Abstract
This exploratory study delves into the intricate dynamics of employment relationships within family businesses, examining the formation of psychological contracts (PC) among family and non-family employees. Conducted through a qualitative multiple-case approach with four independent family-owned retailers in Ireland, the study employs in-depth semi-structured interviews and the Critical Incident Technique. The findings reveal that family and non-family employees' PC formation is influenced by critical factors such as pre-entry and post-entry episodes, information sources, and agency relationships. Family members undergo early organic PC experiences rooted in familial ties, while non-family employees follow standard organisational entry processes. The research uncovers distinctive patterns in PC formation for both groups, challenging conventional psychological contract theory. It provides practical insights for practitioners in family firms to manage employment relationships conscientiously, considering the formative influences and different pathways to entry. This study contributes to both psychological contract theory and the unique context of family businesses.