A dynamic phase model of psychological contract processes

• Author: Denise M. Rousseau,Maria Tomprou,Samantha D. Hansen
• DOI: http://doi.org/10.1002/job.2284
• Published date: 01 November 2018
• Date: 01 November 2018

SPECIAL ISSUE ARTICLE

A dynamic phase model of psychological contract processes

Denise M. Rousseau

1

|Samantha D. Hansen

2

|Maria Tomprou

3

1

Carnegie Mellon University, Pittsburgh,

Pennsylvania, U.S.A.

2

Department of Management, University of

Toronto Scarborough, Toronto, Ontario,

Canada

3

Human–Computer Interaction Institute,

Carnegie Mellon University, Pittsburgh,

Pennsylvania, U.S.A.

Correspondence

Samantha D. Hansen, PhD (formerly Montes),

Department of Management, University of

Toronto Scarborough, 1265 Military Trail,

Toronto, Ontario M1C 1A4, Canada.

Email: shansen@utsc.utoronto.ca

Funding information

SSHRC Insight Grant

Summary

In formulating a dynamic model of psychological contract (PC) phases, this paper

offers new insights by incorporating a temporal perspective into the study of the

PC. Although conceptualized as a dynamic construct, little empirical attention has

been directed at how PCs evolve and change over time. Moreover, conceptualization

of the PC and its processes has undergone limited revision since the 1990s despite

challenges to some of its tenets and advances in related fields that suggest the impor-

tance of time to such processes. In this article, we address limitations in existing the-

ory, clarify the conceptualization of the PC, and bring dynamism to the forefront of

PC theory building by emphasizing dynamic processes. We propose a phase‐based

model of PC processes (intraphase and interphase) wherein the functions of key var-

iables (e.g., promises, inducements, contributions, and obligations) change over time

and context. These phases include creation, maintenance, renegotiation, and repair.

This model directs attention to the dynamic nature of the PC, drawing on contempo-

rary evidence regarding self‐regulatory mechanisms. Finally, we present the implica-

tions of this dynamic phase model for theory and research.

KEYWORDS

affect, change, dynamics, psychological contracts, self‐regulation, time

1|INTRODUCTION

The obligations individuals believe exist between themselves and

others have profound effects on what they pay attention to or disre-

gard as well as how they interpret and react to cues from the environ-

ment (Rousseau, 2001). Extending early theorizing on employee–

employer exchanges (e.g., Argyris, 1960; Schein, 1965), Rousseau's

(1989, 1995) reconceptualization of the psychological contract (PC)

as an individual's beliefs regarding an exchange relationship has

become central to understanding exchange‐related obligations. The

PC construct has garnered considerable attention over three decades

with core issues including breach, violation, and fulfillment; contract

types; content; and process mechanisms (e.g., breach attributions).

Scholars have debated whether the PC reflects promises, expecta-

tions, obligations, or a combination of these and whether the PC rep-

resents an agreement between two or more parties (e.g., Alcover, Rico,

Turnley, & Bolino, 2017; Guest, 1998; Rousseau, 1998).

A major shortcoming in PC research is a lack of attention to psy-

chological processes over time. Although proposed to be a dynamic

construct (Rousseau, 1995; Schalk & Roe, 2007), much of the research

on PCs reflects only snapshots of the employee–employer relation-

ship, ignoring the tendency for actual exchange relationships, and

the PC itself, to change over time. This limitation is shared by numer-

ous domains in organizational research, motivating broad calls for

adopting a temporal lens (e.g., Roe, 2008; Shipp & Cole, 2015). Yet

despite the critical role of time in PCs, the literature is largely silent

on whether reactions to PC breach are immediate or delayed, tempo-

rary or permanent, or whether certain factors can speed the likelihood

of recovery. Such issues are crucial to organizational research and

practice, and thus, our primary goal is to provide a theoretical founda-

tion to facilitate the study of PC dynamics.

