Exploring the role of reciprocity in psychological contracts : a study in a Finnish context
The concept of the psychological contract has received increasing attention in the organizational behaviour literature. It can be defined as an individual's beliefs regarding the terms and conditions of a reciprocal exchange agreement between himself/herself and another party. Existing research has primarily focused on exploring how employees respond to perceived employer psychological contract breach. Limited attention has been paid to the norm of reciprocity as the underlying exchange mechanism, to contract formation and maintenance, and to the employer's perspective on the exchange. Using quantitative methodology, this thesis drew upon two separate samples of employees and one sample of employer representatives from two knowledge intensive Finnish organizations, comprising 109, 162 and 45 respondents respectively. A qualitative interview study of 15 employees of one the participating organizations complemented the quantitative studies. The specific aims of the thesis were 1) to examine different reciprocity forms from both employee and employer perspectives in terms of their antecedents and outcomes; and 2) to extend existing knowledge on how the psychological contract functions as a schema and how the employees see the role of reciprocity in their exchange relationship with their employer in an event of perceived contract breach. The findings of the quantitative study indicated from the perspective of the employee that perceived contract fulfilment by the employer influenced employees' perceptions of the form of reciprocity underlying the exchange relationship. Trust played a mediating role in affecting these relationships. With regard to behavioural outcomes, the different forms of reciprocity had different associations with the employees' attitudes and behaviours measured, but did not influence employees' fulfilment of psychological contract obligations. From the perspective of the employer, managers' perceptions of employees' fulfilment of the contract obligations were positively associated with their perceptions of their own obligations and the fulfilment of these obligations. Similarly, perceptions of an organizational reciprocity norm were found to have a significant effect on managers' perceptions of their obligations to employees. Relationship reciprocity orientation in the manager-employee exchange played a mediating role in these associations. The qualitative study in turn found that employees' responses to contract breach depended on their sense-making process. Employees' interpretation of the breach influenced the extent to which the breach threatened the overall psychological contract schema and the employees' adherence to the norm of reciprocity. The contributions of the thesis, its main research and practical implications, and future research directions are discussed.