In this chapter, the concept of psychological contract which includes the definition of psychological contract, form of , characteristic of Thai context, focusing on the Bank of Thailand,
What is the psychological contract?
The psychological contract (PC) has been widely used in the analysis and exploration of employment relationships (Robinson, 1996; Guest, 2004). This term was originally used by Aryris in 1960, and it was further developed by Levinson et al (1962:20, cited in Roehling, 1997), who define the PC as,
"A series of mutual expectations of which the parties to the relationship may not themselves be dimly aware but which, nonetheless, govern the relationship to each other"
The original concept has been characterised as a 'classic definition approach', which is unwritten, implicit, and unspoken, and concerns the output of a relationship between employee and employer. Another approach: the 'Contemporary Approach', is influenced by Rousseau's work and is the most widely agreed upon definition of the PC at present (Conway and Briner 2005). Rousseau defines the PC as 'individual beliefs, shaped by the organisation, regarding terms of an exchange agreement between individuals and their organisation' (Rousseau, 1995, p.9). Rousseau's work radically changed the way we understand a PC and the way to do empirical research about it.
As stated by Conway and Briner (2005), the important characteristics of a PC, dominated by Rousseau, can be delineated by four aspects. First, the obligations are based only on perceived promises and not on expectations. Second, the classic definition considered the PC to include the perspectives of both the employee and the organisation (Herriot and Pumberton, 1997), which creates a problem of identifying the organisation's representatives (Arnold, 1996; Anderson and Schalk, 1998). Whereas, Rousseau proposed to shift from a bi-lateral to the unilateral relationship: on the perspective of employees (Anderson & Schalk, 1998). Third, Rousseau states that the PC is shaped by the individual's perceptions of the organization's and their own behaviours both in terms of explicit and implicit promises resulting from consistent and repeated behaviour by the parties to the contract, and believes that it is primarily an individual's perceptions of observable behaviour that forms the PC. As a result, it makes the PC quantifiable and readily researchable through traditional methods such as questionnaire surveys (Conway and Briner 2005). The fourth point, Rousseau's approach focuses on the idea of 'violation'which refers to failure of an organisation to respond to the employee's contribution that the employees perceive the organisation is obliged to do (Rousseau 1989).
Approaches to psychological contract analysis
There are three approaches to measurement of PCs, each emphasizing different points:
The content oriented approach examines the specific contract terms that are based on promises made by employers and employees. It can be measured from the perspective of employee, or employers, or from both (Rousseau and Tijoriwala 1998), but the employees' perspective is more concerned, and researched than those of employers.
The feature oriented approach examines the contract dimensions such as the extent to which the contract is implicit vs. explicit or stable vs. unstable over the period.
The evaluation oriented approach assesses the perceived degree of fulfilment, change, or violation, which is experienced within the context of the contract. (Rousseau and Tijoriwala 1998; Freese & Schalk, 2008).
Understanding the content of PCs is useful for managing employee relations in the organisations. As stated by a number of researchers (Conway 1999; Rousseau 1990; Robinson, Kratz&Rousseau 1994), if the organisations expect high levels of contributions (e.g. commitment, effort, citizenship behaviours) they need to establish a relational type contract. Herriot and Pemberton (1997) suggest there is a lot to lose if future PCs are managed so as to become more transactional. Millward & Hopkins (1998) found a significant positive correlation between relational contracts and job & organisational commitment and an expressed willingness to work overtime without pay. In contrast, a significant negative correlation was found between these measures and transactional contracts. Moreover, assessing the content of the PCs can answer a variety of research questions, including differences in contracts across organisational positions or roles, firms, or national culture (Rousseau and Tijoriwala 1998). Whereas focusing on evaluation of the PCs can help organisations to identify which contracts are being fulfilled or not, so that the organisation could focus or adjust the related factors, and manage the employee relations in the organisation in the better way. The assessment of the PC content and state is delineated in the chapter 3: 'Research Methodology'.
