The Psychological Contract for Australian Defence Force Officers and Human Resource Practices

Abstract

The thesis explores how the psychological contracts of Australian Defence Force (ADF) officers were shaped through the ADF's performance appraisal, career management and compensation practices, and what effects these psychological contracts had on officers' attitudes and behaviours. Case study research was undertaken involving interviews with officers across the three services in 2010 and 2011, as well as with various individuals involved in different aspects of the human resource (HR) practices explored.

While officers reported that the appraisal of their performance was fair, they reported widespread faults. These included ineffective goal-setting, grade inflation, conscious and unconscious rater bias and sponsorship by senior officers of their favoured subordinates. In relation to compensation, there was an increasing emphasis on external market competitiveness in pay and in pay structures, while tribunal processes for wage determination were perceived to be procedurally fair. Officers have become increasingly responsible for managing their own careers and do so by relying on their internal social networks. While career managers were perceived as primarily serving the interests of the ADF, career advisers provided valuable support to officers seeking to overcome work/life conflicts.

The psychological contract communicated by the ADF to officers through performance appraisal, career management and compensation practices has shifted from a relational psychological contract to one that is more balanced. The concept of the employer in the exchange is highly layered and differs between HR practices. The psychological contract has been shaped by supervisors through the performance appraisal process and career advisers through career management practices. Overall, officers perceived that their treatment was fair and there were minimal examples of perceived breach expressed by ADF officers. In relation to performance appraisal and career management practices, explicit informal deals were negotiated between the employer agent and the individual ADF officer generating short-term reciprocity. Yet, there were limits to the level of reciprocity ADF officers felt obliged to provide over the longer term, particularly in light of the impact of their military careers on their personal and family lives. Overall, the responses of ADF officers were increasingly transactional, suggesting that the subtle shaping of the psychological contract by the ADF as employer towards a more balanced psychological contract has been associated with a more dramatic shift in the psychological contracts held by officers.