Curious to see how to frame a termination letter for an employee? Keep reading to discover multiple examples of termination letters.
With a growing workforce, termination letters are a staple at every job. Many employees tend to miss the mark with their performance, show tardiness, or genuinely don’t seem interested in working for their company anymore.
What is a Termination Letter?
A termination letter is a standard notice from an employer to disclose to employees that they are being dismissed from their job. A termination letter includes information regarding the reason for dismissal, benefits or severance pay they may receive, the date of their final paycheck, and other relevant details.
How to Write a Termination Letter?
Letting someone go is complex, and a termination letter is key to ensuring employees don’t feel cheated or degraded. If your disciplinary or evaluation processes work well, the employee should have had some forewarning that termination may be coming.
Make sure to set a concise meeting with the employee to let them know they are sacked before you send them an official termination of employment letter.
There are similar cases where you need to let go of employees temporarily – this is also known as furloughing. Employee leave is a partially paid or mandatory unpaid time-off during which employees are usually qualified for unemployment and other benefits.
Several reasons may lead to layoffs, for example, reduction of overhead costs or administrative restructuring. As an HR professional, make sure to let employees know about the layoffs through an employee furlough letter.
Make sure to craft the termination letter with two elements: tone and compliance. It is in everyone’s best interest to close the working relationship with the employee on amicable terms, and a fully obliging termination letter helps decrease the chances of lawsuits.
Take into consideration these factors when drafting a termination letter:
- Discuss with a lawyer to ensure you are legally allowed to terminate this employee and learn more about relevant terms. For example, in some countries, you must give ample amount of notice, reasons for termination, and severance pay.
- Decide on what the final day before the termination or furlough should be with their unit supervisor or department head.
- Collect all procedures that are in effect after an employee has been terminated or furloughed, so you can remind them in your letter.
- Be conscious of the tone, be tactful but firm. If feasible, ask a fellow HR coworker to read the letter and let you know if anything sounds wrong.
- Let the employee know the date of their termination.
- State the precise and detailed reason(s) for his/her termination.
- Mention compensation and/or benefits, if any.
- Notify that they must immediately return all company property.
- Take them through important and applicable clauses or terms in their signed agreements.
- Include the company’s HR contact details if they or their future employer would need to get in touch.
Why is a Termination Letter Important?
As unfortunate as it is, the reasons for going out there and getting the termination letter are significant.
- The termination letter states the employer’s justification for terminating the employee, in detail, if necessary. If the individual has a termination letter outlining the grounds for the firing, the company will find it more difficult to subsequently modify its narrative.
- The date of termination is specified in a termination letter. It is critical since there are several deadlines for filing complaints against an employer in case of wrongful termination. Employers frequently suggest that employees have failed to meet a deadline and are, thus, barred from pursuing claims.
- The termination letter debunks claims that the worker resigned. Some companies may argue that they did not fire an employee and that it was the employee who freely departed or abandoned their employment. It is commonly done for strategic purposes to avoid blame. Nevertheless, if the employee receives a termination letter, the employer cannot claim that the person was never let go.
- Helps avoid situations in which a previous employee claims they were fired without reason or awareness.
Basic Sample Termination Letter Template
I regret to inform you that as of [termination_date], you will no longer be employed with [company_name]. We think this is the soundest decision because of [insert reason for termination].
From [termination_date] on, you won’t be qualified for any payment or benefits associated with your role. Therefore, please return [company possessions that must be returned] before [date] to the Human Resources office.
You are entitled to your salary until [termination_date], and we will compensate you for your remaining vacation days. In addition, we will also offer severance payments that will amount to [amount]. [You will receive a separate letter with the entire details of the settlement or other corresponding information you are permitted to receive from us].
Please remember that you have signed a non-compete, non-disclosure, and non-solicitation agreement. If you have any knowledge about our employees, customers, or other stakeholders stored on paper or your appliances, you must remove it immediately.
If you have clarifications or questions, I am at your disposal for up to [five] working days after your last day of employment.
We wish you the best of luck.
[Your name and signature]
Poor Performance Termination Letter Template Example
I am saddened to inform you that as of [mm/dd/yy], you will no longer be employed with [company_name], and this is your contract termination letter. As examined, the reasoning behind this is your receded performance over the past six months.
We made this judgment after the end of your Performance Improvement Plan, which we embarked on [mm/dd/yy]. From [date] on, you will not be qualified for any settlement or benefits associated with your appointment. Please yield your swipe card, organization cell phone, and laptop by [time] on [date] to our HR office.
You are authorized to your salary up until [date], and we will recompense you for your remaining vacation days. We will also provide severance pay that will amount to two monthly salaries. You will receive a separate letter with the complete compensation details and information about your health coverage.
Please remember that you have signed a non-compete, non-solicitation, and non-disclosure agreement. Therefore, if you have any information about our customers, employees, or other stakeholders stored on paper or on your devices, you must remove it immediately.
I am at your disposal until the end of next week if you have any questions.
We wish you the best of luck.
