Psychological contract describes an individual’s beliefs, shaped by the organisation
regarding the terms of an exchange between an individual and the organisation (Rousseau,
1995). Robinson (1996) defines psychological contract as the employee’s perception of
what they owe to their employers and what their employers owe to them. The
interpretation of psychological contract between employee and employer may not be
necessarily shared by both parties as it is highly perceptual and subjective. Scholars also
indicate that the differences in perceptions may result in one party believing that the other
has violated the terms of the contract. Employees’ perceptions of the obligations
established at the time of employment may change as the years of employment increases;
hence, employees tend to attribute increasing perceived obligation from their employer
while their own perceived obligation decreases (Robinson, Kraatz, & Rousseau, 1994).
In light of Robinson et al.’s view, one can regard PCV as an emotional and affective state
that may follow from the belief that one’s organisation has failed to adequately maintain
the psychological contract. Robinson et al. also indicate that violation leads to low
organisational commitment, less organisational citizenship behaviour and poor job
satisfaction.