There are a lot of reasons why employers keep their employees and why they need to let them go. The same thing applies to employees. Employees also have a lot of reasons why they want to stay in a company or why they want to leave the company. This is where termination letters become useful.
Termination letters serve a lot of different purposes, aside from kicking out employees or leaving one’s employment. Termination letters can also be used to end a contract or end a lease. We have here sample termination letters for different purposes that you can view, edit, and download. You may use them as reference as you make your own termination letter; better yet, you can use them as your own. All the samples you see in this article are free for download. Hurry, get them now!
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What Is a Termination Letter?
A termination letter serves as a notice that an employer gives to their employees to end their employment with them because of not being able to meet company standards or simply because it is the end of their contract with them. Employees can also terminate their employment with their employers through a termination letter, more popularly known as a resignation letter. Regardless of who or how or why a termination letter is provided, its main purpose stays the same, and that is to end something such as an employment or cut ties from another party just like in a contract. Other examples where termination letters can be used are lease or rental agreement, loans sales, and many more.
What Are the Parts of a Termination Letter?
To be able to write a complete and useful termination letter, you will need to know its parts and how they function in the letter. Below we have listed the parts of termination letter and a brief description of what they are.
The heading is the very first thing that you put on top of the letter, which serves as the title of the letter. Letter headings are usually written in bold letters and using a font type that is different from the rest of the letter. Although a heading is part of a termination letter, not all termination letters have it. This is because some people would prefer not to put a label on their letters.
The date written in a termination letter should be the date when the letter will be submitted to the appropriate department or given to the employee being terminated and not the date when the termination will take effect.
The address part contains the correct name and designation of the person where the letter should be addressed to. The address used is usually the company address or the specific floor in a company where that person’s office is located.
“To Whom It May Concern” is one of the common greetings being used in any letter together with “Dear Sir/Ma’am.” These salutations are used in letters if the writer doesn’t know or is not sure on to whom they should address their letters to. Personalized greetings such as “Dear Mrs. Jones” can also be used if the writer is close or familiar with the person to whom the letter should be addressed to.
As with all other letters, the body of the letter makes up the largest part. This is where the statement of termination is written, including the effective date of the termination and the reason for the termination. The body may consist of two or more paragraphs depending on the writer. The specific reason why termination is provided or the specific instances that lead to the termination is provided in detail in the body of the letter. This is where you usually get to understand the whole termination thing.
The closing greeting is the part where the writer officially closes the letter. The closing greetings used vary depending on the writer. The commonly used ones are “Sincerely yours,” “Yours truly,” and “Respectfully yours.”
Name and Signature
The name and signature being written in the termination letter should be the name and signature of the writer. A space where the receiver of the letter writes their name, signature, and the date when they have received the letter is provided right beside the writer’s name and signature, or right below it.
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What Is an Employment Termination Letter?
This letter is usually used in a company or a workplace to terminate or completely cut the employer’s or company’s ties with their employees. There are various reasons why an employee gets terminated from work. The most common reasons are due to nonperformance, failure to meet company standards, violations of the company’s rules and regulations, misconduct or grave misconduct, or the end of one’s contract. However, there are also termination letters that are provided without cause or reason and that largely depends on the employer or company.
What Are the Two Main Types of Termination?
The two main types of termination are involuntary termination or voluntary termination. Each of these types of termination will be discussed below.
Involuntary termination occurs when a certain authority terminates ties with another entity to end whatever relationship they have. In an involuntary termination, whoever has a higher ranking can do the termination or provide the termination letter. Examples of involuntary termination are as follows:
- An employer terminating the employment of one of their employees because of a particular reason
- A contract terminated by the court or the government
- A contract terminated because of the violations to its terms and conditions
- An employment contract that is coming to its end
When you say voluntary, it means you are doing it willingly or you are doing it on your own accord. This type of termination occurs when all of the parties involved agree to the termination. Some examples are as follows:
- An employee may voluntarily terminate their employment from their current employer by providing a resignation letter.
- A landlord and tenant may agree to terminate their lease contract or rental contract based on what they have agreed on.
- A borrower may voluntarily request that their loan be terminated with the promise that they will pay the full loan amount plus the interest in full.
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What Is a Lease Termination Letter?
