...contract scale developed to measure employees' beliefs about their actual relationships with their employers. Internal consistencies for these scales ranged from .72 to .89 across samples in three studies. Factor analyses verified the hypothesized two-dimensional structure. Implications of the two distinct forms of employment contracts for future research and managerial practice are highlighted.

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Relationships between employers and employees have undergone dramatic changes during the past decade (Downs, 1995; Hakim, 1994; Hall & Moss, 1998; Jaffe & Scott, 1998; Kissler, 1994; O'Reilly, 1994; Sims, 1994; Weick, 1996). These changes are a likely manifestation of the pervasiveness of downsizing and restructuring that has occurred during the past decade, and that will likely continue into the foreseeable future (Cappelli, Bassi, Katz, Knoke, Osterman, & Useem, 1997; McKinley, Mone, & Barker, 1998; Rotondo, 1999). However, researchers disagree as to whether these changes are impacting the social contract or the psychological contract. Hakim (1994), for example, writes that the new employment relationship consists of a social contract requiring all employees to be self-employed because they are no longer entitled to jobs, but instead must earn their jobs. Downs (1995), among others (e.g. Ellig, 1998; Maxwell, Briscoe, & Temin, 2000), suggests that the new social contract requires that employees be responsible for acquiring their own skills and employability. In contrast, Kissler (1994) posits that changes in the employment relationship have created psychological contracts in which long-term employment in exchange for employee loyalty is unlikely. Lucero and Allen (1994) noted that psychological contracts have changed so that employers are shifting the obligations of benefits costs to the employee.

The present research was designed to shed light on several facets relevant to the definition of employment contracts and the implications of employment contracts for organizational behavior. First, we distinguish between two types of employment contracts--the social contract and the psychological contract--and clarify several important implications of this distinction. Second, we develop efficient scales that assess psychological contract and social contract as distinct constructs. Third, we present the results of several studies that document the factor structure and internal consistency of the scales and that examine convergence and divergence with other measures. Finally, we highlight several implications that the distinction between social and psychological contracts has for future research and practice.

Social Contract

We define a social contract as the set of norms, assumptions, and beliefs that society conceives as fair and appropriate for parties involved in employment relationships. Thus, it defines the beliefs and norms pertaining to reciprocity, job security, loyalty, good faith, and fair dealings that should be maintained by employees and organizations in general. Our definition is a narrowed view of the current variety of social contract definitions. For example, Rousseau (1995) defined the social contract as taken-for-granted realities and assumptions. Morrison and Robinson (1997) further defined the social contract as the assumptions, norms, and beliefs about appropriate behavior with respect to a social unit. Rousseau and Tinsley (1997) defined the social contract as being comprised of pervasive beliefs regarding obligations within a society that are taken-for-granted realities. Given these varying definitions, it seems that different social contracts exist that can dictate appropriate behavior in different societal contexts, such as employer-employee, teacher-student, and husband-wife relationships. Behavior that is considered appropriate according to one social contract may be considered inappropriate under another (Clark & Waddell, 1985).

The sources influencing the beliefs that are incorporated into the social contract are numerous and varied (Rousseau, 1995). These sources include, but are not limited to, public opinion, the education system, laws, courts, professional associations, media, ideologies, regulatory agencies, governmental requirements, and organizations. Most centrally, organizations significantly influence the social contract (Morrison & Robinson, 1997). In the current work, we focus on individuals' perceptions of the social contract that they perceive should exist between employers and employees in today's organizations.

Psychological Contract

We define a psychological contract as the employment relationship between an organization and an individual employee with regard to the obligations that each party has to the other. Psychological contracts have generally been defined as beliefs about what employees are entitled to receive from their employer (Hallier & James, 1997; Robinson, 1996; Rousseau, 1989, 1990, 1995; Rousseau & Aguenzo, 1993; Rousseau & Wade-Benzoni, 1994). Thus, researchers have started to examine the perceptions of employment relationships from the perspective of the employer (Rousseau & Schalk, 2000). In the current research, we focus on the employee's perception of the psychological contract.

Employee beliefs about the psychological contract develop, in part, from either explicit or implicit promises made by the employer at the time of recruitment, as well as during continuing interactions between employee and employer. Not all expectations evolve from perceived promises. Some expectations are developed in the absence of perceived promises or psychological contracts (Robinson, 1996). These expectations may, in part, be developed by employees' perceptions that they are entitled to certain obligations from their employer as a result of their contributions over time (Robinson, 1996), such as employee beliefs that their hard work and loyalty should be rewarded with long-term employment security.

The psychological contract differs from the social contract in several other ways. The psychological contract is developed at an individual level and the social contract is developed at a societal level. Also, the psychological contract is a set of assumptions and expectations between a specific employee and a specific employer, whereas the social contract establishes assumptions and norms regarding a wide variety of employment relationships. Therefore, actions that may violate a specific individual psychological contract may be within the norms of the social contract. Thus, breach of a psychological contract between an employee and employer will be perceived at an individual level (Robinson & Morrison, 1995; Robinson, Kraatz, & Rousseau, 1994), whereas violation of the social contract...

NOTE: All illustrations and photos have been removed from this article.




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