Sample Employee Termination Letter Due to Prolonged Absence
Few employees go on an unexplained leave of absence for prolonged periods, wherein they are uncontactable, or there are no signs of returning to the organization. This is highly unacceptable behavior as per any company rule. Therefore, here is a termination letter to send out to such employees.
Subject: Employment Termination
It is our unfortunate duty to inform you that this letter confirms that your employment with [company name] stands terminated from [ termination date].
The reason for termination is the multiple unexplained and uninformed leave of absence from work for prolonged periods that you have taken.
You will receive your entitled severance package as per company policy. In addition, you will receive a statement detailing your accrued benefits.
[Name of HR executive] will discuss the final details with you as well as answer your question or doubts, if any. Kindly contact him/her at the earliest opportunity to discuss your termination process and final package.
This action by us was deemed necessary. We wish you success in your future endeavors.
Employee Termination Letter for Probationary Employee
Employers usually hire employees and keep them on probation for the initial few months before confirming their employment.
This probation period generally lasts for 90 days or three months. It, however, depends on company to company. Suppose the performance and professional conduct of the employee are not satisfactory and fall below the company expectations. In that case, they are given an employee termination letter to relieve them from employment with the company.
[Name of Manager]
Dear ABC [Recipient Name],
We acknowledge and recognize the effort you’ve put into your job role as during your probationary period with [firm name].
Regrettably, the results did not meet business expectations. Accordingly, we inform you that your employment with (firm name) is terminated effective today [or add date].
We will be processing your outstanding salary and your Record of Employment on the next scheduled payment date [add date]. These documents will be mailed to your home address.
We hope you the best in your forthcoming endeavors.
[Name of Manager]
Furlough Letter Example
I am apologetic for notifying you that your placement will be put temporarily on furlough due to urgent business circumstances from [date] to [date]. Hopefully, we will be able to mend your employment after this critical time.
Here is what to expect:
- During this time, you will not acquire any payments from the company. You must also thoroughly withdraw from your working duties.
- The company will persist in paying for your health and car insurance.
- You may be qualified for unemployment benefits under specific criteria.
- Your present PTO balance will stay the exact same.
We commit to doing our finest to bring you back again soon. If you need any more clarity, feel free to contact me or [name].
We wish you the best of luck.
Conclusively, companies should put special focus on drafting termination letters that acknowledge the employee’s contribution, are considerate about their situation, and still convey the company’s message. Employee termination letters are a must-have for all organizations.
Here are some of the most common questions about termination employment letter templates.
1. When Should You Not Use a Termination of Employment Letter?
It is difficult to imagine that situation. While it may be appropriate to cite a reason for termination in an employee’s individual termination letter, if the company’s letter of termination or separation agreement leaves off the reason, it is best not to supply that information in a separate email to the employee.
2. Will My Organisation Require an Employee Termination Form?
Large companies that terminate employees will require an employee’s signature on a termination form. A typical notice includes the employee’s name, department, position, and date of termination.
3. What Are the Circumstances Under Which an Employer Can Dismiss an Employee?
- Redundancy and misconduct.
- Issues with capability or performance
- Violating statutory restrictions
- Other substantiated reasons, such as a fixed-term contract expiring, serious personality clashes that affect the business, or an irreconcilable conflict of interest
4. Must I Give a Reason for Terminating the Employment Contract?
While there is no law that requires employers to give reasons for terminating employees, it is wise to document any reasons and supporting evidence when terminating someone because doing so can help protect your company from lawsuits.
5. Is the Human Resources Department Present When an Employee is Fired?
It is usually unnecessary for human-resources personnel to be present at a dismissal. But if you have a human resources department, it will probably take advantage of its experience in the field. We can help you follow the best practices for a successful dismissal.
6. Can an Employer Terminate an Employee Without Giving Prior Notice?
An employee can be terminated without notice if they engage in serious misconduct, which includes activities such as wilful and deliberate misconduct that is considered contrary to the employment agreement or illegal or dangerous activity that threatens the health and safety of others or damages a company’s reputation.
7. Is It Against Company Policies and Procedures to Terminate an Employee Over the Phone?
Unless there is a medical emergency or an employee’s actions pose a threat to other employees, you should not terminate an employee by phone. If, however, there is an urgent need to discuss termination or if the situation necessitates it, then you can either revoke an offer of employment or give an employee notice of termination if the two of you are in the same location.
If the situation does not allow for an in-person meeting, then you should discuss termination by phone only if you have already confirmed that the employee understands they may be terminated over the phone and has waived his or her right to have the conversation face-to-face.
Additionally, you should err on the side of caution and seek professional advice before deciding to terminate by phone.
8. Is Early Termination of an Employment Contract Possible in Some Circumstances?
In some countries, employment contracts are generally open-ended and do not expire until the employee or employer wants them to. In these cases, it is always possible for an employer and employee to mutually agree to end the contract before its intended expiration date, though it is not necessary that they do so if both sides are satisfied with the arrangement.
An employer must still give a valid reason why they wish to end the contract early and must ensure that they engage in a fair process with their employee.