Define a ‘psychological contract’ in the workplace and using real-world examples, apply different types of psychological contracts and justify their benefits to employer and employee

The term “psychological contract” refers to an employee and employer’s perceptions of an individual’s goals, beliefs, goals, and obligations. A “relational psychological contract” is a long-term exchange in employment agreements and non-specific performance terms that help companies provide stable pay and long-term employment and promote the well-being and interests of employees and their families (Soares & Mosquera, 2019). One benefit of this contract is that if both sides agree, the contract can facilitate social commerce and economic conditions.


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