SUSTAINABLE PSYCHOLOGICAL CONTRACTS: A Pathway for Addressing Precarious Employment

The nature of work has changed significantly over the last several decades. Employment in the traditional sense is moving from office buildings to a gig economy characterized by increasing forms of precarious employment, such as self-employment, algorithmic management, platform work, and insecure temporary employment. Although these changes have brought benefits in terms of increased work flexibility for employees and employers, they have also made work more insecure, isolating, and demanding, essentially changing the nature of the traditional employee-employer relationship. In this chapter, we first outline how work has become more precarious and how this impacts employee wellbeing. We then discuss the notion of sustainable human resource management and how its key principles can help mitigate and minimize the negative effects of precarious work. Next, we suggest how these principles can be embedded into a new type of psychological contract, namely, a sustainable and high-quality psychological contract, and discuss how organizations and employees can create, maintain, and repair said psychological contracts. Building on this, we introduce some guiding principles that organizations can use to implement sustainable and high-quality psychological contracts as a way to alleviate or prevent precarious employment conditions.