Psychological contract breach and mental health: the role of equity sensitivity and self-control

Abstract

Purpose

This study aims to extend the literature on psychological contracts, employee mental health, self-control and equity sensitivity among employees in Ghana.

Design/methodology/approach

Data for this study came from a sample of 484 employees from an organisation in the telecommunication sector of Ghana. The details of the study were discussed with employees after which they were given the choice to participate in the study.

Findings

The present study found that psychological contract breach is directly associated with mental health and indirectly related to mental health through equity sensitivity and self-control.

Originality/value

The findings suggest that psychological contracts are important aspects of the employment relationship that could be used to enhance employee mental health. Furthermore, enhancing employees’ self-control and resolving issues of individuals high on equity sensitivity are effective ways that organisations can deploy to sustain mental health in the face of psychological contract breaches.

Citation

Mensah, J., Amponsah-Tawiah, K. and Baafi, N.K.A. (2024), "Psychological contract breach and mental health: the role of equity sensitivity and self-control", Organization Management Journal , Vol. 21 No. 2, pp. 63-74. https://doi.org/10.1108/OMJ-11-2022-1679

Introduction

The turbulence in the global economy resulting in organisational meltdown has led to many organisations unable to meet some of their obligations to employees. Many employees have had to reassess their psychological contracts with their organisations because of the rapid changes in the workplace. Psychological contract is an employee’s personal beliefs and perceptions of exchange relationships/agreements between an employee and the organisation relative to promises and expectations that can either be fulfilled or breached (Bal, Chiaburu, & Jansen, 2010; Rousseau, Hansen, & Tomprou, 2018). Psychological contracts, therefore, highlight mutual exchanges between individuals and their organisations. Failure to fulfil this contract results in a breach, which is an employee’s understanding and belief that the organisation has failed to meet its perceived terms of the contract.

A breach in the psychological contract has been found to impact organisational outcomes such as turnover intentions (Wang, Li, Wang, & Gao, 2017; Moquin, K. Riemenschneider, & L. Wakefield, 2019) and commitment, job satisfaction and organisational citizenship behaviours (e.g. Bravo, Won, & Chiu, 2019; Amoah, Annor, & Asumeng, 2021). Similarly, findings from scholarly works suggest an inimical effect on organisations and individuals from the breach of psychological contracts (Sharif, Wahab, & Sarip, 2017; Griep, Bankins, Vander Elst, & De Witte, 2021; Zacher & Rudolph, 2020). Despite the findings on the negative outcomes of psychological contract breach on the individual in the form of a decline in well-being and mental health (Griep et al., 2021; Zacher & Rudolph, 2020), little empirical attention has been paid to this phenomenon among Ghanaian workers. Thus, in a developing country like Ghana, where unemployment and underemployment continue to rise (e.g. Nwani & Osuji, 2020; The World Bank, 2020; World Bank Group, 2020), will a breach in the psychological contract of employees’ impact negatively on their mental health or not? Furthermore, with the growing literature on the impact of personality and job resources on well-being and health (Bakker & Demerouti, 2007; Demerouti et al., 2001; Bakker et al., 2010; Herr, van Vianen, Bosle, & Fischer, 2023), this study also explored the extent to which equity sensitivity and self-control can serve as buffers in mitigating the negative consequences of psychological contract breach on the mental health of employees in Ghana. This study, therefore, extends the psychological contract and employee mental health literature by examining the impact of psychological breach on mental health as well as the moderating role of equity sensitivity and self-control in the psychological contract and mental health relationship.

Psychological contract breach and employees’ mental health

Psychological contracts anchor on implicit and unwritten aspects of the employment relationship that focus on the employee’s cognition of reciprocal expectations. As noted by De Clercq, Azeem, & Haq (2020), psychological contracts mitigate the uncertainty of employment conditions since they are essential in the cognition of employees’ predictability and control of their work. Once, employees perceive that the organisation has failed to honor or fulfil its perceived obligations, a breach of the psychological contract is occasioned. This results in uncertainty in the employment relationship, which occasions a loss of control and predictability of the work environment. The loss of control and predictability creates psychosocial stressors in the work environment (Robbins, Ford, & Tetrick, 2012) which affects employees’ mental health (WHO, 2020).

The effort–reward theory posits that the relationship between employers and employees is contingent on reciprocity of the efforts or work inputs delivered by the employee (e.g. task performance), which the employer compensates for through rewards (e.g. pay, health insurance) (Gorgievski, Van der Heijden, & Bakker, 2019). Therefore, a perceived imbalance between the effort–reward or gratification relationship is likely to lead to deficits in the reciprocal work relationship which consequently has the potential to create emotional distress that occasions stress reactions and eventually leads to health problems (e.g. decline in mental health).

