Sample Termination of Employment Letter (End of Contract)

A termination of employment letter officially informs an employee that their employment is ending. It provides key details like:

• Last day of work

• Reason for termination (e.g., contract expiration)

• Final pay and benefits information

• Instructions for returning company property

To ensure a smooth process, the termination of employment letter should:

Step	Details
Verify Accuracy	Double-check employee details, termination reason, pay/benefits, and property list
Get Approvals	Obtain approval from HR, legal, the employee's manager, and stakeholders
Delivery Method	Decide how to professionally deliver the letter (in person, mail, or email if allowed)
Document & Record	Keep records of the letter, supporting documents, and communication

By following these steps, the termination of employment letter serves as a clear and compliant record for both the employer and employee.

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Get the Details Right

Before drafting the termination of employment letter, gather all the necessary information to ensure accuracy and compliance.

Review the Employment Contract

Go through the employment contract and look for specific terms, conditions, and clauses related to termination. This includes:

• The termination clause

• Notice period requirements

• Obligations of the employer and employee

Determine the Reason for Termination

Clearly identify the cause for termination, such as:

• End of contract

• Misconduct

• Performance issues

Be specific and accurate when stating the reason to prevent disputes or misunderstandings.

Establish the Last Working Day

Confirm the employee's final day of work. This date is crucial for calculating:

• Final pay

• Unused leave

• Other entitlements

Collect Final Pay and Benefits Information

Gather details on:

Item	Details
Final Paycheck	Amount, pay period, deductions
Unpaid Leave	Vacation, sick days, etc.
Severance	If applicable, based on company policy
Other Benefits	Health insurance, retirement plans, etc.

List Company Property to Return

Make a list of all company property the employee needs to return, such as:

• Laptops

• Phones

• ID cards

• Keys

• Other company materials

Having all the necessary information upfront will help you create a comprehensive and accurate termination of employment letter that protects the interests of both the employer and employee.

Letter Structure and Format

Use a formal business letter format with clear headings and greetings. Break the letter into sections for easy reading.

Purpose and Termination Date

State the purpose (ending employment) and the effective date. This sets the tone and ensures the employee understands the letter's intent.

Termination Reason

Explain the reason for termination clearly and objectively. For contract endings, reference the specific contract terms and expiration date. For other reasons, outline the circumstances and any prior disciplinary actions factually to avoid disputes.

Final Pay and Benefits

Explain how the final paycheck will be handled:

Detail	Information
Payment Date	When the final pay will be issued
Payment Method	How the final pay will be provided (e.g., direct deposit, check)
Unused Leave	Any remaining vacation, sick days, etc. to be paid out
Severance	If applicable, based on company policy
Benefits	Information on continuing health insurance (COBRA, if eligible)

Ensure the employee understands their entitlements and any necessary next steps.

Return of Company Property

List any company property that needs to be returned:

• Laptops

• Phones

• ID cards

• Keys

• Other materials

Specify the deadline and procedure for returning these items to prevent disputes.

Closing Remarks

Provide contact information for any questions or concerns. Maintain a professional and respectful tone throughout to encourage a smooth transition.

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Additional Steps

Check for Accuracy and Compliance

Review the termination letter carefully to ensure all details are correct and comply with relevant laws and company policies. Verify:

• Employee's name, job title, and employment dates

• Reason for termination is factual and objective

• Final pay and benefits information is accurate

• List of company property to be returned is complete

Get Necessary Approvals

Obtain approval from the required parties before finalizing the letter:

• Human Resources

• Legal department

• Employee's manager or supervisor

• Other stakeholders involved in the termination process

Choose Delivery Method

Decide how to deliver the letter professionally and respectfully:

Delivery Method	When to Use
In Person	Employee is on-site
Certified Mail	Employee is off-site or remote
Email	Allowed by company policy

Consider the employee's location and the reason for termination.

Document and Record

Keep detailed records of all termination-related documents and communications:

• Termination letter

• Supporting documents

• Meeting notes or conversation records

Store these records securely and confidentially, accessible only to authorized personnel.

Following these steps ensures the termination of employment letter is accurate, compliant, and properly handled. This helps minimize potential disputes and maintain a positive relationship with the employee.

Summary

Ending a Contract Employee's Job

A termination letter formally ends a contract employee's job. It states:

• The last day of work

• The reason for ending the job

• Details on final pay and benefits

• Instructions for returning company property

Key Points

• Effective Date: Clearly state the employee's last day.

• Reason for Termination: Explain why the job is ending, such as the contract expiring.

• Final Pay and Benefits:

  • When the final paycheck will be issued

  • How it will be paid (e.g., direct deposit, check)

  • Any unused vacation or sick days to be paid out

  • Severance pay, if applicable

  • Information on continuing health insurance (COBRA eligibility)

• Return Company Property: List items to be returned, such as laptops, phones, ID cards, keys, and materials. Specify the deadline and procedure.

• Contact Information: Provide details for any questions or concerns.

Ensuring a Smooth Process

• Review for Accuracy: Verify employee details, termination reason, pay/benefits information, and property list.

• Get Approvals: Obtain approval from HR, legal, the employee's manager, and other stakeholders.

• Delivery Method: Decide how to deliver the letter professionally (in person, certified mail, or email if allowed).

• Document and Record: Keep detailed records of the termination letter, supporting documents, and communication.

Following these steps helps ensure a respectful and compliant termination process. Seek additional resources or support if needed.

FAQs

How do I write a letter to end an employment contract?

To write a letter ending an employment contract, follow these steps:

1. State the last work day

Clearly note the employee's final day of work, ensuring it follows the contract terms.

2. Explain why the contract is ending

Provide a valid reason for termination by citing the relevant contract section.

3. Outline the next steps

Describe the procedures to finalize the termination, including any required paperwork or meetings.

4. List items to return

Specify any company property, like equipment, documents, or keys, that must be returned by a set deadline.

5. Include final pay and transition details

Provide information on the final paycheck, benefits, and any available resources or support during the transition.

Step	Details
1. Last Work Day	Clearly state the employee's final day, following contract terms
2. Reason for Ending	Cite the relevant contract section for a valid termination reason
3. Next Steps	Outline procedures to finalize termination (paperwork, meetings, etc.)
4. Return Company Property	List items like equipment, documents, keys to return by a deadline
5. Final Pay and Transition	Details on final paycheck, benefits, resources for the transition

Related posts

• How to Write a Termination Letter
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• Sample Termination of Employment Letter (For Cause)
• How to Address a Contractor Directly in a Termination Letter