Termination Letter Template 2025

We created a free termination letter template that you can fully customize to match your company’s tone, HR procedures, and legal requirements.

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What is a Termination Letter?

A termination letter is a formal document issued by an employer to officially notify an employee that their employment is ending. It clearly outlines the termination date, the reason (if applicable), final pay details, and any post-employment instructions. This letter helps maintain transparency, provides legal documentation, and ensures the termination is communicated respectfully and professionally.

Why is There a Need to Provide a Termination Letter?

Providing a termination letter is crucial for several reasons:

• Legal Protection: It serves as a written record of the decision, helping prevent or manage disputes.
• Professionalism: It maintains a formal tone and shows the employer’s commitment to fair and respectful HR practices.
• Clarity for the Employee: It outlines next steps, such as final pay, return of company property, or benefits status.
• Documentation Trail: It supports the employer’s internal records and can be attached to performance reviews or disciplinary warnings, if applicable.

What is Included in a Termination Letter? 

A well-structured termination letter typically contains the following:

• Employee’s full name and job title
• Termination effective date
• Reason for termination (e.g., performance, redundancy, contract end)
• Final compensation and entitlements (e.g., unused leave payout, final salary)
• Information on the return of company property
• Details on benefits continuation, or cancellation
• Exit process instructions
• Employer’s contact information

What are the Common Reasons Leading to Termination?

While termination can occur for various reasons, some of the most common include poor performance and chronic absenteeism. In such cases, it’s standard practice for the employer to issue a warning letter for performance or a warning letter for absenteeism before proceeding with termination. These letters act as a formal notice to the employee and serve as supporting documents during the termination process.

Employers should ensure that proper documentation is maintained throughout the disciplinary process, making the final termination letter part of a fair and transparent workflow.