A termination letter is used to notify the receiver that the contract or agreement between them is terminating. Terminating a letter template is used when you make a decision to fire an employee from your company or organization for the betterment of the business. Terminating an employee is a crucial task; if you are unsure about it, then you can see samples of termination letters to employee templates to write them in a better way.

A termination letter is also called a letter of contract termination, letter of separation, letter of employee termination, and letter of termination. A well-structured letter helps you to prevent any disputes, browse our collection to find termination letter samples and templates that contain all the essential elements that allow you to handle this task properly. See below to understand more about it. 

Download Free Termination Letter to Employee Templates

What is a termination letter?

A notice of termination is used to inform the notice receiver about the termination of the contract. When an employer wants to fire an employee with a cause or without cause, he/she sends a letter to notify him about job termination. It contains the information about the benefits he/she receives after the dismissal, the date of the termination, and the steps the letter receiver takes after receiving this. It’s better if the employer arranges a meeting with the employee and tells him about the process of termination; this step of the employer makes this process easier. Before writing the termination letter, whether it is for employees, lease termination, service termination, and any contract cancellation consult your lawyer to take some legal advice that helps you to prevent any legal issues.

For the development of the business, the performance of each employee matters; if an employee gives poor performance or always being late, then it directly affects the company’s development. The reason for terminating an employee should be included or not in the termination letter is totally up to you. If you decide to mention the terminating reason in the notice of job termination, then you should collect some solid evidence from the employee profile that supports your cause. If you are unsure about the termination letter and don’t know how it looks, then you should download a sample of an employee or contract termination letter that helps to guide you. Now, it is easy to create it by downloading a free letter of termination template and making it with the help of samples.

Things to include in Termination Letter

The termination letter should be written appropriately and must contain all the essential things that make this process easier. If an element or some elements doesn’t include properly by the sender, then it creates disputes and misunderstandings between the sender and receiver. Below we share some essential elements that should be included in every termination letter. You can understand this letter and its elements with samples of it; in our collection, you can easily find the termination letter of the vendor, lease, job, service, and other different types of samples and templates that you want to create. Some necessary components of an employee termination letter are as follows:

  1. Sender’s name, address, email address, and phone number. 
  2. Receiver’s name and address. 
  3. The date when the contract will end. 
  4. Write about the benefits or compensation he/she received.
  5. Notify the receiver to return the things he/she received during this contract. 
  6. Remind the letter receiver to sign this letter. 
  7. The reason for terminating this contract should be included in it if you want. 

The above things are essential and must be included in every separation letter, but according to your needs, you can add additional information to it by consulting a legal advisor.

How to write the Termination Letter?

Writing a termination letter from scratch is not an easy task; an example of a termination letter helps you to design it properly. You should make sure to follow the standard format of it and see the templates to create it in an appropriate way that reduces the risk of disputes and misunderstanding. Before writing the termination letter, collect all the essential information of the sender. Below we share some steps to write the termination letter:

  1. First of all, write the date when you send this letter on the left side of the paper.
  2. Add the name, address, and other information of the receiver under the date. 
  3. Add the information of the sender. 
  4. Add the salutation; it may be formal or informal. Write the name of the receiver followed by “Dear,” “Mr,” and something else that you consider is best. 
  5. In the first paragraph of the letter, state the purpose of writing this letter with reference to the agreement or contract that they have signed. 
  6. After writing the purpose, write the date of the contract. 
  7. In the second last paragraph, state the benefits and compensation he/she received with the guidelines for the receiver to move forward and send him a copy of the record or document for review. 
  8. In the last paragraph, use some positive words and remind him to sign the terminating contract document. 
  9. To make this letter valid, sign it to the sender. 

Make sure the letter should be error-free and write it clearly and concisely. If you want to establish a great relationship after the termination of the contract, then keep positive in your words or tone and write a soft termination letter because the tone of the letter directly affects the reader.

