Psychological Contract Violation: Impacts on Job Satisfaction and Organizational Commitment Among Australian Senior Public Servants

In a world of ongoing organisational transformation, the psychological contract between the employer and the employee is open to violation. It is imperative that senior managers, as change agents, have a good understanding of the psychological contract and how it influences employee behaviour and attitudes towards their job and their organisation. This paper explains the concept of psychological contract violation and presents the results of a survey of executive management personnel from the Australian Public Sector. The results of the survey revealed a negative relationship between psychological contract violation and both job satisfaction (r =-.77) and organisational commitment (r =-.67). Recommendations are given on how an organisation can minimise perceptions of violation through human resource strategies, policies and procedures that foster open communication and are reflective of distributive, procedural and interactional justice. A WIDE CROSS-SECTION of organisations, within both the private and public sectors, are constantly being challenged by global competition, advancing technology, the utilisation of a diverse workforce, and the provision of high-quality products and services (Karpin, 1995; Noe, Hollenbeck, Gerhart & Wright, 1997). In the face of such challenges, many organisations reinvent themselves through such processes as reengineering, restructuring and downsizing. These transformations usually involve the renegotiation and alteration of the employment agreement to fit changing circumstances (Guzzo & Noonan, 1994;