PSYCHOLOGICAL CONTRACT- A CONCEPTUAL FRAMEWORK

In the recent business environment we experience immense changes affecting the current working of organizations in terms of nature of jobs, downsizing and drastic changes in the technology & market demands which have gone beyond the traditional structure of organizations. This has an adverse effect on the relationship of its workers and employees which becomes the reason for variations and misconceptualization of perceptions within the organizations. Therefore, this influences the need for psychological contracts. Psychological contract is a newly arousing organizational term that interprets the fulfillment and non-fulfillment of organizational relationships in terms of mutual obligations, expectations and promises. This phenomenon being an established term in different parts of the world has only now taken its troll in India. Lately, we see and hear of numerous issues of tangled employer and employee relationships across the country. Psychological contract has its tune to epitomize its existence explicitly and implicitly. This article discusses on the major conceptual parts of psychological contract which will include importance and significance of psychological contract, difference between psychological and employment contracts, types, causes and effects of breach and violation of the contract.