In line with the effort–reward imbalance (ERI) model (Siegrist, 1996), it is plausible to assume that the perceived violation of the psychological contract by the employer creates an imbalance in the employee–organisation relationship where the employee believes that his/her efforts have not been rewarded leading to a negative emotional state and job strain which can lead to a decline of mental health. Thus, the decline one’s mental health is accounted for by the reciprocity deficits in the effort–reward relationship relative to the employee which leads to a stressful work environment characterised by loss of control and predictability of the employment relationship.

Reimann & Guzy (2017) found that psychological contract breach is negatively associated with employee mental and physical health. Chambel & Oliveira-Cruz (2010) also report a negative relationship between a breach of the psychological contract and employee emotional exhaustion. Furthermore, Parzefall & Hakanen (2010) found that the fulfilment of psychological contract was positively related to employees’ mental health. Based on the forgone literature, the present study hypothesises that:

H1.

A breach in the psychological contract will impact employee mental health negatively.

The moderating effect of equity sensitivity

As noted by Huseman, Hatfield, & Miles (1987), people react differently to inequity because of a personality and dispositional characteristic – equity sensitivity. Equity sensitivity highlights individuals’ preference relative to their input and outcome ratio and as such plays a key role in workplace behaviours such as reacting to perceptions of inequity in the work environment (Huseman et al., 1987). Three classes of individuals exist along an equity sensitivity continuum: benevolence, equity sensitives and entitled. Benevolent people appreciate input that balances output, while entitled people are only okay when output exceeds input (Huseman et al., 1987). Frustrations emanating from inequity are dependent on an individual’s equity sensitivity; therefore, reactions to perceptions of inequity resulting from the breach of psychological contract are influenced by one’s equity sensitivity.

Past studies have noted that differences in equity sensitivity account for the variations in reactions to the nature and type of psychological contract breach at the workplace (Restubog, Bordia, & Tang, 2007; Rai, Megyeri, & Kazár, 2020). Han, Sears, & Zhang (2018) found that equity sensitivity moderated the relationship between leadership style and organisation citizenship behaviour. Oren & Littman-Ovadia (2013) reported that equity sensitivity buffered the effect of overcommitment on emotional exhaustion and inefficacy. Condrea, Oprea, & Miulescu (2021) found that after controlling for the Big Five personality traits, equity sensitivity had a significant relationship with counterproductive work behaviors. Rai et al. (2020), in a study that examined the impact of equity sensitivity on employee mental health found that equity sensitivity has a positive effect on employee mental health. Based on the above inferences, it is, therefore, plausible to assume that equity sensitivity is an essential factor that determines the extent to which a psychological contract breach can be detrimental to an employee’s mental health. The present study, therefore, hypothesizes that:

H1.

Equity sensitivity will moderate the relationship between breach of psychological contract and employee mental health.

The moderating effect of self-control

Self-control is the extent to which an individual can prevent himself from acting on motivations of instincts or wishes and avoid following up on them (Hofmann, Friese, & Strack, 2009a; Hofmann, Heering, Sawyer, & Asnaani, 2009b). Thus, the higher one’s self-control, the better he/she can refrain from acting on impulses of instincts or wishes and vice versa. Self-control as a psychological resource is associated with varied indicators of mental health, such as satisfaction with life (Hofmann, Luhmann, Fisher, Vohs, & Baumeister, 2014), meaning in life (Vötter & Schnell, 2019a, 2019b) and lower degrees of depression and anxiety (Bowlin & Baer, 2012). Hagger and Chatzisarantis (2013) note that self-control is a benchmark for adaptation, therefore, having and exerting higher levels of self-control may improve one’s well-being and health. Thus, exerting self-control in a situation of perceived inequity or psychological contract breach can enhance an employee’s mental health. Schnell & Krampe (2020) found that self-control had a negative relationship with general mental distress and moderated the relationship between COVID-19 stress and general mental distress. Saba, Ashfaq, & Ali (2019) found that employees with low self-control frequently execute negative deviant behaviours in the face of psychological contract breach more than an employee with high self-control. de Ridder, De Boer, Lugtig, Bakker, & van Hooft (2011) found that self-control was negatively associated with counter-productive work behaviours.

