Millions of small businesses in the UK are breaking the law and risking costly employment tribunals with lax HR policies, according to research by business insurance comparator SimplyBusiness.co.uk.

- More than a fifth of small firms have no employment contracts
- Around three quarters have no policies on smoking, alcohol and drugs
- Nearly three quarters have no written rules on expenses

Two fifths (40%) of firms have no written HR policies, and despite it being a legal requirement, over a fifth (21%) of SME employers have no formal contracts in place for permanent employees, rising to 28% for those employers using freelance, contract or temporary workers.

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