Types of termination letter

There are different types of termination which are used for various purposes. Some basic types of termination letters are as follows: 

  1. Voluntary termination letter: It is the main type of termination letter where employees send a letter of resignation to inform the employer that they are leaving the job. It may be the two-week notice letter according to the company policy where an employee works for two weeks as an employee in the same position after sending the resignation letter. When an employer accepts the resignation from an employee and sends the letter When an employer sends a letter of employment termination when he/she accepts the resignation is called a voluntary termination letter. 
  2. Involuntary termination letter: Involuntary termination letter is sent by the employer to the employee to notify him that he/she has been fired from this company, it may be with or without cause. It is up to the employer to mention the reason for terminating the employee from the job. 
  3. Termination of tenancy letter: A tenancy termination letter is used by the tenant to notify the landlord that they are going to leave their property before the date of ending this agreement due to some reason. This letter contains information about the property they owned, information about the tenants, and the date when the tenants plan to hand over the property to the owner. Make your work easier by downloading the tenancy termination letter samples and templates that help you to write it correctly. 
  4. Service termination letter: A service termination letter is used to notify the sender that they don’t want to take the service or provide the service to the letter receiver anymore. This type of termination is widely used in the corporate sector. 

Employee termination procedure

Employee termination is an awkward step, and sometimes it creates disputes and problems for both the employer and the company. Before sending a termination letter, you should take some steps that help you to prevent any legal issues. Below we share a few steps that you should consider for terminating an employee. 

Step 1: Send a warning letter: Before sending a termination letter directly, it is vital to send a warning notice letter to the employee and give him a second chance to prove himself.

Step 2: Consult your lawyer: It is essential to take advice from your lawyer before sending a termination letter to the employee to avoid and handle any disputes. 

Step 3: Complete your paperwork: Read the contract that has been signed between you and your employee, and collect evidence that supports your rights to fire any employee from the company.

Step 4: Arrange a termination meeting: It is unfair to directly send a termination letter without arranging a meeting with the employee you are going to fire to inform him verbally about his/her termination.

Step 5: Send termination letter: After informing verbally to the employee now, the time is to send a notice professionally about the termination.

Step 6: Final payback: Sends final payback to the terminated employee as soon as possible. 

Step 7: Update employee records: When the terminated process is completed, update the terminated employee profile that may be used in the future.

Reasons to write an employee termination letter

When an employer writes a termination letter with cause to the employee, it seems complicated when you are unsure about the format of it. There are various reasons for terminating a worker from a job. Some ideas are as follows:

  1. Termination letter for poor performance: The development of the company or organization depends on the performance of employees. When an employee gives poor performance and doesn’t correctly accomplish the task and responsibility, then termination is the only solution for the betterment of the company. Take the idea of writing it from samples of termination letters for poor performance available in one click. Employees are valuable assets of a company, and when they work hard for the development of the company, then the employer should appreciate them with a recognition letter
  2. Termination letter for misconduct: Another solid reason for terminating an employee is the behavior of his/her with the office staff. If an employee behaves improperly, then an employee termination letter for misconduct is sent by the employer. See the samples of this letter to write it in an appropriate way. 
  3. Termination letter for redundancy: This type of termination letter is written by the employers to the employee when they get hired by a person who does the same job that the terminated employee does. We make your work easier and share examples or samples of employee letters of termination for redundancy that guide you to write it according to the standard format and also share the templates to write it. 
  4. Letter of termination for stealing: An employee’s letter of termination for stealing is used when an employee takes something without permission from the office with the intent of not returning it.

Tips for writing the termination letter 

Some tips help you to write this letter effectively. 

  1. It should be free from the spell and grammatical errors. 
  2. Consult with your legal team before sending the termination letter for legal advice to avoid any issue that may be raised due to terminating the employee.
  3. Be specific and concise in your words, and the tone of the letter should be professional. 
  4. Use some positive words like “Best of luck” at the end of the letter. 
  5. Attach a copy of the evidence that supports your reason for termination.
  6.  Remind the letter receiver to sign the termination documents. 
  7. Explain the steps to take after receiving this letter. 
  8. Write this letter by following the standard format.

Frequently Asked Questions

Is it compulsory to sign the termination letter by the employee?

No, it is not compulsory to sign the termination letter by the employee because it doesn’t affect the termination.

Difference between voluntary and involuntary termination letter?

A voluntary termination letter is an acknowledgment from the employer when an employee sends a resignation letter, whereas the employer sends an involuntary termination letter due to some reasons.

What are the essential components of termination letters?

It should contain the sender’s information, the receiver’s information, contract termination date, information about benefits, and compensation.

Difference between termination and resignation?

When an employer fires an employee from a job and sends a letter to notify him is called a termination letter. Employees send a letter to the employer to inform him that he/she leaves the job is called a resignation letter.

Does an employer need to write the reason for termination in a letter?

It is up to the employer to write the cause of termination.

Is it better to resign or be terminated?

For the reputation of an employee, it is better to resign from a job instead of being terminated.

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