The literature suggests that self-control is a critical determinant of counterproductive work behaviours such as refusing job demands and taking longer breaks (Bolton, Harvey, Grawitch, & Barber, 2012), job stress and strain (Schmidt & Diestel, 2015) and organisational commitment (Schmidt & Diestel, 2015). Self-control has also been found to be an antecedent of emotional exhaustion and depersonalization (Schmidt & Neubach, 2007). The importance of self-control skills in managing stressful situations makes it critical to be examined in the aftermath of a psychological contract breach. Therefore, the present study hypothesises that:

H3.

Self-control will moderate the relationship between breach of psychological contract and employee’s mental health.

Method

Participants and procedure

Data for this study came from a sample of 484 employees from an organisation in the telecommunication sector of Ghana. Out of 550 questionnaires distributed, 500 were retrieved, and 484 were fully completed. The 484 participants included 270 (55.8%) males and 214 (44.2%) females. With regard to age, employees who were aged 40 years and younger were 416 (86%) and those above 40 years were 68 (14%); concerning tenure, employees who have worked for less than 4 years were 247 (51.0%), 4 years to 10 years were 174 (35.9%) and employees who have worked for more than 10 years were 63 (13%). The participants were randomly selected from different departments within the organisations. The details of the study were discussed with employees, after which they were given the choice to participate in the study. Participants were given instructions for the questionnaires they completed.

Measures

Breach of Psychological contract was measured using the nine-item scale by Robinson and Morrison (2000). The items were measured on a five-point Likert scale (1 – strongly disagree to 5 – strongly agree). The scale has a Cronbach’s alpha coefficient of α = 0.92 with items such as: Almost all of the promises made by my employer during recruitment have been kept so far; I feel that my employer has come through in fulfilling the promises made to me when I was hired; I feel betrayed by my organisation.

Mental health was assessed using the 16 items on the Mental Health Indicator 5 (MHI-5) by McHorney and Ware (1995). The items were categorised into four (anxiety, depression, behavioural or emotional control and positive affect) and were measured on a six-point Likert scale (1 – all the time to 6 – none of the time). The scale has a Cronbach’s alpha coefficient of α = 0.82 with the following sample items on the scale: I have been a very nervous person; I have been in very low spirits; I feel so down that nothing could cheer me up; I have been a happy person.

Self-Control Scale by Brandon, Oescher and Loftin (1990) was used to assess how employees control themselves within their workspace. Items on the scale were measured on a five-point Likert scale (1 – strongly disagree to 5 – strongly agree). The scale has a Cronbach’s alpha coefficient of α = 0.75 with sample items on the scale including When I work toward something, it gets all my attention; I pay close attention to my thoughts when I am working on something hard.

Equity sensitivity was assessed using the Equity Preference Questionnaire developed by Sauley and Bedeian (2000). It is a 16-item scale scored on a five-point Likert type scale ranging from strongly disagree scored as 1 to strongly agree scored as 5. The scale has a Cronbach alpha coefficient of α = 0.81 with the following sample items on the scale: I prefer to do as little as possible at work while getting as much as I can from my employer; When I am at my job, I think of ways to get out of work. Miller (2009) reports that higher scores indicate benevolence with low scores indicating entitled.

Results

This study used IBM Statistical Product and Service Solutions (SPSS) version 26.0 to analyse the data. The data analysis was in two parts. The first part was the preliminary analysis, which involved reliability analysis and bivariate correlation. The second part involved testing hypotheses.

Preliminary analysis

This study considered the reliability and normality of the variables used in the study (psychological breach, mental health, self-control and equity sensitivity). Factor analysis was done on each variable to check the factor loadings and determine the quality of the scales used to collect data. The information from Table 1 indicates the skewness and kurtosis values derived from the various covert constructs and it was observed that most of the constructs fell between the rule of thumb of −2 and +2. This points out that the data set was normally distributed. The first hypothesis was analysed using standard regression analysis. The second and third hypotheses were tested using the PROCESS macro Version 4.0 created by Igartua & Hayes (2021). Assumptions of linearity, normality, multicollinearity and singularity were checked before analysis.

The results in Table 2 showed that there was a significant negative relationship between breach of psychological contract and employee mental health (β = −0.01, p = 0.00). This confirmed the first hypothesis, which stated that there would be a negative significant relationship between breach of psychological contract and mental health. This implies that the higher an employee’s psychological contract is breached, the less likely they are to have good mental health.

