There are many reasons why an employer may want to terminate an employee, but the three main reasons are poor performance, misconduct and redundancy.
An employee termination letter is the opportunity to explain the reasons for the termination and give other details about the termination.
This letter will help protect the employer if any legal issues arise in the future. If an employee wants to fight a termination, it can cost the company thousands of dollars, so it is important to have a written record to show that all the legal issues were covered.
Employer Needs To Be Professional
Sometimes it is a relief to end the employment of an employee and sometime is it very difficult. In both cases, the employer needs to be professional. It is easier on the employee if they are spoken to personally first, so the letter is not a shock to them.
The letter should contain:
- The name of the person being terminated, the name of the company and the date when the termination becomes effective
- The reason for termination including forced lay off, verbal abuse, excessive tardiness or other
- If the employee has been warned verbally or in writing before the decision to terminate him or her, this should be mentioned. This includes any work evaluations that may have alerted the employee that their work is not up to standard
- Any company property such as a laptop, car keys or a key card should be returned by the employee. The employer should make sure the item wasn’t given to the employee as a perk
- Any accrued vacation time that requires payment or other pay needs to be mentioned along with a date the payment will be made
- If health benefits have been provided, it should be mentioned how this will be handled.
Before writing the employee termination letter, the employer should gather the following documents:
- The employee’s contract
- Any non-disclosure agreement
- An independent contractor agreement
- The employee handbook
standard business format
The letter should follow the standard business format. It should thank the employee for their service, and, if applicable, it can mention any specific event or positive accomplishment about how the employee was a benefit to the company.
The reasons for termination should be express very carefully because this letter will remain in the employee’s record.
If the termination is because of redundancy, the employer needs to make sure they know the employee’s rights pertaining to trade unions and other organizations.
This means getting advice from a qualified person for the company’s locality to make sure all legal aspects are covered.
letter needs to be compassionate
The letter needs to be compassionate and other employees who are not terminated also need to know the reason for the redundancy termination especially if it is large-scale.
For misconduct or unsatisfactory performance, it is essential that the employee has had sufficient time and warning to change their behavior or improve their performance.
If they don’t do either and termination is required, it should first be done in person, so the employee can be shown the various times they were warned.
Here are sample employee termination letters. Even if the employee is aware that they are being terminated, the letter should be sent by certified mail, so the employer has a record of the time and date that the employee received the letter. This could be important if any legal issues arise later.
Sample 1 – Employee Termination Letter Without Cause
Employer or Human Resources Person’s Name
City, State, Zip Code
City, State, Zip Code
RE: Employment Termination Letter
Dear Name of Employee,
This letter is formal confirmation of our discussion today about your termination of services for this company. As mentioned in the meeting, two departments are combining and your services will no longer be required.
It was also mentioned that your work for this company was excellent. The termination is effective immediately.
A release of claims document is enclosed for you to sign and return to me. Once you have done this, you will receive two weeks severance pay in accordance with our company policy for employees who have been with the company less than one year.
Along with your severance salary, you will receive any Paid Time Off that you have accrued. This will be available on our regular pay day at the reception desk. If you prefer, we can mail it to your home.
In another letter, you will receive information about the status of your benefits including your eligibility for Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation of group health coverage.
At the termination meeting you gave your security swipe card, office key and the company-owned laptop.
If your contact information changes, you must update the company, so we can send you any information such as your W-2 form.
Please let me know if we can help you in any way during this transition period.
Signature of Human Resources Representative or Company Owner
Printed Name of Human Resources Representative or Company Owner
List of Enclosures
Sample 2 – Employee Termination Letter With Immediate Effect
Mr. Aaron Williams
1060 Revello Drive
Madison, WI 53719
Dear Mr. Williams:
This letter confirms our decision pursuant to our discussion today that your employment with State Street Family Chiropractic, Ltd., is terminated effective immediately.
As you have been employed with State Street Family Chiropractic for more than one year, you will receive two weeks’ severance pay, which will be paid to you once you have signed and returned the enclosed Release of Claims document.
Your accrued vacation time will be paid at your current hourly rate and paid with your next paycheck at the end of our regular pay period, next Friday, January 18.
You may pick up your check in the business office, or if you desire, we can mail it to your home. You will be mailed a separate benefits statement explaining the status of your benefits after termination.
Thank you for returning the company-owned pager and building keys at the termination meeting. Please keep your contact information up to date with the business office so that we can provide you with tax documents when they become available.
Please let us know if we can assist you in any way during your transition.
Practice Manager, State Street Chiropractic, Ltd.