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7 Employee Termination Letter Templates & Samples
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Table of Contents
A termination letter is a formal notice that an employee will be terminated from their existing position. A concise letter can assist the departing employee in adhering to internal HR standards, protecting the organization, and facilitating a seamless transition.
An employee dismissal letter is a valuable tool for the organization. Human resource officials and managers use it to conclude an employment relationship. While not all states need written notices, employing one allows managers to explain why they are ending their relationship with the employee. It highlights concerns that help businesses demonstrate that employee layoffs are just and lawful.
In this article, we will explain what should be written in a dismissal letter, provide some employee termination letter examples, and provide other details.
What is a Termination Letter?
A termination letter is a official notice issued by an employer to an employee, particularly when terminated. It is used as a formal notification to tell the employee that their job period has ended.
It usually states the reasons for termination, the effective date, specifics on severance or benefits, and any post-termination rights and responsibilities. This information is based on the organization’s termination policy.
This letter clearly and recordedly notifies the termination process, following human resource management standards and frequently considering legal and procedural factors.
What is Included in Termination Letter?
The termination letter includes the employee’s name, designation, manager’s name, and the main reason for termination. Employee termination occurs for various reasons, including poor employee performance, irresponsible employee organizational behavior, workplace misconduct, and a sudden loss of revenue for the company.
According to a report by NetSuite, companies lose 6% of staff because of poor employee performance.
Companies take appropriate procedures before terminating an employee, such as issuing a warning for gross misconduct or organizing Performance Improvement Programs (PIP) for poor performance. Thus, a clear letter of termination can assist the departing employee in following internal HR standards, safeguarding the organization, and ensuring a seamless transition.
Letter of Termination Types
These letters must reflect the circumstances of the firing. Employers often have three situations when they fire employees:
1. With Cause
an employee’s performance or behavior does not meet expectations or violates the employer’s code of conduct.
2. Without Cause
The company eliminates employees owing to broader market conditions, such as a revenue loss resulting in downsizing.
3. End of Contract
An employer who hires a short-term employee decides not to extend the contract after the initial term.
Importance of Termination Letter
A termination letter acts as official notice from the employer, just as a resignation letter would for an employee. It is crucial since it demonstrates professionalism and can be used as legal proof. When an employee is terminated, the organisation needs to follow a strict procedure. You need to hear them and also state the grounds of termination.
A termination letter notifies the employee of the cause for termination and outlines the procedure for making the decision. A decent dismissal letter should address the employee’s issues and seek to conclude the relationship amicably. Employees may file a legal suit against the organization in case of wrongful termination.
Components of Termination Letter
1. Employee Information
Include the employee’s details, such as their first and last name, contact number, and any other identifying information relevant to the employee.
2. Timeline of Events
Include a timeline of events before the separation. At the very least, it should specify the termination date.
3. Reason for Termination
Explain why you are terminating their employment to the employee.
4. Receipt of Company Property
If the employee owns any corporate property, the receipt of the company property document ensures that both parties understand what equipment the employee must return.
5. Compensation and Benefits Information
This category includes severance pay, supplementary compensation, and benefits.
Termination Letter Format
How to Write a Termination Letter
- Begin With The Date: Since you may be writing the letter on firm letterhead, the company’s name and address must be printed at the top. So, you can start with the date you drafted the letter. The date in the letter can be mentioned at the right or left top of the letter.
- Address the Employee: Use a formal salutation to address the employee. Include the employee’s name and surname in the salutation. Prepare a Proper Statement Of Termination: Make it clear that the company has terminated the employee’s services.
- Provide the Date of Termination: You must mention the date in the letter when the termination takes effect. This would be considered the employee’s last working day at the company.
- Include Reasons for Termination: List all of the reasons why the employee was terminated. In case of a termination without cause, fully explain the company’s viewpoint. If the termination is for cause, provide evidence whenever available.
- Explain the Settlement Specifics: Explain what wages and benefits the employee may be entitled to. These can be provident funds, pensions, leave encashment, or severance money. Inform them how to obtain their final paperwork, such as experience certificates and salary slips. If the employee insurance policy covers them, indicate whether the coverage will expire or continue until a specific date.
- Request Them To Return The Company’s Property: If the employee owns any business property, such as godown keys, laptops, mobile phones, or ID cards, ask them to return them.
