When Trust Breaks, People Leave
How to Strengthen the Psychological Contract Before Employees Walk
It’s not just finding the right candidates that’s a challenge for business
leaders anymore. It’s keeping them. People are increasingly drifting away from
the roles they used to love.
The disengagement
isn’t obvious at first. A colleague might talk less in a meeting, or someone
starts updating their LinkedIn profile more often. Maybe a good employee who
used to go the extra mile now only hits the finish line.
Leaders assume their
employees are tired or a little extra stressed, but they’re thinking about
quitting.
Many will leave for
something that’s harder to put into words. A feeling that things don’t quite
line up anymore.
That’s the
psychological contract.
It’s the part of the job that’s not in writing but shapes everything. When its strong, people stay. When it breaks, they start looking for a way out, even if the formal contract remains intact. Once people start pulling away, it’s hard to bring them back.
What You'll Learn:
- Why
employees quit despite stable contracts: The psychological
contract -unwritten expectations about trust, support, and workplace
treatment -drives 20% of workers to plan exits when breached
- The
hidden cost of broken trust: Psychological contract violations trigger
burnout, disengagement, and productivity losses costing businesses
£450-550 billion annually through absenteeism and turnover
- How
to rebuild and strengthen workplace trust: Practical strategies
including transparent communication, consistent leadership behaviours,
managing change with empathy, and HR's strategic role in aligning
expectations with reality
- Early
warning signs before resignation: Recognize when employees mentally
disengage through subtle behavioural changes like reduced participation
and increased LinkedIn activity
Understanding the Psychological Contract
The psychological
contract isn’t something most executives talk about. There’s no space for it on the onboarding checklist. It
doesn’t show up in handbooks or HR dashboards. Still, it exists.
The formal contract an employee gets lays out what they’re
paid for. The psychological contract shapes how they feel about giving their
energy, time, and effort to the work.
The psychological contract is the part of the job that lives
between the lines. It’s built on what people believe they agree to when they
take a role, not just in terms of duties or pay, but how they expect to be
treated, supported, and seen.
It starts early, sometimes before an interview is even
booked. A company’s tone online, the way someone is spoken to in a screening
call, and even how quickly a question is answered all shape what the person
begins to expect. They build a picture of how things work in your business. That picture gets clearer or cloudier through onboarding, team dynamics, and
how feedback is handled.
The challenge is that much of it stays hidden. Managers
often don’t know what their team is thinking. Leaders may believe they’ve been
clear when they haven’t. Employees may hold back questions for fear of seeming
ungrateful. Over time, a gap can grow.
It’s helpful to picture it like an iceberg. The visible part
of the written job description, the title, and the benefits, is only a small
piece. The rest is submerged: all the things left unsaid but still expected. When those expectations aren’t met or change without explanation, trust cracks.
Left alone, the crack deepens, and valuable employees start
dropping away.
The High Cost of Psychological ‘Contract Breaches’
81% of employees expect their employees to build trust at work, but most don’t get what they ask for. Small breaches of the psychological contract build up. A manager asks someone to stay late again, a development plan is postponed, or an opportunity disappears.
Your staff
member might not say anything at first, but beneath the surface, they’re
starting to question you and the role. They stop stepping up and offering ideas
and start stepping back.
The research on this is steady. When people feel their
expectations haven’t been met, they’re more likely to burn out. They become
less committed, less engaged. Many start planning their next move. Others stay,
but it’s not the same kind of staying.
There’s a cost not just in turnover but in the weight people carry when trust slips: increased stress, sleep loss, and a sense of unease that follows them into the weekend.
Studies
show a clear link between breaches and anxiety, exhaustion, and low morale.
Companies feel it, too - in missing knowledge, slower decisions, and the silence that settles during team meetings. Gallup puts the price of disengagement somewhere between £450 and £550 billion a year. It shows up in absenteeism, low productivity, and teams that once worked well together now feeling disconnected.