Type of psychological contract
In spite of the recognition of the variety of types of contract, the basic distinction between transactional and relational contracts is one that has dominated recent research. (Robinson, Kraatz & Rosseau, 1994). Transactional and relational contracts are not exclusively distinctive, but they are best regarded as the extreme ends of a single continuum underlying contractual arrangements (Rousseau 1990). Rousseau (1995) realized that a bi-polar classification is rather simplistic; thus, she used two factors to distinguish between transactional and relational PCs: the period of the relationship and the specificity of the performance requirements within the relationship. The period of the relationship may extend from short-term to long-term. The performance requirement refers to the degree to which the performance standards are set by the employer or whether the employer allows employees to set their goals. These dimensions allow creation of a matrix of four relationship types.
Contract requirements
Specific
Weak
Time
Short term
Transactional
Transitional
Open ended
Balanced
Relational
Source: Rousseau (1995)
Transactional contract refers to highly specific exchanges of narrow scope over a limited period (Robinson, Kraatz & Rosseau, 1994). It focuses on short term financial relationships and involves low emotional commitment by employees. Organisations provide certain financial benefits as primary incentives for a specific employees' performance within a specific period.
A transitional contract is a short-term, and may occur when an organisation has initiated changes that negatively affect employees 'quality of work life, such as reducing wages and benefits, creating redundancy. Normally, it occurs after a merger or acquisition.
A Relational contract seems similar to traditional working relationships between employer and employee. It is a broader, open-ended relationship, involving socio-emotional and economic factors, and investing considerably in the employees. In the relational contract situation, organisations emphasize the element of trust, security and loyalty as an exchange (Collins, 2007; Hess and Jepsen, 2008).
Midway between transactional and relational contract, the balanced contract focuses on long-term duration, reflects open-ended and relationship-oriented employment with highly specified performance requirements, and is subject to change over time. It has been reported that owing to technological changes, downsizing, and so forth the PC tends to become the new form (Pappas and Flaherty, 2006) as synonymous with Rousseau's balanced PC (Ho et al, 2006).
The old versus new deal
Globalization has affected not only all businesses around the world, but also the nature of employment and employee relations (Conway and Briner 2005). Organisations have more restructuring programs, mass redundancy of employees, focusing on performance measurement, accompanied with an increase hiring of part-time, or contracted in labour markets. Employees' role and responsibilities are no longer well defined and they are expected to be multi-skilled and be ready to work in new tasks, but having less opportunity of promotion, and no longer job security. These situations cause the employment relationship to be transformed from old to new deal (Anderson and Schalk 1998).
The new working ways have brought the trend away from the traditional working relationship, 'relational contract' (Conway and Briner 2005; Herriot and Pemberton, 1996) and shifted towards 'transactional contract' (Arnold, 1996; Rousseau and Parks, 1993).
The characteristic of old deals are similar to relational contract: long-term security, fair pay for good performance, structured, predictable employment scenario, career managed by organisation, time and effort rewarded, income related to experience or status, offered promotion prospects and supported in return for 'going the extra mile', and mutual trust and investment. Whereas, the new deals are similar to 'transactional contract': no security, high pay for high performance, flexible and unclear employment scenario, career managed by individual, performance expected, performance related pay, transactional attitudes 'tit for tat' mentality, and little trust, and much cynicism.
Not only have workforces in private enterprises been affected by the globalisation, but also in public organisations. In the public sector, the paternalistic relationship of the old deal in which influenced by the relational contract is significantly important for employees. Bureaucratic organisation is seen as 'parent' to employee 'child' (Kissler 1994). It tends to paid lower remuneration to their employees compared with the private sector (Coyle-Shapiro and Kessler, 2003), but in turn providing job security as an exchange of the employees' loyalty. Therefore, when job security reduced, there may been a move from an old deal to a more new deal, which employees are supposed to offer high pay instead of job security. This may be problem because providing high pay is unlikely to be materialised in the public sector.