A moderation analysis was used using Model 1 of the PROCESS macro Version 4.0 by Igartua & Hayes (2021) with a confidence interval of 95% and bootstraps set at 5,000. This was used to test the hypothesis that equity sensitivity will moderate the relationship between psychological contract breach and mental health. Mental health is noted to be the consequent variable with psychological contract breach as the predictive variable and equity sensitivity as the moderating variable. The variables accounted for a significant amount of variance in mental health, R² = 0.03, F(2, 483) = 13, p < 0.00. According to Table 3, the interaction variable which is equity sensitivity negatively influences the already existing relationship between breach of psychological contract and employees’ mental health. This implies that employees who are high on equity sensitivity are less likely to have mental health issues. Table 3 also indicates that the interaction variable self-control negatively influences the already existing relationship between breach of psychological contract and employee mental health.

The condition effect of the focal predictor at values of the moderator indicates that equity sensitivity was negative and statistically significant in the existing relationship between psychological contract breach and mental health. According to Table 4, the results showed that at low moderation of equity sensitivity, the relationship between breach of psychological contract and mental health was significant and positive (b = 0.23, SE = 0.10, p < 0.00). At mid moderation, the relation was also insignificant (b = 0.00, SE = 0.09, p > 0.00). There was a significant negative impact of equity sensitivity on the relationship between psychological contract breach and mental health. This implies that employees high on equity sensitivity have less mental health issues as compared to employees’ low on equity sensitivity amidst breach of psychological contract. Also, Table 4 indicates that, at least self-control, the relationship between breach of psychological contract and mental health was positive and significant (b = 0.11, SE = 0.11, p < 0.00). At mid-moderation, the relation was also insignificant (b = 0.01, SE = 0.09, p > 0.00). The moderating role of self-control at high levels was also significant and negative in the existing relationship. This implies that employees who are high on self-control have less mental stress amidst breach of psychological contract as compared to those low on self-control.

Discussion

Consistent with findings from earlier studies (e.g. Conway & Briner, 2002a, 2002b; Reimann & Guzy, 2017; Achnak & Vantilborgh, 2021) the current study showed a negative association between a breach of psychological contract and employee mental health. Thus, unmet expectations of employees particularly when they feel deserving without any prior information have the potential to affect their mental health negatively. Furthermore, in line with the ERI model, psychological contract breach is an experience that signals a reciprocity deficit to the employee leading to distress and stress reactions which consequently affects the mental health of the employee (Siegrist, 1996).

The findings also show that the relationship between psychological contract breach and mental health is moderated by equity sensitivity. This finding suggests that high equity sensitivity serves as a buffer to mitigate the negative consequences of psychological contract breach on the mental health of employees. Being highly equity sensitive (i.e. benevolent) imply having a greater tolerance for breaches even though the employee is unhappy about them (King, Miles, & Day, 1993) hence a less strain resulting from psychological contract beach which consequently leads to a better mental health. This finding is consistent with Han et al. (2018) and Oren & Littman-Ovadia’s (2013) findings, which reported that equity sensitivity buffered the effect of organisational phenomena on employee behaviours or outcomes, such as emotional exhaustion.

The study also found that the relationship between psychological contract breach and mental health is moderated by self-control. This finding suggests that the negative impact of psychological contract breach on employee mental health is mitigated by self-control. This implies that employees with high self-control can detect a psychological contract breach or deficits and choose not to react or respond to it thereby limiting the strain brought about by the deficit which consequently safeguards their mental health. This finding implies that an individual’s self-control is a resource that can buffer the influence of a negative appraisal of the psychological contract and improve one’s mental health. Self-control as a pillar of emotional intelligence allows individuals to maintain a positive exchange balance following a psychological contract breach (Bankins, 2015) as underscored by the ERI model and hence buffers any negative triggers of mental health. The present finding is consistent with Schnell & Krampe’s (2020) findings which indicated that self-control had a negative relationship with general mental distress and moderated the relationship between COVID-19 stress and general mental distress.

Implications of findings

Our findings contribute to the literature by highlighting the mechanisms through which psychological contract breach affects employees’ mental health. We argue that the experience of psychological contract breach represents a reciprocity deficit as highlighted by the ERI model that causes strain for the employee and consequently diminishes his or her mental health. In terms of organisational practice, the findings suggest that organisations and managers become more sensitive towards the potential consequences of psychological contract breach due to its effects on mental health. To deal with this consequence, psychological contract breaches should be mitigated or at best avoided by the organisation. Managers and organisations can mitigate or avoid psychological contract breach by making realistic and achievable promises during employee selection and placement and day-to-day work or offering sound explanations as to why the organisation has not been able to fulfil its obligations (Zhao, Wayne, Glibkowski, & Bravo, 2007). It is also important that when managers become aware of psychological contract breaches, they offer effective strategies and resources (e.g. offering career advancement opportunities and improving conditions of service) that will enable employees to cope with the breach. Furthermore, the findings suggest that equity sensitivity and self-control are resources that employees can deploy to mitigate the effect of deficits or psychological contract breach on their mental health; therefore, employees can enhance their capacities in this regard through self-control training. Organisations must also strive to create a fair working environment because it is important for promoting the mental health of employees.

