CHAPTER 2 LITERATURE REVIEW
2.1 Psychological Contract Violation
2.1.1 Summary of Psychological Contract Theory
2.1.1.2 Content and Structure of Psychological Contract
perceptions of coworker attitudes and behaviors. If these subjective perceptions are accepted by the employee, both employ EES develop a psychological contract, which is specifically formulated as: a psychological contract is an employee's understanding of the responsibilities to cope with themselves and the organization, which is committed and reciprocal (Rousseau, 1989, 1995). Overall, the unilateral definition of psychological contract proposed by Rousseau is more operable and supported by many researchers, which promotes the research progress in this field. However, some researchers have questioned this theory and adhered to the bilateral perspective of early psychological contract. Schalk, Campbell, and Freese (1998) propose that a psychological contract is an exchange between employ EES and therefore requires simultaneous consideration of the expectations and responsibilities of both parties.
Whereas Herriot and Pemberton (1997) argue that Rousseau's narrow theory of psychological contract, which does not take into account the process of contractualization, but should be the subjective understanding of the value both employers provide to each other. As for Tsui (1995), he proposes to replace an organizational side with an "organizational agent". Guest and Conway (2002) notes that a psychological contract is a suitable tool for analyzing employment, which is a two-way exchange, so both the expectation and the perception of responsibility of the hire should be taken into account.
Generally speaking, the unilateral theory and the bilateral theory of psychological contract form two kinds of schools, namely, Rousseau school and the "classical school" which advocates following the early theory of psychological contract. Although scholars have different research perspectives, there is a consensus that psychological contract includes the responsibilities and obligations of organizations and employees.
1) Two dimensional structure theory of psychological contract S. L. Robinson and Rousseau (1994) proposed that psychological contract contains two dimensions: transaction dimension and relationship dimension, in which transaction contract is characterized by short-term, outward-going and transactional nature, and its contents are clear, definite, easy to observe and understand, mainly including the enrichment of work, salary and welfare, working environment, working facilities and resources. Whereas relational contracts are more often implicit, ambiguous, subjective, and emotional in nature and include growth opportunities, career advancement, relationships, organizational identity, and support. Millward and Hopkins (1998) then validated the reliability of Rousseau (1995) two-dimensional structure of psychological contract (transaction dimension and relationship dimension) with 1000 British business employees as the subjects.
Tsui, Pearce, Porter, and Tripoli (1997) argued that the psychological contract incorporates both material and mental factors, with material factor referring to extrinsic expectations such as material transaction conditions and mental factor referring to intrinsic expectations such as employee self-worth fulfillment. As far as Kickul (2001) is concerned, it further confirms the internal and external factors of psychological contract, which is divided into "external contract" and "internal contract", in which the former is related to work tasks, such as working conditions, salary and treatment, and the latter is related to work characteristics, such as job challenge and autonomy.
2) A three-dimensional structural theory of the psychological contract
The two-dimensional theory of psychological contract is mainly represented by transaction dimension and relationship dimension put forward by S. L. Robinson and Rousseau (1994), while the three-dimensional theory of psychological contract is a further extension of the two-dimensional theory. Rousseau and Tijoriwala (1996) on the basis of two-dimensional theory, classified psychological contract into three factors, namely, transaction type, relationship type and team member type. This study argues that cooperation among team members is a major factor in employee growth and development, and performance is most notable in a work model dominated by team forms, which expands Rousseau (1995) two-
dimensional structure of the psychological contract. In contrast, Coyle and Kessler (2000) further expanded on S. L. Robinson and Rousseau (1994) two-dimensional structure of the psychological contract, drawing on middle and low-level employees in the UK and refining three public factors through exploratory factor analysis:
Trading type (indicative of economic factors such as salary benefits); Relational type (indicating environmental factors such as work safety and career growth); Training type (denotes learning factors such as job training, skill advancement), and the importance of learning factors was considered for the first time. Thompson and Bunderson (2003) then considered that psychological contract should not be merely about remuneration and work, but should contain personal ideals. Therefore, Thompson and Bunderson (2003) added the dimension of "conceptual psychological contract" on the basis of transaction and relationship dimensions. The study argues that employees may harbor a vision for the future in addition to their focus on job pay and work environment, and that employees' perceptions of future development and personal accomplishment are also a major source of psychological contracts, such as corporate culture, organizational affiliation, and so on. Y. Li and Guo (2002), two Chinese scholars, further complemented the three-dimensional theory of psychological contract, dividing the psychological contract into: normative (the enterprise should fulfill the responsibility of material protection, the employee should fulfill the responsibility of conservative), interpersonal (the enterprise should fulfill the responsibility of interpersonal care, while an employee should fulfill the responsibility for maintaining interpersonal relationships) and development type responsibilities (the enterprise should fulfill the responsibility for career development and the employee should fulfill the responsibility for the work contribution).
3) Multidimensional structure of psychological contract
In addition to two-dimensional theory and three-dimensional theory, some researchers also put forward multi-dimensional theory, such as Rousseau and Tijoriwala (1996), which mapped four quadrants of psychological contract type mode: transaction type, balance type, relationship type and transition type according to whether employee performance requirements are clear and the length of contract period, which provided an extremely convenient path of explanation for a better understanding and coping with the phenomenon and problems of employment
relations. By using a qualitative analysis, Y. Chen (2007), a Chinese scholar, examines the psychological contract from both the organizational and employee perspectives and proposes four dimensions: work support, internal development, involvement in management, and external development, which create a novel analytical framework for a deeper dissection of the relationships between organizations and employees.
By sorting out the previous literatures, this study finds that from the perspective of theoretical construction, the definition of organizational agent is ambiguous and organizational expectations are difficult to measure. Therefore, this study agrees with the definition of Rousseau (1995)'s narrow psychological contract theory and only studies the organizational commitment and the perception of organizational obligations from the perspective of employees. These include organizational commitment to employees (e.g., salary benefits), standards of work (e.g., job duties), and subjective perceptions of coworker attitudes and behaviors. If these subjective perceptions are accepted by the employee, both employ EES develop a psychological contract, which is specifically formulated as: a psychological contract is the employee's understanding of his or her responsibilities to cope with itself and the organization, which is committed and reciprocal. Although the 2D, 3D as well as multidimensional theories of psychological contract have been derived previously through different research methods, this study argues that whether 2D, 3D or multidimensional, the included contents mainly include compensation, benefits, job characteristics, interpersonal relations, organizational work conditions and climate, etc. By combining S. L. Robinson and Rousseau (1994) two-dimensional and (Y. Li &
Guo, 2002) three-dimensional theories, this study delineates psychological contract violation into three dimensions: the Relationship dimension (interpersonal relationship, organizational climate and a sense of belonging, corporate culture and other spiritual factors), the trading dimension (factors involved in material transactions such as pay, welfare and working conditions), the developmental dimension (job characteristics, personal growth realized personal value factors such as professional achievement), to explore the mechanism by which psychological contract violations occur against the employee's counterproductive work behavior.