Which term describes informal obligations between an employer and employee that influence their interactions?

Which term describes informal obligations between an employer and employee that influence their interactions?

• A. Purchase
• B. Range
• C. Psychological contract
• D. Ransom

Answer: (C)

The main concept here is the psychological contract—the unwritten set of expectations and obligations that both the employer and the employee believe exist. It goes beyond formal duties and pay to include beliefs about trust, fair treatment, career development, job security, and support for growth. These informal promises shape how people interact every day: when employees feel the employer will honor these unstated commitments, they’re more engaged, loyal, and cooperative; when they sense promises are broken, motivation and performance can drop and turnover may rise. This term specifically captures those informal obligations that influence behavior and interactions between the two parties. The other options don’t describe this social, implicit agreement at all.

The main concept here is the psychological contract—the unwritten set of expectations and obligations that both the employer and the employee believe exist. It goes beyond formal duties and pay to include beliefs about trust, fair treatment, career development, job security, and support for growth. These informal promises shape how people interact every day: when employees feel the employer will honor these unstated commitments, they’re more engaged, loyal, and cooperative; when they sense promises are broken, motivation and performance can drop and turnover may rise. This term specifically captures those informal obligations that influence behavior and interactions between the two parties. The other options don’t describe this social, implicit agreement at all.