Limitations and recommendations

Despite these valuable findings, the present study has some limitations. Firstly, the cross-sectional design implies that causality cannot be inferred from the model. Secondly, the study relies on self-reported data which could create problems of social desirability, memory bias and reporting bias. Furthermore, though self-control has been found to mediate the association between psychological contract breach and mental health, the study is unable to account for the strength of the different strategies of self-control (see Duckworth, Gendler, & Gross, 2016) in the mediational model.

Future research can address these shortcomings of this study by using a longitudinal design which allows for multiple assessments of these variables over a period to ensure consistency of self-reported data. Studies in the future should also explore the strength and hierarchy of the different self-control strategies that account for their positive relation with mental health in the aftermath of psychological breach. It is imperative that future studies examine and analyse how psychological contract breach occasions stress reactions which eventually lead to an impaired employee mental health.

Conclusion

The recent COVID-19 pandemic has heightened expectations among employers and employees alike. Whereas employers expect a resilient workforce, employees expect sustained and rewarding jobs, albeit psychological in nature. The present study extends the literature on psychological contracts, employee mental health, self-control and equity sensitivity by showing that psychological contract breach is directly associated with mental health, and indirectly related to mental health through equity sensitivity and self-control. Our findings suggest that psychological contracts are important aspects of the employment relationship that could be used to enhance employee mental health. Addressing reciprocity deficits in the employment relationship is an effective way of dealing with psychological contract breaches, hence a crucial need for clear and effective communication on reciprocal expectations. While managers look for a resilient workforce to sustain their operations in today’s turbulent and chaotic environment, efforts should also be geared towards enhancing the emotional intelligence of existing employees as self-control, one of the pillars of emotional intelligence that has a buffering effect under unexpected circumstances.

Table 1.

Skewness and kurtosis and bivariate correlations (n = 484)

Variables	Skewness	Kurtosis	1	2	3
Psychological contract breach	0.72	1.8	–
Mental health	–0.58	1.2	0.03*	–
Self-control	0.47	1.9	0.29**	0.07	–
Equity sensitivity	–0.51	1.8	0.13**	0.14**	0.30**

Notes:

* = Correlation is significant at 0.05 level, ** = Correlation is significant at 0.01 level; Correlation is significant at the 0.01 level (two-tailed)

Source: Table by the authors

Table 2.

Summary of standard regression

Model	B	Std. error	Beta	t	Sig
(Constant)	50.05	4.16		12.02	0.00
Breach of psychological contract	−0.02	0.09	−0.01	−0.15	0.00

Notes:

R² = 0.081; Dependent variable = mental health

Source: Table by the authors

Table 3.

Summary of the results of the moderation effect

Model	B	SE	t	p-value
Constant	2.91	13.45	0.21	0.00
Psychological contract breach	2.09	0.56	3.69	0.00
Equity sensitivity	1.09	0.24	4.39	0.00
Self-control	1.48	0.22	2.15	0.01
Int_1	−0.01	0.01	−3.72	0.00
Int_2	−0.01	0.01	−1.79	0.02

Notes:

B = coefficient/slope of the intercept; SE = standard error; p = significant level; Int_1 = interaction

Source: Table by the authors

Table 4.

Interaction/condition effect of the focal predictor at values of the moderator

Equity sensitivity	Effect	SE	t	p-value	LLCI	ULCI
48.00	0.23	0.10	2.44	0.03	0.01	0.45
54.00	0.00	0.09	0.02	0.98	−0.17	0.18
60.00	−0.23	0.11	−2.08	0.03	−0.44	−0.01
Self-control	Effect	SE	t	p-value	LLCI	ULCI
39.00	0.11	0.11	0.98	0.04	−0.11	0.34
45.00	0.01	0.09	0.19	0.84	−0.14	0.20
52.00	−0.09	0.11	−0.85	0.03	−0.30	0.12

Notes:

SE = standard error; p = significance level; LLCI = lower level confidence interval; ULCI = upper level confidence interval

Source: Table by the authors