What’s in a Termination Letter?
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When in business it is inevitable that you will be faced with terminating an employee at some stage. Whether it is due to unsatisfactory performance, misconduct or restructure, one thing remains the same, you will need to issue them a formal termination letter that clearly outlines that the employment is being terminated and why.
Termination Letter MUSTS
While each termination letter will be different, depending on the reason for termination, there are a few essential inclusions. Every letter must:
Clearly spell out that the contract of employment has ended,
Clearly spell out the reasons for termination,
Identify the last date of employment, and
Outline all entitlements to be paid out, i.e. outstanding wages, any notice period to be paid in lieu, any outstanding leave accruals.
Optional Additions
Depending on the circumstances, and the role of the employee, you may need to include:
A direction to return company property, this may include:
uniforms
equipment
information & data
Reminder of post-employment obligations, this may include:
obligations on termination
confidentiality
intellectual property
restraint of trade
privacy
And finally, termination letters should never be delivered without a verbal conversation first. Face-to-face is best but if this is not possible, particularly with a remote workforce, a video call should be considered, followed by a phone call. No employee should be faced with termination of their employment by email or text.