The changes associated with the new deal are impact on both of organisation and individual (Herriot and Pemberton 1997). However, the reactions of employees due to the new deal are mixed. Sparrow (1996) and Herriot and Pemberton (1997) found that graduates are more favourable of the new deal than middle managers or clerical workers. Whereas Van den Brande, et. al. (2002), found that only four per cent of the respondents in Belgian society were fit into the 'new PC', and those respondents were limited to a very small group of young and highly educated professionals and managers.
Consequence of psychological contract breach
When the organisation does not fulfil its obligations, employees may experience a PC breach. According to Morrison & Robinson (1997), a contract breach is defined as the recognition by an employee that the organisation has failed to deliver its obligations.
Conway and Briner (2005) summarized that when a breach occurs, it affects outcomes in terms of affective, attitudinal or behavioural aspects. This is because breach involves unmet perceived obligations, a loss of incentives, feelings of inequity, a breakdown of trust, and an obstacle to goal progression. The consequences of PC breach that employees react to the breach are in various aspects such as decreasing levels of trust in the organisation, level of organisational commitment and PC well-being, having cynical attitudes towards the organisation, thinking about leaving the organisation, feeling anxious, violated, depressed and hurt, and decreasing levels of performance, and organisational citizenship. However, cross sectional studies show that a breach is a reasonably strong predictor of work attitudes, but does not have strong relationships with work behaviour. The weak relationships between breach and behavioural outcomes suggest that breach may not be a particularly useful concept for understanding work behaviour. Therefore, next the consequences of PC breach in relation to job satisfaction, organisational commitment, and intention to quit will be focused upon.
Job satisfaction
Job satisfaction is the perception of an individual about the relationship between what they want from their job and what they perceive they are getting from their job. (Zhao et al., 2007)
Job satisfaction is a widely interested issue by organisation, because it affects both physical and mental health and longevity, eventually impacts on organisational performance such as productivity, absenteeism, and turnover (Locke, 1983). Individuals, who perceive the organisation meet the greater obligation that owed to them, tend to be more satisfied with their jobs (Kotter 1973; Guest and Conway 1999). Various studies found that the correlation between PC breach and job satisfaction is considerably high (Clinton and Guest 2004; Cable, 2008), and the low levels of job satisfaction and non-fulfilment the PC are associated with greater expressed intentions to quit the current job (Cable, 2008).
Organisational Commitment
The relationship between the PCs and the individual's commitment is obvious. According to Meyer and Allen (1997), organisational commitment can be divided into three types: affective, normative, and continuance. Affective commitment refers to employee's emotional attachment to, involvement in, and identification with the organization, or in short meaning to 'want to stay'. Normative commitment relates to a feeling of obligation to continue employment, or 'ought to stay'. Continuance commitment refers to employee's concerns regarding individual's need to continue working for the organisation, or 'have to stay.
As suggested by Meyer, affective commitment is dominated by the extent to which the individuals' needs and expectations about the organisation are matched by their actual experiences. Shore and Barksdale (1998) found that employees who perceived high levels of mutual obligations in the employment relationship, reported high levels of affective commitment. Moreover, the result of various researches stated that the relationship between affective organisational commitment and employee perceptions of PC breach is 'strong' (Cable, 2008).
Besides, the levels of commitment to the organisation also link to the nature of PC. If transactional PC is predominant in nature, the levels of commitment to the organisation are unlikely to be high. In contrast, with relational contract the levels of commitment to the organisation may show much higher. Therefore, if organisations wish to gain such commitment to the organisation, they will need to engender a relational contract with their employees.
Intention to quit
Intention to quit was previously defined as "a conscious and deliberate wilfulness to leave the organization" (Tett & Meyer, 1993, p. 260). An intention of an individual to leave an organization may come from various reasons including dissatisfaction with the job and the organization. Such dissatisfaction may also result from the perception that the organization has failed to provide the PC terms to the employee. As pointed out by Arnold (1996), the PCs may be superior to other concepts in predicting and explaining voluntary attrition. Therefore, understanding the role and function of the PCs could help the organisation to improve that relationship and minimizing the cost of staff turnover.
