What is a Psychological Contract?

An individual with a human resources degree may face the prospect of dealing with a psychological contract. A psych contract is a concept developed by an organizational scholar named Denise Rousseau. At the heart of the concept is a consideration of informal obligations, mutual perceptions, and mutual beliefs between employees and employers.

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Difference Between a Psych Contract and a Written Employment Agreement

There exist some major differences between a psych contract and a written agreement, according to Forbes magazine. The chief distinction between these two types of contracts rests in the reality that a written contract of employment is a formal work agreement and more generalized. A written employment contract delineates the general rights and responsibilities of the employer and employee.

Several factors dictate what will be included in the content of a psych content, a reality that must be understood by a person with a human resources degree. The management style of the employer is one such factor. Another is the type of profession of the employee that is a party to such an agreement. Another factor that impacts the content of a psych agreement is the stage an employee is at in his or her career.

5 Phases of a Psychological Contract


The first phase of a psychological contract is known as pre-employment. During the pre-employment phase, the initial expectations between an employee and employer are developed and established. These initial expectations are established via societal beliefs coupled with professional norms. Societal beliefs and professional norms are influenced in part by information gleaned about the organization itself. They are also impacted by the portrayal of occupations in the media.


Two-way communication between a prospective employee and employer underlies the recruitment phase of a psych contract. During the recruitment process, specific promises are exchanged between a prospective employee and employer. The initial set of promises set forth during the recruitment process can form the basic content included within the four corners of a written employment agreement that may be entered into between the parties. Moreover, these initial promises set the parameters for the future phases of a psych contract.

Early Socialization

During the early socialization phase of a psych contract, the parties carry on in their search for information about their counterparts. This includes seeking and obtaining data from multiple sources. Promises between the parties continue to develop. As is the case with the recruitment phase, these additional promises set parameters and provide guidance during the future phases of a psych contract.

Later Experiences

The next stage of a psych contract centers on later experiences between the parties after an employee has begun to establish his or her self with an employer. By this time, the exchange of promises between the parties has slowed down. At this juncture, some alterations to the psych contract may begin to occur. The reason alterations might be undertaken at this stage is because the promises and expectations are no longer theoretical.


The final stage of a psych contract is one in which an evaluation of what is happening between the employer and employee occurs. As an evaluation of the reciprocal agreement between the parties, proposed changes will start to come forth.

An organization and a person seeking employment benefits by understanding the attributes of a psych contract. A person with a human resources degree can enhance his or her own job performance with a keen understanding of a psychological contract.