligations relating to flexibility and team engagement in the emerging psychological contract in the new orga-nization than their counterparts with no such experiences

Section 2: Sources of Information and

Psychological Contract Formation

A number of researchers have called for a more expansive view of ents considered relevant to the psychological contract (e.g., Tomprou & Nikolaou, 2011) The antecedents of schemata (e.g., previous experiences) are fundamental to the psychological contract formation process As explained, the research broadly divides the factors that shape the psychologi-cal contract into two categories: (a) individual and (b) organizational

anteced-The individual antecedents of the psychological contract have received comparatively more attention in the literature than organizational factors (e.g., De Vos et al., 2005; De Vos et al., 2009; Purvis & Cropley, 2003; Robinson et al., 1994; Rousseau, 1990, 1995, 2001; Shore & Tetrick, 1994; Thomas & Anderson, 1998; Tomprou & Nikolaou, 2011) There are poten-tially an infinite number of individual characteristics that affect upon the contract itself (Conway & Briner, 2005) These studies illustrate how indi-vidual factors dictate the content of the psychological contract They also highlight how personal characteristics influence contract-related informa-tion-seeking behaviors Indeed, individual factors serve to create the schema through which individuals interpret their work environment (James

& James, 1989) As mentioned above, employees use schemata in very goal-oriented ways, and they search for information to “fix” an incomplete schema People automatically process and ignore information depending on its perceived value in attaining a goal (Stein, 1992) Rousseau (1995) argues that this selective perception and processing of information as a function of personal motivations influences employees’ perceptions of their psycho-logical contracts Therefore, individuals tend to seek out and focus on infor-mation that confirms prior cognition represented in their schemata, and they tend to avoid or ignore information that disconfirms them (Ashford & Cummings, 1983; Lord, 2000) This research illuminates the manner by which individual characteristics influence how the schema functions and, in turn, how it affects the interpretation of psychological contract-related information

While individual antecedents influence how the psychological contract is constructed, equally important to our understanding of this process is the role

of organizational factors To date, researchers have largely ignored how ferent sources of information shape the formation process The few studies that actually examine this relationship propose the organization influences employees’ psychological contracts through messages conveyed by multiple agents, organizational actions, and expressions of organizational policy (e.g., handbooks; Rousseau, 1995) Signaling theory highlights that individuals may receive both formal and informal organizational messages which can result in information asymmetry While this can happen throughout the entire lifecycle of their tenure with the organization, it is especially critical during the recruitment phase (Suazo, Martinez, & Sandoval, 2009) While we acknowledge that occasionally it can be difficult to distinguish between indi-vidual and organizational sources of information (e.g., a recruiter), for the purposes of this article, we are broadly categorizing these sources of con-tract-related information into two specific groups: (a) human resource pro-cesses and (b) organizational agents

dif-Human Resource Processes

The organization is the chief source of information for a new employee (Shore & Tetrick, 1994) Several scholars stress the importance of human resource practices as one of the major factors through which employees come

to understand the terms of their employment relationship (e.g., Grant, 1999; Guzzo & Noonan, 1994) A number of key human resource processes are likely to influence the formation of the psychological contract The literature often refers to these processes as “administrative contract makers” (Rousseau

& Wade-Benzoni, 1994)

First, human resource planning activities such as advertising the position, recruitment, and selection practices, and so on, are all thought to communi-cate important pieces of contract-related information That is, they all pre-sumably tell the new employee something significant about the forthcoming employment relationship Early psychological contract researchers such as Kotter (1973) and Schein (1980) have both described how employees and organizations exchange their expectations regarding the employment rela-tionship during the recruitment and selection stage This is an important epi-sode in the contracting process as it often represents the first meeting between both parties Second, much of the literature on the formation of the psycho-logical contract points to the early stages of organizational entry as critical to the creation process (e.g., De Vos et al., 2009; Thomas & Anderson, 1998) The formal processes associated with employee induction such as health and safety training, site tours, and so on, are all sources of codified, symmetrical information to which the new employee turns when making sense of the employment relationship (Guest & Conway, 1997) Often, literature accom-panying these processes is consulted by the new recruit such as handbooks, flyers, and so on These expressions of organization policy serve as useful references when forming early psychological contract expectations culminat-ing in what researchers have referred to as the “anticipatory psychological contract” (e.g., Anderson & Thomas, 1996; De Vos et al., 2009) It is useful

to think of this psychological contract as an imperfect schema which is fected” over time through the acquisition of new experiences inside the organization

