You may or may not realize that there is a right way and a wrong way to terminate someone, and a termination letter is probably the best way to go.

It’s not always easy to write a termination letter, but it is a necessity because the letter provides the details as to why and how the individual has been let go.

Termination letters also give the former employee any other information that might be needed as far as severance pay, exit interviews, and anything else that might be necessary.

Necessary Considerations to Include in a Termination Letter

If an employee is exhibiting poor performance, it makes sense that you’ll want to let that person go. Most people do understand that if they aren’t doing the work, then they don’t deserve to get paid. Unfortunately, you may have to detail the reasons for termination within the letter that you give to your soon-to-be former employee.

As you write the termination letter, you’ll need to be cognizant of legalities that could potentially cause problems. When in doubt, involve an attorney, especially because you’ll have no idea of knowing the way the soon-to-be former employee will react to termination.

You also have the option of writing a more simplistic termination letter that does not specify why the employee was terminated. Regardless of how you write the letter, you’ll need to remember to keep track of the steps you took before you arrived at termination as the only option.

Steps to Take Before Termination

Termination is an extreme reaction to someone’s actions in the workplace. There are certain instances where termination is the only viable immediate option, but more often than not, there are steps that you need to take as an employer so that the employee cannot claim wrongful termination.

As the employer, you need to keep track of all documentation that relates to any coaching sessions that may have arisen as a result of poor performance. Coaching sessions may include working with a mentor or even taking additional training.

Employers are also responsible for documenting employee efforts and improvements as well as keeping up with a performance plan. As the employer, you need to be able to show that you have tried every possible avenue before deciding that termination was the only choice left.

You may or may not choose to include a detailed narrative about the steps that were taken prior to termination in your termination letter. Check with your legal department to see if that would be in the company’s best interest or not.

Assuming that all steps have been appropriately documented prior to termination, then when the day comes where you need to terminate an employee, it will be time for the termination meeting.

terminated woman employee
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Details to Include in a Termination Letter

Once the termination meeting has taken place, you will need to deliver a termination letter to the ex-employee. The termination letter is meant to summarize everything that was discussed at the meeting. It also confirms any details surrounding termination.

If they are supposed to go to an exit interview, this is where you would remind them of that in writing. If they have turned in keys or access cards, that also needs to be included.

You should also include details like final payments, paid time off, and where to pick them up. If any outstanding benefits need to be addressed, those also need to be inside the letter. Giving this information to the ex-employee is essential to provide them with a handle on what is happening to them.

As an employer, you’ll also want to make sure you reiterate any non-disclosure or other legal agreements that were agreed upon in the beginning when the individual was initially hired. This is especially important because if you omit these things, you may face legal issues after the fact.

A copy of the termination letter needs to be added to the ex-employee’s personnel file as the final piece of employer documentation showing that all legal steps were taken before terminating the individual.

There are many different types of termination letters, too, that you may want to read up on because not every format fits the same type of termination.

Know When to Use a Termination Letter

If you’re not sure whether or not a termination letter is necessary, there are a few guidelines that you should follow to help you decide if one is needed.

Depending on your state’s labor laws, you may or may not be required to provide a termination letter. This is one of those things you’ll want to check on with your legal department because you may be legally required to give one to the person being terminated.

You also need to understand the eligibility requirements for unemployment in your state. If termination was caused by what is called “gross misconduct,” then the individual will not be eligible for unemployment. In the case of poor performance, you need to have a copy of the termination letter in your files in the event that the ex-employee were to file for unemployment because it will prove that the individual is ineligible for receipt of benefits.

Having a termination letter is also vital when it comes to having legal protection for your company. It all goes back to having the necessary documentation in place to show proof in case of any potential legal issues.

Termination letters are also the last line of communication with your ex-employee. They can help in providing a smoother transition for the individual by giving them something concrete to plan around. From the employee’s perspective, they feel better with having expectations in writing because the letter also functions as a point of reference for what they need to face.

Truthfully, there is never a reason to avoid using a termination letter. Even if the law does not require it, it’s still good documentation to have for the sake of the company. The bottom line is that you can’t have too much documentation in the event of a termination.

last day and employee termination
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A Few Last Words

Few people relish the idea of sending out termination letters to an employee. Unfortunately, it’s one of those things that happens every now and again.

As unpleasant as termination letters are, you may want to have a few templates in your arsenal to pull out when you need them. Hopefully, you won’t need them very often, but at least you’ll know you have them if necessary.

Remember, the best termination letters will protect your company from legal issues in addition to providing documentation for the ex-employee as to what to expect regarding pay, benefits, and whatever other information that is needed to ensure a smooth transition.

Whatever you do, always check with an attorney before you give a termination letter to an ex-employee, so you don’t have any nasty surprises later on.


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