The relationship between intentions to quit and PC fulfilment, or non-fulfilment is significant in a number of studies. Various studies found that the contract breach increases an individual's intention to quit (Cable, 2008). However, Clinton and Guest (2004) found that the relationship between the content of the PC (what is in the PC) and intention to quit is higher than the relationship between contract fulfilment and intention to quit. The PC contents may affect more on an individual's intention to quit, than non-fulfilment of the contracts.
Characteristics of Thai Context
Thailand, one of a country in the South East Asia, in 2008 there were population at 64.3 millions, and the number of working age population aging of workforce at 38 millions. GDP of the country was 273.2 US$ billions. Thai's Economy is supported by service, manufacturing industry, agriculture and non-manufacturing industry at 45, 35, 11, and 9% respectively. In term of Thailand's economy, according to the Global competitiveness index, Thailand ranked 36th out of 133 countries (World economic forum, 2009)
The efficiency of the labor market (25th) constitutes another strength.
Sectoral value-added as a share (%) of GDP
Key indicators
Population (millions), 2008.......................................64.3
GDP (US$ billions), 2008.........................................273.2
GDP per capita (US$), 2008 ................................4,115.3
GDP (PPP) as share (%) of world total, 2008 .......0.80
Country/Economy
Once a member of the top 30, Thailand (36th) drops for the second year in a row.The global downturn added to Thailand's severe political turmoil and social unrest with grim consequences for the country's economy, which is expected to shrink between 3 and 4 percent in 2009-the first contraction since the Asian Financial Crisis of the late 1990s.The government coalition is now faced with the double challenge of jumpstarting the economy and restoring political stability.The country's competitiveness inevitably suffers from protracted instability. Unsurprisingly, the quality of public institutions continues to deteriorate. Ranked 63rd in this category,Thailand has dropped 20 places over the past three years. Insufficient protection of property rights (75th) and security (85th) are of particular concern to the business community.With respect to public health (78th), HIV/AIDS, which afflicts 1.4 percent of the adult population; tuberculosis (142 cases per 100,000 population); and malaria (400 cases per 100,000 population) are all major concerns.Thailand's technological readiness (63rd) is also lagging. Although mobile telephony penetration is among the densest in the world at 124 mobile subscriptions per 100 population, the use of the Internet (21 users per 100) and computers (6 per 100) remains scarce. Looking at the most positive aspects of Thailand's performance, the macroeconomic situation (22nd) improved slightly between 2007 and 2008.The efficiency of the labor market (25th) constitutes another strength. Finally, the sheer size of its domestic (22nd) and foreign (18th) markets is a source of economies of scale.
Although there is not an international journal article studying the PCs in Thailand, it could be explained the characteristics of the PCs in Thai social context by applying the national working culture which was studied by Hofstede (2005). Hofstede proposes four main factors to explain national culture: power distance, individualism, masculinity, uncertainty avoidance. Thailand is counted high in power distance, low in individualism, and masculinity, but relatively strong uncertainty avoidance. In terms of high power distance, it reflects that there is a relative high degree of autocratic leadership, hierarchical organisation, wherein the managers seem to have more power over their subordinates, and the subordinates are considerably dependent on managers. With regard to low in individualism, it shows that the organisation focuses on fitting harmoniously and on face saving. The employer-employee relationship is moral, similar to a family link. Relationship prevails over the task and direct appraisal of subordinates spoils harmony. As founded in the IBM research, Thailand is 'the most feminine Asian country' (Hofstead 2005, p. 138). In the high femininity workplace, it could be seen: high employment security, people work in order to live, rewards are based on equality rather equity, more leisure time is preferred over more money, as well as humanization of work by contact and cooperation. Last, for high uncertainty avoidance, it refers that in the workplace employees and employers look for long-term employment, and employees are motivated by security and esteem or belonging. From Hofstead's view, it could be concluded that Thai social context seems to be the paternalistic relationship of the old deal in which influenced by the relational contract. However, Chavijitmalakul (2006) studied the PCs of employees in a private company in Thailand and found that majority of employees had a high level of balanced and relational contract, moderate level of transactional contract, and low level of transitional arrangement.
