Deleterious Consequences of Change in Newcomers’ Employer-Based Psychological Contract Obligations

PurposeThis study examines the issue of change in newcomers’ employer-based psychological contract obligations over time, viewing change as a potentially important determinant of perceived contract breach and subsequent employee attitudes and behaviors.Design/Methodology/ApproachData were collected using a three-wave longitudinal design from newly hired faculty members (N = 106).FindingsNewcomers’ perceptions of employer-based relational obligations significantly decreased during their first year on the job. Newcomers reacted negatively to these changes, subsequently reporting increased contract breach and more negative work attitudes (i.e., increased turnover intentions and reduced job satisfaction and organizational loyalty).ImplicationsThis study provides evidence of the negative effects of perceived changes to a newcomer’s psychological contract. Practitioners should implement interventions to ensure a realistic set of psychological contract obligations are developed from the start in order to minimize the likelihood that newcomers will modify these obligations downward; and, therefore, experience these negative attitudes toward the organization.Originality/ValueDrawing from the realistic job preview and socialization literatures, this study examines a topic that has received little empirical attention in the extant psychological contract research, yet has important implications to the management of employees’ psychological contracts. Using both a three-wave longitudinal field design and a more rigorous statistical analysis for assessing change (i.e., latent growth curve modeling), we add a unique contribution to the extant research by identifying the negative consequences of psychological contract change on newcomers’ subsequent work perceptions and attitudes.

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