“per-Characteristic to all these sources of information is the fact that they are more or less controlled by the organization, in the sense that the organization can dictate the content of messages communicated to the new recruit from these various sources (Conway & Briner, 2005) By and large, the human resource function is responsible for the codification and communication of the various human resource processes and procedures rolled out for new recruits Therefore, information provided at the beginning of employment

can be broadly sourced back to this unit For example, a new recruit who reads the employee handbook about the health and safety culture of the orga-nization will also be able to see artifacts of this culture on the site tour (e.g., safety equipment, protective clothing worn by staff) In this example, the organization decides what the new recruit is supposed to read and see at the beginning of employment For this reason, it seems likely that there would be relative symmetry and consistency in the information transmitted from this unit to the new employee Rousseau (2001) argues that consistent, explicit information emanating from clear sources allows the new employee to better understand the employment relationship.

However, even when drawing on these symmetrical sources of tion, not every employee will be motivated to make the effort to perfect their pre-employment schema Employees on temporary or short-term contracts often create a psychological contract based on specific, clearly defined terms (Dabos & Rousseau, 2004) They are less likely to be concerned with estab-lishing interpersonal relationships as a means of understanding organiza-tional reality (Millward & Hopkins, 1998) For these employees, it is extremely important that the contract-related information acquired is clear and consistent from the very beginning given the finite nature of their employ-ment relationship It seems likely that information gathered from the various human resource processes will take on additional significance for temporary employees and that they will rely heavily on these sources to create the psy-chological contract The employment contract is likely to be one such impor-tant information source designed by the human resource function The employment contract explicitly sets out the specific terms and conditions of the job (Conway & Briner, 2005) Temporary workers are likely to pay par-ticular attention to it when creating the psychological contract We propose, therefore, that contract-related information stemming from human resource processes will be more consistent than other sources such as from supervisors

informa-or mentinforma-ors and that symmetry would exist between the terms of the logical contract and the employment contract, respectively, for temporary employees

psycho-Proposition P2a: Contract-related information stemming from human

resource processes will be more consistent, clear, explicit, and cal than any other information source

symmetri-Proposition P2b: The content of the psychological contract of temporary

employees will more closely resemble the content of the employment tract when compared with the psychological contract of permanent employees

con-Organizational Agents

Beyond human resource processes, there are many agents active in the exchange of contract-related information In this respect, supervisors and coworkers are primary organizational agents who transmit messages to the employees at organizational entry (Shore & Tetrick, 1994) Our understand-ing of how these various agents influence the creation of the psychological contract is varied Rousseau (1995) argues that information originating from agents of the organization is often less reliable and less trustworthy, and the signals communicated to employees via these agents can be asymmetrical In terms of the supervisor, studies demonstrate that employees’ evaluations of the quality of the exchange relationship with their supervisor have an impact

on their assessment of the psychological contract (Lewis-McClear & Taylor, 1998) Similarly, Morrison and Robinson (1997) state that a high-quality leader–member exchange relationship facilitates communication between an employee and his or her supervisor, thereby reducing the probability of the perception of contract breach by the employee Newcomers’ psychological contracts will also be affected by coworkers through direct communication or

by monitoring what these coworkers receive, and how they are treated by the organization Louis (1990) proposed that coworkers provide information and cues which enable newcomers to cope with surprises, interpret events, and develop attitudes, opinions, and norms In this way, “organizational insiders” help in the socialization and acculturation of newcomers into the organization (Morrison, 1993)

These studies call attention to the sources of information used by the employee in the psychological contract formation process The suggestion here

is that each agent may communicate different messages to the employee arising from cognitive biases and other dispositional characteristics, albeit that some sources are perceived as more reliable than others (e.g., Lipton, 1977; Treadway

& McCloskey, 1987) For example, an obligation to work overtime is a typical dimension in many psychological contracts However, it is important to know how this was communicated to the employee Often, how the information is communicated is just as significant as the content of the message (Guest & Conway, 2002) Perhaps the recruiter, as a means of presenting a positive image

of the terms of employment, withheld this important piece of information from the employee, who, in turn, only learned about the overtime commitments from

a tenured colleague Such a scenario could have implications for the ment relationship in terms of trust between both parties

employ-Another important reason explaining the potentially inconsistent and able messages communicated by agents of the organization may be the influ-ence of affect caused by psychological contract fulfillment or violation A