- Remind Them About The Binding Agreements: For example, non-disclosure agreements and non-competition clauses remain in effect after an employee departs the organization. Make sure to remind them of any agreements that are still in force. You may also provide a copy of such agreements for their records.
- Conclude And Sign The Letter: You can end the letter with best wishes or express sympathy for the employee. The ending salutation could be ‘Sincerely’ or ‘Best Regards’.After you’ve printed the letter, make sure to sign it.
Termination Letter Templates
1. Simple Termination Letter Template
Date:
Subject: Termination Letter [Reason For Termination]
Dear [employee name],
This letter formally tells you that your employment with [name of the company] has ended, effective [date of termination]. The company decided to terminate the employment for the following reasons:
[List the causes for termination.]
Remember that the decision is definitive and irreversible.
You can be eligible for the following benefits:
[List the employee’s compensation and additional benefits.]
[Explain what would happen to the employee’s health care policy.]
Please return [list of things to be returned] by or by [date].
Please be aware that the following agreements continue to apply even after you leave the company’s employment:
[List the agreements and applicable clauses]
Please contact [name of the responsible employee] for further assistance.
With regards,
[head of the department],
[name and designation]
2. Employee Termination Letter Template Due to Poor Performance
Date:
To: [Employee Name]
[Contact name and necessary details]
Subject: Termination Letter Because Of Poor Performance
Dear [employee name],
This email follows up on our recent discussion about your performance in the [Job Title] role. We’ve been working together to improve your performance in [List 2-3 specific areas of concern].
We appreciate your efforts to improve your effectiveness in this capacity, especially with the assistance provided by [specific resources]. The [Job Title] position necessitates a particular set of skills, and despite our efforts to assist your development, we have been unable to bridge the gap to meet those criteria.
Therefore, after thoughtful consideration, we have decided to terminate your employment contract with [Company Name], effective [Date of Termination].
Next steps:
- Your final paycheck, including any accumulated vacation or sick leave, will be sent to your account on [Date].
- You will continue to have health insurance until [Date] (COBRA continuation alternatives may be available after this date). Please contact the HR department for information on your continuing benefits options.
- Please return all company property, such as your laptop and phone, to the HR department by [date].
We wish you luck finding employment that better suits your talents and ambitions. If you have any questions about your separation or benefits, please contact the HR department at [HR Contact Information].
Regards,
[name]
[designation]
3. Termination Letter Template Without Cause
Date:
Subject: Employee Termination Letter
Dear [employee name],
This letter formally tells you that your employment with [Company Name] will be terminated, effective [Date of Termination]. We truly appreciate your contributions to the company throughout your stay here.
Next steps:
- Severance Pay and Benefits: [If relevant, describe any severance pay or continuation of benefits, such as the date of your final paycheck and how to access COBRA alternatives for health insurance.]
- Final Paycheck: Your final paycheck, including any accumulated vacation or sick leave, will be posted straight into your account on [Date].
- Company Property: Please return all company property, such as your laptop, phone, and badge, to the HR department by [Date].
- Outplacement Services: [If applicable, discuss any outplacement services available to help in the job hunt.]
We recognize that this news may be unexpected, and we regret any inconvenience this may create. We wish you the best in your future endeavors.
If you have any questions about your separation or benefits, please contact the HR department at [HR Contact Information].
With regards,
[name and designation]
4. Letter of Termination for Ethical Violation
Date:
Subject: Termination Letter For An Ethical Violation
Dear [employee name],
This letter formally tells you that your employment with [Company Name] has been terminated, effective [Date of Termination]. This decision is based on a confirmed violation of our company’s ethics code, specifically [Mention which section(s) of the code were broken].
On [Date], it came to our attention that you engaged in [briefly outline the ethical infraction without going into too much detail]. This behavior constitutes a significant breach of trust and directly opposes the key values of honesty, integrity, and ethical conduct we expect from all workers.
We take such infractions very seriously because they can negatively influence our company’s brand and culture. Despite any attempts to rectify the infraction, such as an opportunity to explain the situation, we cannot condone this behavior.
Next steps:
- Final Paycheck: Your final paycheck, less any outstanding deductions, will be transferred directly into your account on [Date].
