Entrepreneurial Psychological Contracts: Shaping the Future of Work in Times of Uncertainty

In the backdrop of a global work environment characterized by uncertainty, fragmentation, and precarization, this paper introduces the ‘entrepreneurial psychological contract’, a concept that reshapes our understanding of employment relations in new venture creation. The paper responds to the need for reimagining employment in an era where standard, stable employment is increasingly an exception. By extending psychological contract theory with insights from incomplete contracting literature, a nuanced perspective is provided on how entrepreneurs navigate the inherent uncertainties of new ventures to establish employment agreements. The paper is conceptual, and it reveals that entrepreneurial psychological contracts are markedly different from traditional bureaucratic contracts, characterized by their procedural, associational, constitutional, and polyarchic nature. This distinction is pivotal in comprehending the adaptive employment strategies in entrepreneurial environments, which mirror the global trends of work fissuring and employee precarization. This paper contributes to the broader discourse on how work and employment should be reorganized in contemporary capitalism. It offers theoretical advancements in entrepreneuring, human resource management, and contracting under uncertainty, and presents practical insights for entrepreneurs in crafting flexible and resilient employment relations. The paper aligns with the call for broadening perspectives on work, promoting sustainable organizational practices, and envisioning new ways of mobilizing workers in the face of global challenges.