Actually, this assumption, probably, could explain Thai social context at present, but there has been various changes in economics and social phenomena that effects on the organisations in different ways. Furthermore, there is a mythology of younger generational workforces that are become newcomers in the workplace. As seen that they have fundamentally different work values and expectations than colleagues of previous generations (Treuren, 2008), and the organisation must understand their speciality, and manage them differently from the previous counterparts.
Owing to the financial crisis in 1997, this phenomenon caused the high unemployment rate of the country from below 2%, to be higher than 5% after the year of the crisis. Moreover, many private companies had to be closed down, and the mass redundancy was inevitable to occur. Not only were private sectors affected from this crisis, the public sector, especially the Bank of Thailand (BOT), was also significantly affected. This is due to the BOT is the central bank of the country and responsible for the financial stability of the country. At that time, the BOT was questioned from the society about the performance of the organisation and employees. The credibility of the organisation was dramatically decreased. This leads to reason for major changing in the organisation in terms of the strategic management and policy, including organisation development and human resource management. Many programs such as reorganisation and delayering structure of position level leading to fewer employees' career progression, cutting bonus scheme, changing structure of employee's compensation and reducing some health benefit for employee's parent, voluntarily redundancy programme, new performance management system, etc. had been launched in the organisation. On contrary, in the past the BOT was generally accepted to be an organisation with good employment relation and the employers of choice. Employees were likely to be loyal and proud of the organisation. The employment relationships seemed to be the relational type due to its bureaucratic features: early career entry into the organisation, long-term retention, development of organisation-specific skills, seniority system, personal support, and concern for family well-being, etc. (Rouseau, 1995). However, during a past decade the organisational atmosphere seems to be tenser resulting from various human resource practices implemented as mentioned earlier. Although there is not a trade union, the BOT has provided the internal web board that allows employees to express their ideas openly. There have been more disputes regarding remuneration and compensation issues on the web board, and have been more employees filing a lawsuit due to employment condition changes. It seems that the employees' PCs have shifted from relational to balanced or transactional type instead. Furthermore, the number of applicants for a vacant position has decreased, while the attrition rate of young newcomers is quite high compared to other groups. Line managers have perceived that the young newcomers have the different work expectations from the previous counterparts. From the exit interview, it showed that the important reasons for exit were a desire to change a job, fewer value jobs, unhappy with work processes, lack of career advancement, and knowledge or competence not suit for jobs.
Therefore, from the above circumstances, the PC situation in the BOT needs to be studied to determine how each group of employees perceives organisational obligations and fulfillment; consequently, the organisation can better manage the working environment to the needs of all employees. Although, the topic of different generational groups in the workplace is interesting in Thailand, but there has been the argument about the classification of each generational group related to Thai's social context. Social and technological development of the country is likely slower than in the western countries, where much of this research has been carried out. Nevertheless, in this study the classification of generational groups according to the definition of Lowe et al.(2008) is used.
