The Effects of Psychological Contracts, and the Breach thereof, on Innovative Work Behaviour

Abstract

The literature is clear that maintaining psychological contracts between employers and employees is important, and that psychological contract breach often leads to negative outcomes, including the withdrawal of discretionary activities such as innovative work behaviour. Although most literature suggests that a psychological contract breach affects the desired outcomes negatively, the same literature is silent about under which type of psychological contract these outcomes occur. This research aims to empirically determine the way in which psychological contract breach affects the relationship between different psychological contracts (relational and transactional) and innovative work behaviour. A cross-sectional survey design was used, with respondents answering questions on psychological contracts, psychological contract breach and innovative work behaviour. Three results were dominant: transactional psychological contract did not correlate with innovative work behaviour, whereas relational psychological contract did so in a significant way; psychological contract breach correlated positively and significantly with transactional psychological contract and negatively and significantly with relational psychological contract, but not with innovative work behaviour; and psychological contract breach did not moderate the relationship between relational psychological contract and innovative work behaviour. The psychological contract type (relational psychological contract) therefore has a direct effect on innovative work behaviour, but psychological contract breach did not relate significantly to innovative work behaviour. Managers are alerted to the importance of relational psychological contracts when innovative work behaviour is the desired outcome, given the omnipresent psychological contract breach. Researchers are encouraged to investigate through which mechanisms psychological contract breach influences innovative work behaviour, as this link seems well supported by the literature.