Social Obligation: Proposing a Compliment to Psychological Contract

Every organization is composed of nested formal and informal organizations. Bernard (1938) conceptualized that informal groups arise in formal organizations and these informal groups evolve to become functioning informal organizations within formal organizations. Mainstream research in organization theory has focused primarily on formal organizations wherein employee-employer relationships guide employees’ work motivations as in the construct of psychological contract. Psychological contract incorporates the mutual beliefs, perceptions, and informal obligations between an employer and an employee and explains why people work in organizations. However, psychological contract fails to explain what happen in organizations, where there is an absence of employee-employer relationships. There is a gap. Also, the construct is inadequate in explaining work motivations in settings that are predominantly informal organizations. We propose a construct of social obligation as an alternative to explain motivations to work in informal organizations. In this paper, we define social obligation as – A set of reciprocal ties, responsibilities and consequent authorities that are primarily rooted in the uniform states of mind of individuals in the informal organization, which motivates work in those organizations. We describe the constituent elements of social obligation as a set of ties that bind members to one another, which leads them to feel responsible for each other and for society at large and which further begets them the consequent authority of legitimacy to act and fulfill those responsibilities.