The Changing Employer-Employee Relationship and Implications on HRMOrganizations now operate in a rapidly changing world. Changes in consumer behavior, increased competitive pressure, technological advancements, as well as regulatory shifts in the last few decades have generally compelled organizations to adjust their strategies, objectives, policies, and actions in an attempt to enhance organizational efficiency and profitability (Freese, Schalk & Croon, 2011; Ulen, 2015; Abu-Doleh & Hammou, 2015). In fact, the ability to accommodate change has been marked as a vital ingredient of success in the constantly evolving operational environment (Wellin, 2007). Whereas its importance cannot be overemphasized, adapting to change has had a significant impact on the psychological contract, which essentially denotes the intangible employer-employee relationship, particularly exemplified by mutual expectations between the employer and the employee (Smissen, Schalk & Freese, 2013). The shifting psychological contract has consequently presented a significant challenge for organizations, specifically their human resource management (HRM) function. The challenge relates to maintaining and improving employee motivation, commitment, and job satisfaction, which tend to be crucial drivers of both individual organizational productivity and performance (Smissen, Schalk & Freese, 2013).
It is imperative for organizations to acknowledge the shifting psychological contract, and create new contracts that are favorable to both the employer and the employee. With reference to literature in the area of organizational behavior and HRM, this paper explores the changing employer-employee relationship and its implications on HRM. First, a comprehensive definition of the notion of psychological contract is offered. Attention is then paid to factors responsible for the changing employer-employee relationship, possible consequences of the new relationship, and the actions HRM can resort to, to create contracts that resonate with the modern work environment.
The Changing Employer-Employee Relationship and Implications on HRM
The notion of the psychological contract is not new. It has dominated organizational behavior HRM discourses since the 1960s (Wellin, 2007). Though there is no universally accepted definition, the notion generally denotes the unwritten agreement that define the relationship between an organization (employer) and its employee (Sims, 1994). It refers to the beliefs, perceptions, or expectations employers and employees perceive concerning their obligations to one another (Robinson, Kraatz & Rosseau, 1994). Essentially,...
HRM Challenges in Today's Organizations All organizations require employees to make them a success and this function is considered as important as finance, machinery and land for running the organization successfully. The important point to note here is that individuals all have different temperaments and working methods, and some people in the organization are responsible for making them all work together. This is the job of the human resources department which
Give profile to people in the organization who are high performers and who also use the policies to create a view that success and work-life balance can go hand in hand. Organize some social functions at times suitable for children as well as adults and specifically invite the employees' family members. Introduce awards for managers or supervisors nominated by employees for having provided an environment where both employees' work
The psychological contract takes into account the supposed implicit give-and-take obligations that exist between an employee and his or her employer. In particular, the psychological contract is posited to develop by means of a dynamic process, through continuing sequences of negotiation, breach and fulfillment, and impacts consequences, for example, job satisfaction and turnover plans (Bankins, 2015). Psychological contracts are different from other kinds of contracts not just owing to the
HRM Leadership and HRM in the Public Sector At the national level, leadership in human resource management has been problematic, if not negative, in its effects. The Civil Service Reform Act of 1978 and related legislation established the Office of Personnel Management (OPM) to provide leadership and innovative personnel programs for the federal establishment. Instead, in the first ten years after its creation, OPM established a record of missed opportunities, failed initiatives,
Given the large amount of data analyzed by these researchers, though not collected by them or specifically for their research purpose, these findings provide a compelling area for investigation of the transport company's policies and their potential contribution to the rise in absenteeism that they are experiencing. If a change in contracting terms or workforce composition recently occurred, this could be the cause of recent absenteeism trends, and a
(Rousseau 1989) Pay is generally the most important part of the contents of a psychological contract. In a UK study conducted by Herriot et al. (1996), it was found that employees used fairness and pay most frequently when work environment was discussed. It was the two things that topped the list of things that employees paid attention to when discussion of work environment came up. Pay for performance is the third
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