- Company Property: Please return all company property, such as your laptop, phone, and other things, to the HR department by [Date].
- We recognize that the news may be unsettling. However, maintaining a high ethical standard is critical to our organization, and this infarction results in your termination.
If you have any issues about your separation or last pay, please contact the HR department at [HR Contact Information].
Sincerely,
[your name]
[position]
5. Letter of Termination for Misconduct in Organization
Date:
To: [Employee Name]
[Contact name and necessary details]
Subject: Termination Letter For Organizational Misconduct
Dear [employee name],
I’m writing to inform you that your employment with [Business Name] will end immediately due to [particular misconduct or violation of business policies]. On [date], we discovered that you engaged in [briefly outline the wrongdoing without unnecessary detail].
Your acts have broken our company’s code of conduct and behavioral standards, and despite earlier warnings and opportunities for improvement, we will not allow such behavior in the workplace. We take such infractions exceptionally seriously because they might negatively impact our workplace, employee safety, and corporate reputation.
Please be aware that your final pay cheque, including any earned vacation or PTO, will be processed and given to you by our usual payroll schedule. Furthermore, it would be appreciated if you could return any corporate property, including [list of things], immediately.
Wishing luck for future endeavors.
Sincerely,
[your name and designation]
6. Termination Letter Due to Completion of Contract
Date:
Subject: Employee Termination Letter Due To Contract Completion
Dear [employee name],
This letter serves as formal notice that your employment contract with [Company Name] will expire on [Date of Termination], as specified in the agreement signed on [Start Date of Contract].
We value your contributions to the company throughout your time here. You have regularly displayed [Mention specific positive traits or achievements, if applicable] throughout your contract.
Your final payment, including any accrued vacation or sick leave (as per the contract), will be sent straight into your account on [Date]. You will be eligible for the perks. [If appropriate, include information about any benefit continuation options, such as the date coverage ends and how to obtain choices for health insurance.]
We wish you the best in your future endeavors. If you have any questions about your separation or benefits, please contact the HR department at [HR Contact Information].
With best regards,
[name]
[designation]
7. Termination Letter Email Template
Date:
To: [email of the employee]
CCBCC: [if any]
Subject: Termination letter [reason for termination]
Dear [employee name],
It is with great regret that I tell you of your immediate termination from [Business Name]. This decision was taken because of [enter reason for termination].
Please be advised that your instant firing is due to a significant violation of company policy and hence comes without warning or severance pay. You will be compensated for all hours worked up to when you were fired. As the law requires, you will also be paid for any earned vacation or sick time.
Before leaving the premises, please return any corporate property, including keys and equipment, to your manager.
We wish you success in all of your future endeavors.
Sincerely,
[your name and designation]
Termination Letter Samples
1. Simple Termination Letter Sample
Date: 13 December, 2023
To: Mayur Aggrawal
mayur.a@gmail.com
+91 8856291774
Subject: Termination Letter
Dear Mayur,
This letter formally tells you that your employment with Magnum Developers has ended, effective 13 December 2024. The company decided to terminate the employment for the following reasons:
- Your poor attendance at work
- Arriving late at work despite giving several warnings
- Not completing work on time
- Attitude and behavior toward the company
Remember that the decision is definitive and irreversible.
You can be eligible for the following benefits:
- You can claim your PF using the standard process.
- You will not be entitled to any health policy after the termination.
- Please return the laptop, attendance punch card, ID card, and other company property before 15th December 2024.
Please be aware that the following agreements continue to apply even after you leave the company’s employment:
- The non-disclosure agreement you signed will remain in force.
- You are not supposed to keep or share sensitive company data, or it will lead to legal offenses.
Please contact Rajan Mathur if you need any further assistance.
With regards,
Shrenik Singh,
Head – HR Department
2. Employee Termination Letter Sample Due to Poor Performance
Date: 1 July, 2022
To: Dhruv Mishra,
dhruvmishra12@gmail.com
+91 8755214987
Subject: Employee Termination letter because of poor performance
Dear Dhruv,
This letter follows up on our recent discussion about your performance as a sales executive. We’ve been working together to improve your product sales performance, but it has yet to work.
