Psychological contract with construction labour for sustainability in construction

Abstract

The Construction Industry in general and its workforce in particular are the essential partners for rapid economic progress of a country. In the process of marching towards a developed nation, Sri Lankan construction industry has to play its due role. However, industry faces tremendous challenges to sustain the existing workforce and to attract additional skilled and unskilled workforce to the industry to deliver its promises. Effective Human Resource Management (HRM) practices to increase industry productivity standards and retention of construction labor through appropriate contracts with them were highlighted in this regard. Employment ‘contract’ is defined as the bond between the employer and employee for a given task. The emphasis of ‘psychological contract’ is to bring the importance of mutual trust and understanding between two parties where implied terms are vital than written contract. This paper introduces a framework for Psychological contract with labour based on literature review and pilot interviews. Psychological contract model for construction labor contracts was proposed by emphasizing the ‘remuneration and welfare’, ‘dignity’ and ‘motivation and performance of labour’ as three main pillars for building the proposed model. Preliminary findings suggest adopting innovative HRM practices embedded with psychological contract for construction industry to ensure its sustainability.