Generational differences
A generational cohort refers to 'individuals born in the same time period who are influenced by a particular set of historical and cultural conditions' and each generational group has a particular type of behaviour which is based on their shared experiences (Smola and Sutton, 2002; Westerman and Yamamura, 2007). The concept of generational group has been cited in many researches, but classification of generational groups is not common. There are various ways to classify each generation in the lights of birth years as followings:
There have been various ways to classify each cohort. However, it is generally accepted that the people in each group have shared experiences, which have influenced their values and motivations (Smola and Sutton, 2002; Westerman and Yamamura, 2007), and resulting in having different traits in each generation (Lancaster, 2004). Therefore, organisations need to understand theirs characteristics and manage them in different ways. Each generation has main features, which can be summarized as below:
Most studies in relation between different generation group and work attitudes, show that difference in generation effects on their work values. For example, Smola and Sutton's (2002) study of how being in different generation groups affected their work values, found that GenXs were significantly different from the Baby Boomers. GenXs had the less organisational commitment, focused on their own needs, expected to get quickly promoted, and were unlikely to believe that work is a critical part of one's life as Baby Boomers' believed. Although GenYs were not included in this study, they believed that because of influenced by technological advancements and seeing their parents as being redundant, Gen Ys might want even higher salaries, more flexible working arrangements, and more ï¬nancial leverage than GenXs.
Westerman and Yamamura (2007) studied the working environment preference of different generational groups and found that BabyBoomers were satisfied and tended to remain in the context of good relationship fit, whereas GenXs were satisfied and tended to remain in the context of goal orientation.
Hess and Jepsen (2008) studied how differences between different generational group and career stages influenced a perception of PC. They found that there are small but significant differences of PC perception between different generational cohorts. All generational groups perceived a higher level of balanced PC than of either relational or transactional PC types. Baby Boomers had a higher level of relational and transactional obligations and fulfillment than GenX. Whereas, for GenX and GenY there were negative relationships between transactional fulfillment and intention to leave.
However, according to Treuren's (2008) study of the employment expectations of different age cohorts by surveying post graduation employment expectations of students, it was found that compared to previous generation; GenYs did not have substantially different expectations about future employment conditions. In addition, it was likely that GenXs and BabyBoomers concerned more about employment conditions that perceived to be required by GenYs than GenYs itself.
Apart from the difference in a generation workforce, the relationship between the difference in age and the PCs is an also interesting topic. Hedge et al. (2006) studied the relations between PCs and job attitudes over the lifespan, and found that older people report less negative affectivity than younger people do, when PC breach. However, according to Matthijs et. al.'s (2008) study of the influence of age in the relation between PC breach and the development of job attitudes, the relations between contract breach and trust and organisational commitment were significantly stronger for younger workers, whereas the relation between contract breach and job satisfaction was stronger for older workers.
Although, the concept of PC and generational cohort rely on the western context, it could be useful to explain the employment relation in other cross culture context. Therefore, in this research PC in Thai social context will be investigated through a case study of the Bank of Thailand, in order to understanding the PC, and how different in generational cohort in Thai context affects on the PC. The next section, Thai social context and the characteristics of the Bank of Thailand will be delineated.
According to CIPD (2010), younger people - 'generation X or even Y may desire excitement, a sense of community and life outside work. They seem to less be interested in a 'job for life' dissimilar to their parent, but concern about building up their skill and competencies' profile that will make them more marketable. The new generational workforces are interested in developing occupational and personal skills, as well as become more proactive and take more responsibility for their own careers. Anderson & Schalk (1998) and Schalk (2004) point out that older workers may have different types of PCs than younger workers. In addition, each generation has different traits (Lancaster 2004), and presently the employee needs and expectation differ in important aspects compared with ten years ago, both in terms of content and in the weight attaching to individual needs, particular in younger employees and those in higher paid or professional jobs (Woodruffe 1999). Therefore, organisations need to understand theirs characteristics, and adapt their policies and communications so as underpin a positive PC in the face of changing employment relation.
Managing the psychological contract
Most PCs researchers have suggested two main areas in managing the PCs that are contents and breach/fulfilment (Conway and Briner 2005).