Building Trust Through Psychological Contract Management
Most of the time, trust doesn’t fall apart all at once. It
frays. A few unclear expectations here, a broken promise there. A manager means
well but says too little. Someone keeps their head down and stops asking for
more.
The contract is still there; it just feels thinner. Rebuilding it or strengthening it before it starts to wear usually means going
back to basics.
Talking Clearly,
Listening Fully
Expectations are often vague until they aren’t met. That’s
when someone realises they had one. That’s also when trust starts to
slip.
Most of this can be avoided by saying more at the start - not
just about what the role is but also about what it feels like to work
with your business, what’s flexible, what isn’t, and what’s still in flux. These details matter more than people think.
It also helps to ask questions that give you a clearer view:
- “What does support look like for you?”
- “Is anything surprising you about the role?”
- “Has anything shifted in what you need?”
People don’t always know how to bring these things up. Most
won’t, unless they’re asked. It helps to have spaces where employees can speak
freely. Let them submit concerns anonymously, or pair them with a mentor, or a
workgroup they can talk to.
Building
Trustworthy Leaders
Trust between employees and a company often hinges on their relationship with their leaders. Managers don’t necessarily need all the answers, but they need to follow
through on what they say, share what they know, and stay honest.
Leaders should be:
- Admitting when something didn’t go to plan
- Checking in without a meeting request
- Treating people’s time with care
- Applying rules the same way to everyone
They also need to be committed to regular feedback. That
means acknowledging employees' hard work, even if it’s just with a quick note,
giving people opportunities for growth and development, and helping them take
the next step forward.
Managing Change
Even in a stable company, things change. Roles shift, and
structures evolve. A good idea today might look different six months from now.
What people want in those moments isn’t perfection. It’s
clarity. Some acknowledgements that what was said then might not hold now, and
that this isn’t being hidden or brushed off.
It’s tempting to delay those conversations. To wait until
you “have more information.” That silence can cost more than uncertainty ever
would.
If something promised can’t be delivered, say so. Say why. Be honest about what’s still true and what isn’t. People might be disappointed,
but they’re far more likely to stay if they feel included. When breaches in the
psychological contract occur because of change:
- Explain the reasoning behind it
- Share a timeline and strategy for fixing the issue
- Show empathy and compassion (don’t be defensive)
Focus on negotiating or renegotiating the deal so it works
for everyone.
HR’s Strategic Role
in Psychological Contract Management
The psychological contract doesn’t live in policies, but HR
often sits closest to where it begins. Job ads, onboarding, role design,
training. These are the places where expectations take root.
If HR isn’t watching closely, it’s easy for the formal and
informal to drift apart. Official promises go one way, and lived experience
goes another. Often, no one notices until someone starts pulling away.
Getting ahead of that means doing the slow work. Checking
whether the stories told through hiring conversations, internal messaging, and benefits
language match reality. If they don’t, update the script.
HR teams in businesses can do this in a few ways:
- Look again at job descriptions. Note what they say and what they imply.
- Make onboarding honest. If something’s not perfect, say so. People trust transparency.
- Train managers to listen for the unsaid. The pause before a “yes.” The smile that doesn’t quite match the words.
It also helps to treat the psychological contract less like
a concept and more like a lens - not “one more thing” to manage, but the lens you
use to notice where trust is holding and where it’s starting to strain.
Closing the Gap Between Expectation and Experience
The psychological contract isn’t something you can hold. There’s no file for it, no formal record. Yet it shapes whether people show up
with energy, or protect themselves from disappointment. Whether they go all-in or
start planning an exit.
What makes the biggest difference for teams isn’t a single conversation. It’s
consistency, clarity, and following through. Making space to ask, “What were
you hoping this would be?” and listening to the answer.
When trust is looked after like this, it doesn’t just keep
people from leaving. It also ensures that they stay motivated, passionate, and
engaged when they stay.