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.
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
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. 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.
By Andre Bradley