Understanding Employee Psychological Contract and Job Satisfaction

Abstract

Objective - Organizational changes and transformations are common phenomenon these days. Changes may lead to the breach of the psychological contract of employer-employee expectation on the employment thus affects employee job satisfaction. This study was conducted with the aim to identify the relationship between psychological contract and employee job satisfaction. Methodology/Technique - Two components of psychological contract were used in this study, namely transactional dimension and relational dimension. Data was collected using a questionnaire which involved the total of 100 employees at Oil and Gas Company in Malaysia. Findings - Generally, the results indicated that there was a significant relationship between psychological contract and job satisfaction. However, the only relational dimension of psychological contract is significantly related to job satisfaction. Thus, it is important to understand the influence of psychological contract towards employee job satisfaction since it will affect the overall performance of an organization. It is crucial for organizations to develop mutual long term interdependence with their employees by providing on-going training and development and promotion opportunities in return making employee obligated to go beyond the explicit requirement of their role. Novelty - It was very few articles discussing the comparison of the psychological determinants of online self-disclosure and privacy issues between Polish and Indonesian. Type of Paper - Empirical Keywords : Psychological contract; relational dimension; transactional dimension; job satisfaction.