The Role of Psychological Contracts in Recruitment and Retention

1
The Role of Psychological Contracts
inRecruitment and Retention

• William H. Turnley
• Kansas State University
• Military Personnel Research Conference
• June 5, 2002

2
Introduction

• Recent Recruitment and Retention Challenges
• Strong economy
• Low unemployment
• Propensity of high school graduates to enter
  college
• Why study psychological contracts?
• Increasingly important in defining the
  employment relationship

3
Psychological Contracts

• consist of the beliefs employees hold regarding
  the terms and conditions of the exchange
  relationship between themselves and their
  organizations
• define what individuals expect to contribute to
  the organization and what they expect to receive
  in return

4
Prior Research on Psychological Contracts

• Has generally focused on two areas
• the changing nature of the psychological contract
  and the decline of mutual loyalty between
  employees and employers
• consequences of psychological contract breach on
  employees work attitudes and behaviors

5
Goals of this Research Project

• This research focuses on several issues related
  to the development and maintenance of
  psychological contacts
• how psychological contracts are formed (promises
  communicated by various sources)
• the extent to which applicants distort
  information about themselves in the recruitment
  process
• how the accuracy of information provided (by both
  organizations and individuals) impacts
  motivation, commitment, turnover, and performance
• how the attributions that individuals make when
  their psychological contracts are breached impact
  their reactions to such occurrences

6
Study 1 Brief Overview

• A longitudinal study that examines how
  psychological contracts develop during the
  recruitment process and the extent to which
  psychological contract fulfillment impacts
  employees attitudes and behaviors during the
  initial year of employment
• Approach
• Recently graduated university students were
  initially surveyed after having accepted a job
  but before they had started to work.
• These same individuals will be surveyed after
  they have completed their first year of work.

7
Study 1 Brief Overview (continued)

• Time 1 Survey (At hiring)
• Data collected on
• Implicit and explicit promises made by
  organizational agents
• How the promises were communicated
• The extent to which individuals distorted info
  about themselves
• Perceptions of person-job fit
• Time 2 Survey (Approximately 1 year later)
• Data to be collected on
• Extent of psychological contract breach
• Employment history (promotions, raises,
  transfers, turnover)
• Employee motivation, commitment, and performance

8
Study 1 Brief Overview (continued)

• Status
• Time 1 data has been collected from
  approximately 150 individuals.
• Time 2 data collection will begin later this
  summer.

9
Study 2 -- Objectives

• Examine Antecedents of Psychological Contract
  Breach
• Individual Differences
• Relationship Quality
• Supervisor-Subordinate Similarity
• Examine psychological contracts for
• African-Americans
• Hispanic-Americans
• Examine Consequences of Psychological Contract
  Breach
• In-Role Performance
• Extra-Role Performance

10
Study 2 - Procedure

• Approach
• Surveyed existing supervisor-subordinate dyads
• Samples chosen to provide access to
  African-American and Hispanic-American
  respondents
• Two Samples
• PhD Project Participants
• 138 respondents (29 response rate)
• 69 African-American, 31 Hispanic-American
• 62 Female
• County Government in New Mexico
• 109 respondents (25 response rate)
• 70 Hispanic-American, 30 Caucasian
• 57 Female

11
Model

• Individual
• Differences
• Psychological Performance
• Relationships Contract In-role
• Breach Performance
• Extra-role
• Similarity Performance

12
Antecedents of Psychological Contract Breach

• Individual Differences
• Affective Disposition
• Equity Sensitivity
• Relationship Quality
• Perceived Organizational Support
• Leader-Member Exchange
• Similarity
• Supervisor-Subordinate Demographic Similarity

13
Individual Differences

• Affective Disposition
• H1 Negative affective disposition will be
  positively related to the perception of PCB.
• - H1 supported.
• Equity Sensitivity
• H2 Benevolent individuals will be less likely
  than entitled individuals to perceive PCB.
• - H2 supported.

14
Relationship Quality

• Perceived Organizational Support
• H3 Perceived organizational support will be
  negatively related to the perception of PCB.
• - H3 supported.
• Leader-Member Exchange
• H4 In-group members will be less likely than
  out-group members to perceive PCB.
• - H4 supported.

15
Supervisor-Subordinate Similarity

• Relational Demography
• - Similarity Attraction Paradigm
• H5 Mixed gender dyads
• - H5 not supported.
• H6 Mixed race dyads
• - H6 only partially supported.
• H7 Age difference
• - H7 not supported.

16
Outcomes of Psychological Contract Breach

• Social Exchange Theory
• In-role Work Performance
• H8 Psychological contract breach will be
  negatively related to in-role performance.
• - H8 supported.
• Extra-role Work Performance
• H9 Psychological contract breach will be
  negatively related to the performance of
  organizational citizenship behaviors.
• - H9 supported.

17
Implications

• Individual personality differences matter
• Relationship quality matters at multiple levels
• Organizational level
• Supervisor-Subordinate level
• Supervisor-Subordinate relational demography
  generally does not matter
• However, the subordinates gender and race do
  matter
• Women and racial minorities are more likely to
  perceive pcb
• Both in-role and extra-role work performance is
  negatively impacted by psychological contract
  breach