What are overt and covert contracts?

Overt and covert contracts refer to the types of implicit or explicit agreements between individuals in various interactions, often discussed in the context of relationships.

Overt Contracts: These are clear, explicit agreements where the terms are openly acknowledged by all parties involved. Examples include formal contracts like employment agreements or less formal ones such as splitting profits from a collaborative project. Overt contracts are openly communicated and agreed upon, involving direct exchanges like work for money or splitting earnings from a collective endeavor 1.

Covert Contracts: These involve unspoken expectations or hidden agendas not explicitly agreed upon by all parties. Covert contracts often lead to problems because they involve indirect, uncommunicated expectations where one party may expect some form of compensation or acknowledgment that isn't openly agreed upon. They are considered harmful as they can involve resentment, secret manipulations, or unexpected paybacks that were never part of the initial agreement. This type of contract can manifest in various relationships, including professional and personal spheres, and is generally viewed negatively because it often leads to conflict or disappointment 1 2.