Great importance is being attached to the concept of the psychological contract. However, the concept does not sit easily within the `traditional' perspective on employment relations with its primarily institutional-level focus. Nevertheless, the concept, depending on how it is defined, has great potential to fill an emerging gap in employment relations: that of individual-level analysis. This gap becomes apparent when a broader, more `contemporary' perspective on employment relations is considered. This `contemporary' perspective moves beyond an institutional-level focus to consider all the behaviours, outcomes, practices, and institutions that relate to the employment relationship. In order to integrate the concept of the psychological contract into `contemporary' employment relations thinking, additional research is required in the following areas: (1) the relationship between employment institutions and individual employees; (2) how employment institutions influence the psychological contract between individuals and their employer; and, (3) the relationship between the legal context and the psychological contract.
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