Everything You Need to Know about Termination Letters

Having a difficult employee or customer can be every manager’s nightmare and dealing is enough to cause a major headache. While it is an inevitable part of your role as a manager, it is important to handle the problem with a clear mind and deeper patience, or else you will lose your sanity (well, not literally though) and take the necessary action to address the issue before the said employee goes out of control. When you are unable to provide a remedy to the problem, there is a huge possibility that the negative behavior or poor performance of the employee can affect the overall productivity of the operation, as well as cause disturbance in the workplace. That is why you need to send him warning letters to inform about the alleged issues associated with him. If he remains to misbehave or improve his performance, then may be it is the perfect time to terminate his employment contract with the company.

Types of Termination Letters

According to the Business Dictionary, there are two different natures of termination. The first one defines termination as “the final step in the progressive employee discipline process where his or her employment with the employer is permanently severed” while the second definition states “the cancellation by a customer, either in whole or in part, in any work or performance remaining to be done under a contract”. 

In the world of business, there are different types of termination letters that you can use depending on the nature of your purpose and the causes that are implemented to ensure that the contract termination is considered legal and appropriate. To ensure the validity of the termination, it is important to gather supporting documents to prove that you have sufficient grounds to discontinue the contract.

In this article, we have provided the different types of termination letters that are used in different fields, along with its unique reasons and purpose for writing.

Employee Termination

One of the most common and valid reasons for terminating an employment contract is the incapacity of the employee to function effectively in his position. Obviously, one of the conditions stated in most job contracts is that employees have to focus on his job and perform his duties and responsibilities as diligently and efficiently as he or she could. If you think that whether an employee is deliberately slacking at work and demonstrates poor performance or not, it is important to based on valid and justifiable reasons and make sure that it consistently harmonize with your supporting documents. Here are some common reasons why an employee gets terminated or fired:

  • Attendance Issues (tardiness and/or absenteeism)
  • Breaking the company policy
  • Insubordination
  • Unacceptable behavior, such as theft, dishonesty, and sexual harassment
  • Engaging in physical violence or making a threat to another member of the organization
  • Disclosing the trade secrets of the company to an outside party

Check out some of the sample employment termination letters that are provided below:

Editable Job Termination Letter to Employer Word Download



Notice of Job Termination Letter Template Word Download



Sample Editable Employee Termination Letter Job Abandonment



Sample Termination Agreement Between Company & Employee Format



Employee Agreement Termination Letter



Tenancy Termination

The tenancy agreement may be terminated when it is expiring or about to expire. However, it can also be terminated by the landlord for the following reasons:

  • When a tenant fails to adhere to follow to the terms and conditions stipulated in the tenancy agreement
  • When the tenant does not pay the monthly rent for a period of time
  • Because of  new ordinances or zoning code set by the local government
  • Certain situations that make the area unsuitable to live in

A notice of tenancy termination is usually given by the landlord to the tenant to inform them that the landlord wishes not to continue the contract and to give them time to vacate and look for another place. To protect yourself from a potential lawsuit, your tenancy termination letter should include the following:

  • The date the lease is set to be terminated
  • Reasons why you are terminating the tenancy or lease agreement. Make sure that you have the necessary documents to support your reasons for lease termination
  • Provide a remedy or solution that can help prevent the termination

If you are looking for a professional lease termination letter, make sure to check out the following samples that are found below:

Lease Termination Letter Template



Home Rental Termination Letter Template PDF Format



Lease Agreement Termination Template



Equipment Rental Termination Letter Sample PDF Format



Editable 30 Day Rental Termination Letter Template Sample



Sample Notification Termination Letter to Landlords Download



Service Contract Termination

Sometimes, in the business world, some things just do not work out. This is often true in service agreements or contracts. There are various reasons when one or both parties decide to mutually end the service contract the legally binds them together. When you find yourself dissatisfied with the services that are provided by the other party, then the best thing that you can do is to send a service contract termination letter that you no longer wish to continue to use their services. Some of the common reasons for service contract termination are:

  • The other party lacks the capacity to meet your demands
  • Breach of contract due to misrepresentation, mistakes, or fraud
  • Delayed payments
  • The supplier provides you with defective and low-quality products
  • Late or delayed shipment and delivery
  • Costly charges

If you are looking for service contract termination letter, make sure to check out the following sample templates below:

Free Termination of Services Contract Letter Template Sample



Editable Termination of Services Letter to Client in MS Word



Free Download Termination of Services Letter to Customer Sample



Letter of Vendor Termination of Contract Template



Editable Security Service Termination Letter Template Word Doc



Business Partnership Termination

While being in a business partnership can bring a lot of benefits in a company, there are certain times when you have to terminate the partnership agreement or mutually terminate it. And since there are business partnerships that do not last a lifetime, it is important to protect yourself with a written business partner agreement that determines the type of action that will terminate the agreement and what happens after the termination. Here are some common reasons to keep in mind that can terminate or dissolve the business:

  • If one partner deliberately break the terms and conditions stated in the agreement
  • When the other party engages in illegal business practice that can ruin the reputation of the business
  • When your partner suffers from mental or physical illness
  • If your partner is no longer able to fulfill his business duties

If you want to download a professionally written partnership termination letter, then make sure to consider the following sample templates that are provided below.

Sample Partner Termination Letter Template Word Format



Free Sample Partnership Termination Letter Template PDF Format



Do’s and Don’ts of Termination

Having to terminate one’s contract can be considered to be one of the most awkward and difficult decisions that most employers or entrepreneurs can make. Whether you are terminating an employee or service provider, there are some key elements that need to be put into careful consideration before making a final decision on letting them go. No matter what your reasons for contract termination, it is important to keep in mind that even if you are firing someone, you should treat the person with dignity. Without further adieu, here are the do’s and don’ts of termination.

