Before assuming some roles in a company, the employees will often sign an employment contract that among others specifies how long they are to work for that organization. However, some circumstances may arise that demand that the employee’s contract is terminated prematurely. If and when such circumstances do arise, an employee termination letter has to be drafted.
This is a letter that basically seeks to notify the employee of an untimely termination from employment. It basically confirms the finer details of the firing and summarizes the pieces of information your employee needs to know before stepping out of a job.
To be able to draft a quality termination letter, there are a number of things you have to factor and take good care of. Here below, we delineate and explain the steps you have to follow to be able to end up with a nice write-up:
- Identity of the Firing Company
Kick start the exercise by disclosing the identity of the firing company. Identity here refers to the name of the company, its physical address, and the uniquely identifying pieces of information. Follow this closely by specifying the date when the letter is to be deemed to have taken effect. Use a company letterhead for the job.
- Precise Reasons for the Termination
Now get to the core of the exercise. Right here, you ought to state the precise reason for the termination of the employment. These reasons need not be general and have to be referenced against the rules that govern employment. Before drafting such a letter, the employee may have been warned repeatedly. Refer to these warnings as well in the letter.
- Outstanding Dues and Benefits
During active employment, the employee is generally entitled to a number of benefits and perquisites. You should mention how these benefits are going to be handled in light of the premature termination of the contract. Yet again, you have to refer extensively to the rules and laws that govern the benefits. In some cases, the litigations may spill over to the courtrooms.
- Appeal for the Termination
Employees do have the right to appeal any untimely dismissals. The letter should also acknowledge that and give the employees a window of appeal. In most cases, employers can limit the time an employee would take to file an appeal. In the absence of that, 14 days are deemed the most suitable.
- Relevant Signatures
As with any other official document, this letter has to be signed and dated appropriately. After furnishing these signatures, several copies of the document have to be made. Each party has to be furnished with copies for the sake of future references and handling.
What should be included in a Termination Letter?
- The date from which the termination is to take effect
- The core reasons why the termination is inevitable or has been settled on
- An explanation of how the compensation and the resultant benefits are going to be handled
- A listing of the pieces of property that the company owns that have to be refunded
- A reminder of any separate agreements or treaties that the employee entered with the employer if applicable.
- The contact details of the human resource representatives
Employee Termination Letter Format
_________ (Employee name)
This is to notify you that we have decided to terminate your employment with our company _ (name of company) with effect from _____ (mm/dd/yyyy).
Below are the grounds for your termination:
_____________________________________________________________ (ground one)
_____________________________________________________________ (ground two)
_____________________________________________________________ (ground three)
_____________________________________________________________ (ground four)
_____________________________________________________________ (ground five)
Notwithstanding your dismissal, you are still entitled to __ (list the benefits and perks applicable)
On the same note, we want you to return every property that belongs to the company. We are also privy to the agreements you have signed with the various clientele. Kindly note that they stand nullified henceforth.
Kindly note that you have 14 days to lodge an appeal in line with the existing employment acts.
_________ (HR Manager)
Sample Termination Letter
March 9, 2022,
Kalmar Foods Incorporated,
11083 Parkside Drive,
Knoxville. TN 37934
RE: Notice of Termination of Employment
We would wish to let you know that you stand fired from your place of work. This is a decision we have been compelled to take after our two previous warnings went unheeded.
The grounds for your termination are:
• Prolonged and uncontrolled lateness to duty
• Inability to cope and blend well with other workers
• Failure to meet set targets and deadlines
• Repeated complaints from customers
We are aware of our enrolment in our retirement benefits scheme. Kindly let us know in writing when and where you want us to remit the funds.
Every contract you entered or are currently pursuing stands null and void. We shall not be held responsible for any liabilities arising from the same.
Please note that the existing labor laws give you the leeway to appeal within 14 days. Take advantage of it if need be.
For any issues, kindly speak to the line manager.
All the best in your future career undertakings.
Human Resources Manager
When to write an Employee Termination Letter
- Incapacitation. If and when an employee is no longer capable of performing the duties that he is assigned or expected to, the most logical thing to do is fire him from employment. Retaining him in the company might only lead to financial losses as you will be paying for work not done.
- Inability to Integrate to the Organizational Culture and Ethos. Before one can perform the duties and responsibilities that come along with his job description, he must integrate well with the organizational cultures and ethos. These are rules and principles that given the day-to-day tasks and activities of the firms. The failure to integrate fully might also warrant a dismissal.
- Violation of the Company Code of Conduct. Integrating, in and of itself, is not enough, the employee must also adhere to the codes of conduct that govern the tasks and activities that the company engages in on a daily basis. The violations of these codes of conduct are yet another strong point for a dismissal.
- Thefts and Corporate Malpractices. Employees who engage in thefts and other corporate malpractices no doubt have to be shown the door. Such practices are no doubt an abomination as they eat away some company profits not to mention portraying the same in a bad light. Do not take any chances to terminate the employee who engages in such.
- Failure to Honor Commitments. Apart from the core business of working for the firm, an employee has to honor some commitments. These include showing up to work in time, honoring appointments, handling tasks within the allotted timeframes, and being there when needed. Any failures to do these may also warrant an untimely dismissal.
Frequently Asked Questions (FAQs)
NOT really! Under the existing Fair Labor Standards Act, a company is under no obligation or mandate to notify an employee of impending termination. The only exception is if that employee is a part of a union or collective bargaining agreement.
There is no fixed formula. However, the standard practice is that the employee ought to be notified by direct mail that is addressed to him alone. E-mails may also do. However, verbal communications are strictly prohibited.
Some of the reasons for fair dismissal are:
• Poor performance
• Breach of confidentiality
NOT really! The affected employee may opt to seek legal redress in lieu of signing the termination letter. Also, no employer can force an employee to do so. Taking such an approach may be detrimental to the affected firm.
The exact notice periods vary largely with the employment periods. 1 week would be enough for an employment contract that lasts less than a year; a fortnight for 1-3 year contracts; 3 weeks for 3-5 year contracts; and a month for over 5-year contracts, and so on.
Never use a termination letter for those circumstances that are not covered or provided for under the existing labor laws and practices. Those will trigger unnecessary litigations and put you on the warpaths for naught.
NOT at all! Discharge refers to sending an employee home after the contract obligation comes to an end. Termination, on the other hand, entails ending the employment relationship prematurely before the set time to do so finally comes.