What Are HR Policies and Procedures for SMEs?


HR Policies and Procedures set out how we implement employment law and standards within the company. Their purpose is to provide guidance for action. An employee and a manager should be able to obtain from the policy how they should act in a given set of circumstances and how the company should react in a breach. In other words, they aim to ensure consistent, transparent decision-making that is understood by all. 

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Why are HR Policies and Procedures important to SMEs?

HR policies are critical to the management of the organisation whether it is in ensuring compliance with employment legislation or in managing behaviour. The quality of HR policies and their application is a strong indicator of whether your business is being effectively managed and the type of employer you aspire to be.  

Well-crafted and managed HR policies should be an important asset supporting consistent decision-making, good communication and appropriate behaviours.

What are the main areas that need HR Policies and Procedures?

Staffing – recruitment/ selection, contracts, probation, records, equality/ diversity, record keeping

Compensation – salaries, benefits and expenses

Performance management – performance reviews, disciplinary measures, dismissal, exiting, grievance and professional development

Conditions of work – hours of work, overtime, leave, flexible working, health and safety etc.


Since engaging HR Duo, our ability to manage has improved, our control of our environment is better and our management information in a multi site business allows us better decision making.


How should a well-crafted set of Policies and Procedure interact with my business?

They should be integrated with and support each other e.g. discipline supports performance management which supports compensation.


They are developed in conjunction with you and and they ensure flexibility in the application of policies to meet your specific business needs.


Good HR policies and procedures operate on two levels:

- a compliance approach based on the requirements of legislation (working time, contracts, maternity leave etc.) and

- a behavioural approach building on legislative requirements, relying on management discretion to make consistent decisions based on principles and values that are well communicated and understood (e.g., policies on social media or equality policies).

Well-crafted and managed HR policies should be an important asset supporting consistent decision-making, good communication and appropriate behaviours.


What policies and procedures should an SME have in place?

The policies required by a business vary depending on the nature of the business.

The complete answer is that it you should have appropriate policies in place to enable your business to be compliant with employment legislation and which promote best practice management and employee performance and effectiveness. All businesses, whether a multinational or a local chip shop must have similar policies and procedures to demonstrate compliance with employment regulations. Unfortunately, notwithstanding the large gap in resources, both organisations are required to be compliant.

What is a sample policy listing for a business?

The following list is intended to give a sense of different Policies and Procedures that could be included. It is not intended as guidance or as advice. The precise listing for a business should reflect the nature of operations and the management outlook and desired culture.

  • Probation

  • Sick Leave

  • Health and Safety

  • Discipline

  • Grievances

  • Harassment

  • Security vetting

  • Absence

  • Parental Leave