Your Team Has an Implicit Contract, and You Might Not Like It

It Hinders Your Team from Doing Great Things!


Your team is like an orchestra. Each member, who are talented individuals, brings their unique talents and contributions to the team.

Imagine an orchestra with members who have different understandings of how they should play together. A beautiful piece of music can quickly descend into cacophony! This is the danger when a team allows itself to operate under implicit contracts.


What is an Implicit Contract

Implicit psychological contracts are the unwritten and often hidden rules, beliefs, assumptions, and expectations that guide our behaviour within a team. They were formed through past experiences and observations. Each team member experienced and observed different things from different perspectives, so they developed their own unique contract.

While these contracts can give individuals a sense of familiarity and routine, they are also unclear and inconsistent. Since each member has a different implicit contract, this can often lead to misunderstandings, frustrations, and derailment of a team’s performance.


I had the opportunity to observe a team deliberating on their strategy. The team leader presented an idea and solicited discussions. One team member, who was a verbal processor, started asking questions and sharing his thoughts. What followed was an almost 20-minute exchange between the team leader and the verbal-processor team member while others simply looked on or did their own things. The two went on to discuss other topics that surfaced in their exchange!

Later, I asked one team member about his thoughts on the exchange, and he said it wasn’t helpful because the quieter members could not contribute. Why didn’t he call it out? He thought it wouldn’t make any difference because it has happened so frequently. “Besides, the guy needs time to process his thoughts verbally, and I don’t want to deprive him of that,” he said. The problem, though, was the exchange prevented other members from contributing. It also took so much time that the team had less time to deal with other issues on their agenda.

In this case, one implicit rule was that the verbal processor’s need was more important and had to be met. Another rule was that members did not call out unhelpful behaviours to the team because it had made no difference in the past.


The Peril of Implicit Contracts

Implicit psychological contracts can negatively impact your team’s environment and performance in the following ways:


  • Misaligned Expectations: Team members may assume different things about workload, communication styles, or even basic courtesies (e.g., a team member expected everyone to contribute to a task but experienced otherwise, or being ‘on time’ meant ‘five minutes early’ to some members but ‘less than five minutes late’ to others). Unmet expectations can lead to frustrations and even resentment.
  • Disengagement and Low Morale: Team members feel unappreciated and disengaged when individual strengths or contributions are not valued or when expectations are unclear (e.g., a team member frequently takes on additional tasks to keep the team’s project on track but his/her efforts were not acknowledged by the leader or by others). This leads to a lack of motivation and a drop in performance.
  • Negativity and resentment: When team members perceive themselves to be less valued (e.g., outspoken team members’ opinions are often considered while the quiet ones do not have a say) or are unfairly treated, they can become less motivated or resentful towards others on the team.
  • Silos and Blame Games: Unclear roles, responsibilities, and authorities, resulting in team members not working effectively together (e.g., who is responsible for what, who should be informed or consulted, who has the final say, etc.). This could foster a ‘not my job’ mentality that creates silos, or result in strife, disagreements, and unhealthy competition between team members. When things go wrong, the blame game ensues, hindering progress.
  • Unleveraged Strengths: When certain strengths are valued, called upon or recognised more than others (e.g., a person who takes quick action gets lauded as having initiative while another who considers risks before taking action gets lauded as lacking initiative, or a person who needs time to contemplate issues before speaking gets viewed as not contributing), the team loses the value that comes from leveraging the diverse strengths of team members.
  • Limited Innovation: Unchallenged beliefs, expectations, and assumptions often create an environment that lacks psychological safety. Team members might be hesitant to communicate openly, share ideas (especially unconventional ones) or concerns, or take risks (e.g., team members might perceive that only well-formed ideas are acceptable or that anything different from established procedures is considered disruptive or rebellious). This prevents the team from innovating and adapting to their changing external environment.


“By contracting with the team explicitly, you take control of the narratives and minimise the perils of implicit contracts.”


Taking Control of the Narrative

All teams have implicit contracts!

When a group of people come together, they each bring their beliefs, assumptions, expectations, and past experiences into the group and quickly form new ‘rules’ and unspoken agreements as they attempt to work together. Some beliefs, assumptions, expectations, ‘rules’, and unspoken agreements might be unhealthy or detrimental to the team!

The good news is that you, as the team leader, can take control of the narratives. By contracting with the team explicitly, you minimise the perils of implicit contracts.

Here are some things you can do:


  1. Facilitate Team Discussions: Schedule dedicated time for open discussions about how the team wants to work together. During this time, encourage team members to share openly about assumptions, expectations, needs, concerns, working style, communication needs, and other issues important to the team’s collaboration. Have the team collaboratively agree on what is acceptable and not, and how they will hold each other accountable.
  2. Lead by Example: Model the behaviour that the team has agreed on.
  3. Regularly Review the Contract: An explicit contract needs to evolve as your team gains experience working together, when the team dynamic evolves, or when the team’s operating environment changes. You will also need to surface any new implicit contract that has formed and take control of the narrative.


Fostering open dialogue can mitigate the peril of implicit contracts. An explicit team contract establishes a foundation of trust and shared understanding. This empowers your team to collaborate effectively, leveraging individual and collective strengths for exceptional results.


What about your team?

How might implicit contracts sabotage your team’s collaboration?

How could you foster open dialogues with your team?


Service to Help Your Team

Team Contracting Facilitation

I can provide a guided Team Contracting session to help your team lay a firm foundation for a psychologically safe environment. This is often helpful for teams with no prior experience in this area. Let’s have a conversation to explore how to meet your needs.


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