Organizational Culture and Employee's Psychological Contract: A Signaling Theory Perspective

The present study investigated the relationship between organizational culture and employee's psychological contract. The study also sought to examine the different dimensions of Organizational culture on two types of psychological contract (relational and transactional psychological contract). Using random sampling procedure, data were collected from 300 employees working in two public sector organizations in Bhutan. Correlation and regression analysis were carried out to test hypotheses of the study. Results revealed that organizational culture does influence the employee's psychological contract. It was also found that supportive and achievement culture positively and significantly influenced transactional psychological contract; whereas power and role culture significantly and positively influenced employee's transactional psychological contract. Implications of the study have been explicated in the research.