Abstract
Orientation: The psychological contract has long been recognised as a pivotal element in the relationship between employees and employers, influencing job satisfaction, commitment, and turnover intentions.
Research purpose: This research aims to bridge the literature gap by exploring employees' lived experiences regarding their psychological contracts within a South African construction services company, focusing on how unmet expectations and psychological contract violations can adversely impact employee retention.
Motivation for the study: Previous research in the South African construction industry has highlighted significant challenges, such as high turnover rates, skill shortages, and unmet employee expectations, which have had profound implications for organisational effectiveness. Despite extensive study, the existing literature, which is predominantly quantitative, often overlooks the subjective, lived experiences of employees, particularly in contexts shaped by unique cultural and economic factors within the South Africa context.
Research design, approach, and method: The research employed a qualitative research approach, using semi-structured interviews to gather data from employees, which was analysed thematically to provide a comprehensive framework for understanding the dynamics of psychological contracts.
Main findings: The findings highlighted the importance of fulfilling both transactional and relational elements of the psychological contract, such as remuneration, recognition, and career development, to enhance employee commitment and reduce turnover intentions. Notable inconsistencies were found in general communication from leadership, career advancement opportunities and recognition practices. Additional psychological contract violations included unclear remuneration expectations, insufficient management engagement, unfavourable policy changes, inadequate attention to employee burnout, diminished trust in work autonomy, and unequal distribution of benefits. The empirical findings validated the applicability of social exchange theory, as participant responses reflected principles of reciprocity, mutual exchange, and the pursuit of balanced relationships.
Practical implications: The research highlights the critical need for organisations, particularly in the South African construction services industry, to address these psychological contract violations by improving communication and recognition practices, enhancing cultural sensitivity, and aligning leadership practices with employee expectations to foster a more supportive and inclusive work environment.
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Contribution/value add: This study contributes to the literature by providing a detailed exploration of psychological contracts in a context with limited scholarly attention, emphasising the complex interplay of cultural, economic, and organisational dynamics. It extends the theories of social exchange, identity, and organisational justice within the South African construction services industry, offering actionable insights for enhancing employee engagement and loyalty.
Keywords: Psychological contract, psychological contract breach, social exchange, employee employer relationship, turnover intention, construction industry.