Abstract

This research investigates the key factors affecting retention of skilled employees using the psychological contract as a framework in an emerging economy context. The focus of the study was on employees’ perspectives regarding elements of the employment relationship they consider valuable and how these inducements affect their commitment and loyalty to the organization. Data were collected from 98 made up of professional employees within private and public firms in Gauteng Province. The population was drawn from top employers in South Africa.. The main findings of the study show that retention practices focusing on the relational elements of the psychological contract such as job security and career development are more important to employees than those with a transactional inclination such as financial rewards. Trust also seems to play an intervening role in the employment relationship leading to less intense feelings of psychological contract violation amongst employees.

Key words: Psychological contract, employee retention, trust, South Africa.