Following Rousseau (1989), we define the PC as a cognitive

schema, or system of beliefs, representing an individual's perceptions

of his or her own and another's obligations, defined as the duties or

responsibilities one feels bound to perform. As a schema, the obliga-

tion‐based beliefs comprising the PC originate from an array of

sources, internal (e.g., recalled experiences) and external (e.g., the

employment contract), and evolve over time. To aid in understanding

Received: 30 September 2016 Revised: 9 March 2018 Accepted: 12 March 2018

DOI: 10.1002/job.2284

J Organ Behav. 2018;39:1081–1098. © 2018 John Wiley & Sons, Ltd.wileyonlinelibrary.com/journal/job 1081

this evolution, we propose a phase‐based model of PC processes that

explicates key self‐regulation mechanisms (e.g., goals, affect, and feed-

back) that govern PC operation over the course of an exchange

arrangement. This model builds on past PC work and integrates schol-

arly advances, permitting new insight into PC dynamics over time. Our

dynamic model proposes the operation of four distinct contract

phases, creation,maintenance,renegotiation, and repair with interphase

and intraphase processes explaining how the PC changes actively and

passively over time. Although our model focuses on PC dynamics in

the employment context, it may be applied to other exchange con-

texts as well (e.g., among team members, customers, and suppliers).

Further, although our model explores change in employee PCs, it can

be adapted to other perspectives such as employer PCs with their

employees (e.g., Tekleab & Taylor, 2003) and team member PCs with

their peers (e.g., Laulié & Tekleab, 2016).

1.1 |Dynamic phase model overview

Figure 1 presents an overview of the phases and their interrelations

over time. Figures 2, 4, and 5 depict intraphase processes specifying

how the role key variables play can differ by temporal context.

1

Figure 3 depicts factors that influence the speed of interphase

transitions.

Briefly, upon organizational entry, newcomers enter the creation

phase, a time period in which preexisting beliefs regarding their own

and the employer's obligations are fine‐tuned based on environmental

cues from observation and interaction with the organization and its

members. When novel information dwindles and fine‐tuning

slows, the PC stabilizes and the individual transitions into the mainte-

nance phase. This phase reflects ongoing reliance on the PC (i.e., a

status quo) to guide the individual's interactions with the organization

(e.g., offering employee contributions such as in‐and extra‐role

performance in exchange for inducements delivered by the organiza-

tion such as developmental opportunities and support). Indeed, people

are typically motivated to fulfill their obligations to others (Castanias &

Helfat, 1991). This phase may last days, months, or longer depending

on the nature and stability of the exchange relationship. The employee

remains in maintenance unless a disruption occurs or they decide to

terminate their relationship with the organization due to a lack of fit

(e.g., Louis, 1980).

PC breach (a perceived negative discrepancy between employer

obligations and the inducements it provides) triggers negative

employee attitudes and behaviors (see Zhao, Wayne, Glibkowski, &

Bravo, 2007). In line with Zhao et al.'s treatment of breach as an affec-

tive event, we extend PC theorizing by proposing the related but

broader concept of PC disruption. Disruption is an affective event (Beal

& Ghandour, 2011; Fiedler, 2000; Weiss & Cropanzano, 1996) associ-

ated with either a positive or negative perceived discrepancy between

the PC and actual experiences. To “disrupt”is “to cause something to be

unable to continue in the normal way; to interrupt the normal course or

activity”(Merriam‐Webster's Dictionary, n.d.). As such, a disruption to

the PC generates an emotional response when an ongoing exchange

is interrupted. The valence of the associated emotional response indi-

cates whether the disruption is considered positive or negative, rather

than whether the discrepancy itself is positive (inducements surpass

obligations) or negative (inducements fall short of obligations). Thus,

our model focuses not on PC under‐or over‐fulfillment, but on the

valence of the affect associated with disruption. Generally, under‐

fulfillment or PC breach (a negative discrepancy) is associated with neg-

ative affect (Zhao et al., 2007). However, over‐fulfillment (a positive

discrepancy) has been associated with both positive and negative affect

(e.g., Montes & Irving, 2008). It is important to recognize that PC disrup-

tion can be either positive or negative depending on its associated

affect, thus better accounting for the range of circumstances that can

prompt positive and negative reactions to both PC under‐and over‐

fulfillment (Lambert, Edwards, & Cable, 2003).

We draw on self‐regulation theory (Carver & Scheier, 2001) to

identify how disruptions can result from a single event or an accumu-

lation of experiences over time. A disruption that triggers strong pos-

itive affect will transition the PC into the renegotiation phase; one that

elicits strong negative affect will transition the PC into the repair

phase. In either case, the individual engages in cognitive effort to

reduce or manage the discrepancy, which can include modifying per-

ceived employee and employer obligations and/or actual inducements

and contributions to facilitate a return to maintenance. Individuals will

FIGURE 1 Overview of psychological contract phases and their interrelations

1

Although the relations among key PC concepts are believed to unfold over

time, the relationships depicted in intraphase figures focus on intraphase predic-

tions only and are not intended to line up with relations in subsequent phases.

1082 ROUSSEAU ET AL.