How a Multidimensional Psychological Contract Shapes Knowledge Workers' Loyalty: The Mediating Role of Organisational Commitment in China's Banking Sector

Abstract

Digital transformation has increased Chinese banks' dependence on knowledge workers while also intensifying competition for their skills. Existing psychological contract research often examines a limited set of contract elements, leaving insufficient evidence on how fairness, organisational procedures, career development, leadership support, autonomy, and relational expectations operate together to shape employee loyalty. Research in banking also lacks an integrated model linking psychological contract, organisational commitment, and employee loyalty in the Chinese context. This study addresses these gaps using survey data from knowledge workers in 18 state-owned and joint-stock commercial banks in Zhengzhou, China. Of 540 questionnaires distributed, 528 valid responses were analysed using partial least squares structural equation modelling. The psychological contract was operationalised as a multidimensional construct comprising distributive justice, procedural justice, and the relational psychological contract. Organisational commitment comprised affective, continuance, and normative commitment, whereas employee loyalty comprised attitudinal and behavioural loyalty. The psychological contract had a positive effect on organisational commitment (β = 0.506, p < 0.001) and employee loyalty (β = 0.322, p < 0.001). Organisational commitment also had a positive effect on employee loyalty (β = 0.403, p < 0.001) and partially mediated the psychological contract-loyalty relationship (β = 0.204, p < 0.001). The findings show that loyalty is produced through the combined influence of fair institutional practices and sustained relational investment, with commitment serving as the mechanism that converts perceived contract fulfilment into loyal attitudes and behaviour. The study broadens psychological contract research and offers evidence-based guidance for talent strategy in Chinese banks.