The Psychological Contract and Hiring Ethics

Selection Success: A Long-Term Measurement

It is a common misconception that the job of selection and hiring is successfully concluded the moment the candidate signs the contract or arrives for his or her first day of work.

The real success of a hire is not immediate; it is reflected months, or according to some authors, up to eighteen months later.

Real success is measured by the value and contributions the new employee has generated for the team and the business in that time, demonstrating that the choice was the right one.

Understanding the Psychological Contract

When a person accepts a job, they not only sign a legal contract; they also establish a "psychological contract."

This unwritten contract is, in many ways, more powerful than the formal document, as it governs the day-to-day employment relationship.

It consists of the mutual expectations and demands that the employer and employee have of each other.

This contract is based on a constant question the employee asks himself or herself, "Does what I am getting from this job justify what I am giving?"

The Components of Psychological Exchange

The employee's evaluation of this contract goes far beyond salary.

The employee weighs his or her time and effort against a set of tangible and intangible benefits:

• The quality of their work experience.
• Their overall quality of life.
• The opportunities for professional development and growth.
• The satisfaction of their social and security needs.

The balance of this exchange (money in exchange for time, effort in exchange for growth, etc.) and the alignment between the individual's expectations and what the organization actually offers him/her, is what determines his/her level of commitment, motivation and, ultimately, his/her permanence in the company.

The Ethical Implication of Hiring

Beyond contracts, the act of hiring carries a profound ethical implication that should not be ignored. A hiring mistake does not have the same impact on all entities.

While large corporations can absorb the cost of a bad fit, individuals and small businesses do not have that same resilience; one mistake can be devastating.

The Ethical Responsibility of the Interviewer

The primary ethical guideline for a manager or recruiter is honesty and transparency.

It is ethically wrong to induce a candidate to accept a position for which he or she is known to be unsuitable, or in an environm