When a property or asset is leased by a landlord to a tenant, a lease agreement contract is formed and both parties must agree and oblige to the terms and conditions stated in the contract. The tenant or landlord may terminate the lease agreement by writing a termination letter or a lease termination letter as a notice that they want the lease to be terminated. This is of course done based on the provided terms and conditions.
How Should a Termination Letter Be Written?
Just by hearing the word termination, people automatically think of dreadful and harsh words or bad reasons why someone or something got terminated. This could be due to the scenes we see in movies about employers shouting and firing their employees. This is not always the case with termination letters though. Below are some of the ways on how a termination letter should be written.
- It should be in a formal letter format. It’s bad enough to receive a termination letter, so the key to making it work just a little bit is to make it formal. A termination letter is just like saying you are fired in a formal manner. Well, it’s not always written in a caring way, but at least you let the recipient of the letter know that things are decided and done professionally.
- It should be polite and unbiased. You don’t want to write insulting words in your termination letter. Being rude and unbiased are things that must be avoided when writing termination letters or just about any other types of letters. Being polite and unbiased shows an individual’s or a company’s sense of professionalism.
- It should serve as a notice. Termination letters should always provide the exact date when the termination will take effect. In other words, it should notify the person being terminated about what is going to happen to them after receiving the letter.
- It should be reasonable. Every termination letter should include a rational or valid reason why an employee or a contract will be terminated. This doesn’t always have to be reasonable based on what we believe as reasonable or not. What may be reasonable for a company based on their company policies may not always be reasonable for us. Still, there are companies that do not provide a reason for termination.
- It should be clear and concise. The goal of writing any letter is to make sure that the reader understands what is being written in it regardless if the letter is a resignation letter, a thank-you letter, or a business letter. Writing clearly and concisely is one way that you can get your reader to understand what you really want to tell them.
- It should be legal or based on specific agreed upon terms and conditions. In movies or dramas, the antagonist always finds a way so that the protagonist would be blamed for doing something illegal and then get terminated for that. This is because a person or a contract cannot be terminated just because they want to have it terminated. The termination should always be based on the legalities that have been agreed upon by all of the parties involved.
- It should be fair. Ideally, termination letters should be fair. But because not all people and bosses are alike, there will really be instances when being fair is overshadowed by a lot of biases. Just keep in mind that nothing or nobody wants to be terminated no matter what the reason is.
The Advantages and Disadvantages of Termination Letters
In order to provide you with more useful information about termination letters. We have gathered here some of the advantages and disadvantages of termination letters. Knowing these information will further help you understand why such a primitive tool as a termination letter is still being used today.
- Provides prior notice. As mentioned above, a termination letter serves as a notice and should provide the date when the termination would take effect. If employees need to provide notice to their employers before resigning through a resignation letter, the same thing also applies to termination letters.
- Provides a clear reason why termination is done. And because a termination letter explains all that there is to know about why this employee is terminated or why this contract needs to be terminated, the recipient of the letter will understand the circumstances. The details of the termination should also be explained further by a representative.
- May demotivate employees. Receiving a termination letter and knowing that your employment or contract will be terminated never brings good news to anyone, except in weird situations. Having a demotivated employee is one of the disadvantages of providing a termination letter. This causes an employee to stop being productive or not show up at work even before the termination’s effective date.
- Provides a stressful situation. You just received a letter stating that you are terminated for this and that reason on this date. How would you feel? Sad and stressed out. Who wouldn’t? Finding a job is stressful. Failing a job interview is even more stressful. Getting terminated from your job is even worse.
- Allows the employee to exit a company with dignity. Terminating someone or something should be done as discreetly as possible. This ensures that the employee being terminated will not be shamed or tormented about the fact that everybody knows about their termination. Also, shaming is never a good thing and if an employer does that to their employees, they may slowly lose their trust and in the long run leave them for good.
- Serves as proof. Even with the technological advancement that we are enjoying right now, termination letters that are printed on paper are still being used. These hard copies are beneficial to the parties involved in the termination. For employers, it serves as proof that they have notified their employee about the termination and explained to them in detail the grounds for termination as well as encouraged them to reach out for any issues they don’t understand. Employees can also use the termination letter as proof that something is wrong with the said termination, which is evident in the letter.
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