An employer must think of hiring instead of firing but in business rules every now and then it becomes mandatory to terminate an employee. The termination is a part of business rules and it can also be voluntary on the employee’s part. The employment termination letter is written by the employer to dismiss or fire the employee in any organization, due to the poor performance or not meeting the threshold. The termination letter is also called pink slip or letter to fire an employee.
A termination letter must explain the reason, outline, and details of employee’s termination. The copy of this termination letter must be placed in the employee personnel file as well in the records of the HR department to avoid any conflict regarding the termination in the future.
Types of termination:
The employee may be terminated from the organization due to following reasons.
Dismissal from employment:
- Involuntary termination is the termination of an employee by the employer against the will of the employee. It is generally considered as the fault of the employee. Those that are terminated involuntary due to their poor performance and violation of company rules do not have any possibility to work in the same organization.
This type of termination is the employee’s decision to leave the organization due to any discomfort or dissatisfaction with the employer, excessive work or any other event in an employee’s personal life.
A firing takes place when the employer is not satisfied with the employee or there is any violation of company rules. Before firing the employee, the employer must give a warning letter and if there is not any improvement then without any further notification the employee is fired.
Lay-off is particularly associated with the profit of the organization or any business reasons. Sometimes due to the downfall of the organization the company needs to fire or terminate some of the employees. Lay-off does not deal with the performance of the worker. It can be a temporary or permanent suspension from the company. Lay-off is not an unfair suspension.
- This type of termination is offered to the employee by the employer to either give a voluntary termination letter or the company will fire the employee that eventually will have a negative impact on the history of the employee.
Voluntary resignation occurs when the employee feels that the given position might not fit his or her skills or there is any personal reason, for example, moving to another destination etc. This is an official notice that must be given two or three weeks before leaving the job depends on the rules of the organization.
This type of termination occurs when the contract or temporary appointment of the employee with the company is ended.
Employee retires when they reach the age of 65 or more depending on the state laws or business rules. Sometimes the employee is offered a part-time job even after the retirement.
How to write a termination letter?
Termination of an employee can be a relief but it is difficult at times in case of a forced layoff. But being a professional the writing must be brief enough that explains the reason for termination. Here is what you need to add in a termination letter.
The details of the employer and employee that include the name and the designation and name must be noted. The issue letter date and the termination date must be mentioned if they are different.
The Reason for termination:
Give your employee a brief notice that why are they been terminated. Sometimes it is not controllable by the HR department that leads to layoff as the company is going through a rough patch. In case of involuntary termination explain their poor performance or violation of rules etc as explaining the outgoing employee gives them their peace of mind.
Mention how many times they have been given the counseling, verbal warnings, or reprimand letters for their improvement in performance.
If the employee has something that belongs to the company such as a laptop, a car, or an apartment as a perk of employment then after the termination you can ask for the return of such company’s property, if the company wants them back.
Pay your employee what they have owned. Include what date they will be paid and how and where they will get their last paycheck for their work done for the organization. It is best to pay the employee then so that when the termination letter is signed the employment is officially over, and no further formalities are required.
Your work relation is over but you employee still have a future. So if the former employee has certain health benefits, insurances or retirement savings make sure to explain to them how they can access them. Let them know where their savings are and how they can handle with all this.
Sample employment termination letter
RE: employment termination letter for attendance
Dear [NAME HERE],
This letter is being written to inform you that the company has taken their final decision about your termination as a [Manager] at [company name] due to your [poor attendance]. You have been given many verbal warnings by Mr. [NAME HERE] and written warning by the department dealing how this is affecting your work but you did not pay heed to them and did not improve your routine.
The company needs teamwork to improve and grow in scale but your attitude becomes the failure of an entire team, as you barely work three to four days a week. Teamwork is not possible with this attitude.
At the termination meeting, we have already received the company owned laptop and office keys from you.
Your final paycheck will be mailed to your email address. Your health care benefits will remain active for two months.
Thank you for rendering your services to our company. We wish you luck for the success in future.
Preview and Details of Template
Employment Termination Letter Template
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