Psychological contract as precursor for turnover and self-employment

Abstract

PurposeThe purpose of this paper is to examine the effect of psychological contract (PC) fulfilment and violation on turnover intention and self-employment intentions.Design/methodology/approachA sample of 132 Dutch organizationally employed individuals was used to test the effect of PC fulfilment on turnover intention and self-employment intention. Also, mediation effects of violation on the relation between PC fulfilment and turnover intention and its effect on the relation between PC fulfilment and self-employment intention were examined.FindingsConsistent with existing literature, the results show that lower ratings for PC fulfilment and feelings of violation of this contract can explain intentions to leave. Moreover, the results demonstrate that lower ratings for PC fulfilment are also related to self-employment intentions. This relationship is partly mediated by turnover intentions.Research limitations/implicationsThis research measured intention to turnover, thus not the actual turnover. In addition, self-employment was measured by means of a self-designed scale.Practical implicationsManaging the PC is a delicate but crucial process to prevent valuable employees from leaving the organization.Originality/valueThe paper contributes to the literature on PC fulfilment and employee attitude. In addition, little is known about the influence of PC fulfilment on an employee’s intention to pursue self-employment.