Chapter 01 – Organizational Behavior: The Quest for People-Centered Organizations and Ethical Conduct
1–38
SUPPLEMENTAL LECTURETTE 2 – WRITING THE NEW EMPLOYMENT
CONTRACT3
APPLICATION
This lecturette may be used to supplement the chapter’s coverage of the
changing nature of work. Writing the New Employment Contract, may be used
as an additional teaching aid.
* * *
In our changing economy, large scale layoffs on all levels have become common.
Although organizations may view downsizing as a necessary response to
economic pressures, it has a host of ramifications for the world of work. Some
statistics indicate that layoffs are, in the long term, bad for the bottom line. A
downsized organization has a less than 50-50 chance of improving profitability
and productivity. Short-term stock gains are often outweighed by loses due to
the resulting bad publicity.
One of the most significant repercussions of continual downsizing is the change
in the nature of the employment contract between worker and organization. The
“employment contract” may be defined as the written and implied expectations
between employer and employee. Layoffs serve to sever the psychological
contract that traditionally connected professionals and their employers. In
response, professional employees feel the need to look out for themselves,
instead of relying on a paternalistic organization. Rather than the “organization
man” we are becoming a workforce of “migrant managers.” Under the new
contract, one has to think about challenges rather than commitments. The new
employment contract is a positive change for employees committed to life-long
learning, working smarter rather than harder, and making their own opportunities.
Promotions will be fewer and slower than under the old employment contract
because of flatter organizations with fewer layers, but lateral moves from one
project or function to another will provide challenges for those who perform.
People now must build a portfolio of sellable skills. How can one survive under
this new employment contract? Here are some suggestions:
Build your skills. Don’t focus on titles, concentrate on building a diverse skills
portfolio. With the right set of skills, you have the freedom to change divisions,
companies, or even industries. Remember, to be most effective, skills must be
portable. The more tasks you’ve performed and problems you’ve solved, the
better your chances in this new world of work.