This article examines the functioning of team charters in teamwork. We argue that the psychological contract literature serves as a theoretical foundation for understanding team charters. We examine what types of psychological contracts are established and developed during interactions between team members and whether these psychological contracts are related to team functioning. Through in-depth interviews and objective performance measures, we find some distinct patterns of psychological contracts that can be related to team functioning. Our results indicate that teams may benefit from early and explicit discussions about standards for work effort and work quality, and about the importance of being tolerant with each other. More particularly, we find that teams that are able to “cut each other some slack,” that is, the ability to live with short-term imbalances in give-and-take relationships, are more functional teams.
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