Do’s to Follow:

  • Take some time to carefully consider the reasons for terminating someone’s contract,
  • Make sure to review and evaluate the contract or agreement whether the grounds for termination are sufficient and valid.
  • If you are unsure, seek a legal advice from a qualified lawyer.
  • In case you will be dismissing an employee, prepare a termination letter that includes the information the basic information for the dismissal, such as the reasons for the termination and the final payment for vacation pay, severance pay, and standard monthly wage.
  • Make sure to be discreet when having a meeting and be respectful towards the employee. Although termination can be a traumatic experience, it is your duty as a manager or employer to make sure to preserve the dignity of the dismissed employee after the meeting.
  • Have the dismissed employee sign a “Release of Claims” to protect the company from any further lawsuit that will be filed by the employee.
  • Consider providing the employee with a reference letter to help lessen the burden of finding another job.

Don’ts to Avoid

  • It is important to not get too personal when firing or terminating someone else’s contract and not let your emotions get the best of you. Make sure that your reasons for terminating a person’s contract should be business-related or performance issues. Do not base your reasons on personal, emotional or subjective opinion against the person.
  • Do not terminate a contract without discussing it with the person in a meeting. Holding a one-on-one meeting gives the other party a chance to defend himself from any allegations that are made against him.
  • Do not terminate someone with extending a notice. Blinding an employee without giving him a warning can make him do things that can be disastrous to your organization. In this age of social media, the dismissed employee can make any negative comments or publications against you and your company, which can potentially affect not only your brand but instill in other people’s mind that you do not have the courtesy to discuss the issue with your employees.
  • When you want to meet and discuss the termination with the employee or partner, be sure to make it private and not in a public place where other people can eavesdrop your conversation.
  • Avoid making the person believe that the termination is not yet final. As a professional, you should know that giving the employee or client false hope is unacceptable.

Tips on Creating a Termination Letter

Writing a termination letter can be an extremely daunting and challenging task, especially if this is your first time because oftentimes, it contains sensitive information which is only limited to you and the terminated party. Although it can be an unpleasant experience to fire someone, writing a termination letter is an absolute requirement. However, it is important to keep in mind that make sure that the content of the letter should not cause a major damage to the dignity and confidence of the other party. In this section, we will provide you with some helpful tips on how to write a termination letter that would not make you sound like a heartless tormentor.

  • It is important to understand that a letter of termination is one of the many forms of a business letter. So when writing a termination letter to an employee, business partner, or clients, make sure to address them professionally and avoid using greetings, such as “Hello,” “Hi,” and “How are you?” Make sure to avoid using or including any unnecessary greetings or information when opening the letter.
  • When writing a job termination letter, make sure to open the first paragraph by stating how long the employee has been working in the company, as well as the duties and responsibilities associated with his or her current position. This strategy is used to soften the impact and you can further offer a statement how much the company has enjoyed his or her presence during the employee’s time in the organization.
  • In the second paragraph, make sure to inform the employee that you are letting him go and not continuing his contract. Be sensitive in offering your sentiments by writing something like “We regret to let you go due to” and then provide the valid reasons for his or her termination. To provide the employee with a clearer picture, you can provide a list of the activities that have caused the termination. Make sure not to leave anything out to protect the company from a potential lawsuit that may arise in the future.
  • The next paragraph should focus on the future of the employee. You can wish him well in his future endeavors. You can also provide the standard protocol when he wants to request for a job reference letter. You can also help him by sharing some information about his future employment prospects.
  • Do not forget to end the letter with “warm regards” or “best wishes” to help prevent the letter from sounding harsh and soften the tone.

Ways to Send a Letter of Termination

There are various ways in which you can send the letter to the concerned person. Found below are some of the most formal and common methods that you can do when sending a termination letter. Read on to know the ways:


Mailing a letter at the post office is considered to be one of the most common and traditional ways of sending a termination letter. Mailing is the best option when the recipient does not have an Internet connection or access to email. However, it would take a few day until the letter is received by the recipient.


Since we are living in the golden age of digital technology, you do not have to go to a post office and mail the termination letter. Emailing your termination letter ensures you that the letter will reach to the recipient quickly and conveniently. All you need to do is to get the correct email address of the recipient and send the letter with only a few clicks.


While a mail and an email are the most common way to send a termination letter, handing it personally is considered to be the most formal of giving the termination letter to the person. This is because handing in the letter personally to the person gives a feeling of urgency rather than having them to wait for a couple of days or informing them through an email. What is great with being able to personally hand in the letter is that you provide the person a chance to ask questions or make inquiries all at once.

Other Sample Termination Letter Templates that You Can Download and Use as Reference

Sample Termination Letter Template



Simple Termination Letter Mail



Free Web Hosting Service Termination Letter Template Sample in PDF



Free Termination Letter Sample



Example of Work Termination Letter



Printable Staff Termination Letter



Final Thoughts

Although nobody wants to receive a termination letter, considering the methods that are stated above can help and guide you on how to effectively write an ideal termination letter that preserves the dignity of the receiving end. Although there are various formats used in termination letters, the contents are basically just the same. All you need to remember is to be tact, polite and professional all at the same time. With all the information that is discussed in this article, you can write a termination letter that can firmly promote and defend your decision, no matter who your audience is.

So what are you waiting for? Make sure to choose from our templates and download the ones which you think suits your personal purpose!

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