Managing the PC contents involves in doing things that will alter the PC contents such as changing the quality, adding the new PCs, and removing the existing PCs. Managing the PC contents can be done through imposing change, communicating about promises, and negotiating the contract. Imposing changes in the PCs can manage both in terms of small level of changes, or radical changes (Rousseau 1995). Guest and Conway (2002) state that effective communication ways of PCs can be managed through recruitment, informal day-to-day interactions, and initial training. Although, HR practices are important means of communicating the PC contents (Rousseau 1995; Harriot and Pemberton 1997), daily informal interactions between managers and employees are also regarded as very important. The line managers are the important the organisation's agents, who directly and actively use the PCs to motivate and reward employees and clarify messages from HR practices (Rousseau 2004). However, some agents are not perceived themselves in this role (Guest and Conway 2000). Therefore, to manage PC effectively, the organisation must find who are agents of the organisation in the employees' perspective and ensure that all these agents are giving consistent messages. In addition, the organisations should concern the employee's needs and fairness, as well as promise only things that they can deliver when changing the PC contents through negotiation (Conway and Briner 2005).
Managing breach of PC involves in monitoring the PC breach to ensure that employees and organisation keep their promises, trying to prevent breach happening, and designing strategies to deal with breach in case of its happening. As stated by Conway and Briner (2005), line managers have an important role to monitor the PC breach constantly, and the easiest and possible way to prevent the PC breach is to reduce misunderstanding between the employee and their organisation. Misunderstandings happen when both parties have different perceptions of key promises or the extent to which promises have been fulfilment. Therefore, by promoting a common frame of reference of the contracts that employees concern at most (Rousseau 2001), or using a critical self-reflection method (Morrison and Robinson 2004), and a perspective-taking technique (Conway and Coyle-Shapiro 2003), this can reduce the employees' misunderstandings. However, when a breach occurs the organisation can redress breach through explaining the employees why the breach occurred, offering something of a roughly equivalent value to compensate for losses resulting from breach, and ensuring that employees are treated fairly once breach occurred. Employees reduce the intensity and duration of react negatively to breach if they believe they have been treated fairly after the breach occurred (Kickul, Lester, and Finkl 2002).
Rousseau (1996) outlines four stages for the organisation to transform PC successfully. First, the old contract must be challenged by providing sufficient information support for change. Second, the organisation must prepare for communicating with the employees in advance. Third, the organisations have to generate the new contract, and make sure that the employees buying in the new contract by letting them to get involved in designing process, as well as ensuring that the organisations' agents are readily available for discussion. Last, the organisation must stay with the new contract by ensuring consistency of treatment, delivery of new promises, and reinforcing the new contract by continuous communication. However, Guest and Conway (2002) argued that Rousseau's approach tends to perceive employee as rather passive and responding in the predictable ways. In reality, organisational changes relatively reduce employees' trust in the organisation. Therefore, it is probably that employees may resist any imposed changes to the PC rather easily accepted them.
Objectives
To explore the organisation obligations that the BOT's employees perceived the organisation obliged to provide to them (contents of psychological contract).
To investigate what the extent to the employees' perception how these organisation obligations are fulfilled (state of psychological contract).
To examine how the differences of employee backgrounds in terms of generational group, age, as well as other determinants: tenure, level of education, and position affect their PC perceptions, in relation to contents, states of psychological contract.
To study the relationship between the levels of fulfillment of psychological contract and employees' attitudes and behaviours in light of job satisfaction, organisational commitment, and intention to leave.
To address the important HR issues that the BOT should be concerned in order to manage better employment relation in the organisation.
As stated by Conway and Briner (2005), the PC has been defined in very different ways, and sometimes it refers to be quite different phenomena, which can lead to confusion, and misunderstanding, and has practical and theoretical implications for research into PCs. Therefore, the concept of PC in this study is aligned with following assumptions.
PC includes the obligations based only on perceived promises and not on expectations, and it comprises both explicit and implicit promises.
Owing to ambiguity in identifying a representative of the organisation, this study is based on a unilateral relationship, therefore only the employee's perspective is investigated.
Violation, as a mechanism linking the PC to employee's attitude and behaviours, refers to failure of the organisation to respond to the employee's contribution that the employees perceive the organisation is obliged to do.
