Reciprocity or negotiation in the psychological contract: a power perspective

Abstract

The psychological contract literature is generally based on the assumption of reciprocity between employee and employer. The emphasis on reciprocity, however, largely downplays the implications of power dynamics in the employment relationship. In order to bridge this gap, the current research investigates psychological contract from the lens of power particularly focusing on reciprocity. In total, 43 semi-structured interviews are carried out with 37 employees and six managers of three call center companies in Pakistan. The technique of template analysis is used for data analysis. In contrast to the assumption of reciprocity, the research findings highlight employees' perceived inability to reciprocate the employer's inducements on parity basis, because of their view of power asymmetry in the employment relationship. The results further suggest the high tendency among employees to attribute employer reciprocity largely to their managers. The findings also point toward divergence in the reciprocity perceptions of employees and managers in relation with the employers. The emphasis on call centers bounds the generality of results. Future research is needed to further explore the impact of power asymmetry on reciprocity in organizations of other industries. With significant implications for the employment relations, negotiated contracts consider the exchange between employee and employer as an obligation rather than a voluntary act of kindness, as emphasized in reciprocity. This research contributes to knowledge by emphasizing the significance of negotiation rather than reciprocation in the psychological contract. The negotiation approach efficiently recognizes the implications of power asymmetry that remain generally under-researched in the psychological contract literature.