The relationship between psychological contract breach and job related attitudes : a study within a pharmaceutical industrial plant in Malta

Abstract

This study explores the employees' Psychological Contracts which are mental models of promises and obligations made by their organisation. Psychological Contract Breach is the term used to define the negative sentiment of employees which perceive broken promises and obligations made by their employer. The purpose of this study is to investigate any relationship between Psychological Contract Breach and three distinctive employee attitudes which are: Organisational Citizenship Behaviour which encompasses voluntary helping behaviours in between employees or towards the organisation, Trust in the organisation, and the Intention to leave the job. Competitiveness in any industry is the result of investment in capital but above all human resources. Human Resources Managers have to foster a healthy workforce both physically and psychologically especially in difficult times. The study was carried out in a pharmaceutical industrial plant situated in the islands of Malta. This plant was in the process of a takeover from a multinational which is a global player in the pharmaceutical markets. Mass redundancies and major restructuring was announced during this period. The adverse effect on the redundant employees was an understandable one, but the effect on the survivals of downsizing was underestimated by the management resulting in turnover intention by many valid and experienced employees. These are crucial for the enterprise in order to revitalize the enterprise and accomplish the objectives of restructuring. A total of 258 employees participated in this research. The questionnaire was designed to shed light on the three hypothesis which predicted correlations between Psychological Contract Breach and the three job related attitudes. The first inferential statistics results found no significant relationship between Psychological Contract Breach and Organizational Citizenship Behaviour, while there is a significant negative correlation between Psychological Contract Breach and Trust, and a positive correlation between Psychological Contract Breach and Intention to Leave the Job. The findings imply that the Human Resources Management should act on this situation to override scepticism and reduce turnover intentions amongst the workforce.