We appreciate your efforts to improve your effectiveness in this capacity, especially with the assistance provided by Mr. Ronak Majumdar. The sales executive position necessitates a specific skill set, and despite our efforts to assist your development, we have been unable to bridge the gap to meet those criteria.
Therefore, after thoughtful consideration, we have decided to terminate your employment contract with Royal Tech Group, effective 1 July 2022.
Next steps:
- Your final paycheck, including any accumulated vacation or sick leave, will be sent to your account on 5 July 2022.
- You will continue to have health insurance until 8 July 2022 (COBRA continuation alternatives may be available after this date). Please contact the HR department for information on your continuing benefits options.
- Please return all company property, such as your laptop and phone, to the HR department by 2 July 2022.
We wish you luck finding employment that better suits your talents and ambitions. If you have any questions about your separation or benefits, please contact the HR department at hr@royaltech.com or +91-8754922551.
Regards,
Disha Jain
HR Lead
Tips for Drafting a Professional Termination Letter
Prepare Thoroughly
Before meeting with the employee, ensure all relevant documents and documentation for the termination are in order. This contains a letter of termination, final paycheck computations, benefit details, and legal documentation. Schedule the termination meeting for a time and location that affords privacy while minimizing disturbance.
Give Justifications and Mention Policy Offenses
Provide specific reasons for the termination decision. Connect the reasons with past warnings, performance reports, and business policies. This demonstrates that the dismissal is fair and justifiable rather than arbitrary.
Focus on Administrative Management
Address practical issues such as returning business property, disabling access to company systems, and respectfully and orderly collecting personal belongings. Ensure that the employee understands the details of their leave, including the time frame for collecting their final salary and any other perks.
Include the Following Steps and Relevant Dates
Outlining the stages involved in the employee offboarding process can help create a closure. This will remind the employees of their responsibilities and the assistance available.
Provide Help and Maintain a Positive Employer Brand
Provide details about any assistance the company provides to the employee during this time. You can offer assistance with résumé writing, job search tactics, and networking possibilities. Reach out to the employee after the termination to show gratitude for their contributions and to provide continued help if necessary.
Hold the Meeting with Empathy and Honesty
Approach the termination meeting with empathy and understanding. Begin the conversation by thanking the employee for their contributions and recognizing the severity of the position. Use compassionate language and attentively listen to the employee’s concerns and responses. Explain the grounds for the termination to the employee in a respectful and non-confrontational manner. Please include concrete examples or evidence to back up your decision.
Proofread Carefully
Before submitting the letter, ensure it is accurate, precise, and error-free. Double-check information such as dates, numbers, names, and policy references. Have a second individual, such as an HR manager or legal counsel, review it too.
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Conclusion
A termination letter from your former company is an important document you may come upon. This official notice summarizes the end of your employment, including the cause for termination, your last day of work, and information about your previous pay and benefits.
Although it is not required in every instance, requesting a letter of termination provides sound evidence as you consider your next move. You can better appraise your current situation and future possibilities with accurate facts.
factoHR automates the whole organization’s employee procedures, from onboarding to performance and leave. Its sophisticated automation and straightforward procedures save time and ensure compliance, regardless of company size. Schedule a demo with factoHR now!
FAQs
How to Request a Termination Letter?
While employers are not legally compelled to give a letter, it is advisable to request one. If you require a letter, do not hesitate to seek one from your previous company. The best method is to contact your previous supervisor, the HR department, or the person who informed you of your termination respectfully and directly.
Do Employees Receive Pay after Termination?
Employees may be entitled to their final earnings upon termination, including compensation for hours worked, earned vacation, and other perks. Pay periods may vary depending on employment law and corporate policy. Whenever appropriate, severance compensation may be granted following the employment contract or business charter conditions.
What are the Three Ways to Terminate?
Employee termination can occur by resignation, in which an employee willingly leaves his or her work; termination by an employer, initiated due to business concerns, restructuring, or other reasons; or mutual consent, in which both parties agree to end the employment relationship. Each channel has a distinct description, such as a reporting period.
Do You Receive a Termination Letter if You Quit?
These letters are used for compulsory terminations started by the employer rather than voluntary resignations undertaken by employees. When an employee resigns, it is customary to send a letter to their employer, giving notice of their departure. The employer may then respond with an acceptance letter acknowledging the resignation and detailing the offboarding process.
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