Does an Employer Have to Provide an Employee Termination Letter?

Do you need to provide an Employee Termination Letter when considering firing or laying off an employee? In most cases, an employer does not need to provide notice of termination; however, there are a few situations where such a letter is necessary. To determine whether or not an Employee Termination Letter is needed, you must consider the individual’s employment status; an employee can either be working ‘at-will,’ under an employment contract or as part of a union.

At-Will Employees

Federal law does not mandate that an employer provide an Employee Termination Letter when the employee is working ‘at-will.’ At-Will Employment means that the employee can be terminated for almost any reason and the reason does not need to be provided. The caveat is that the employee is also free to quit without notice. While firing an employee without notice and without reason is not good management, the law allows for such actions. On the contrary, an employer cannot fire an employee due to discriminatory reasons. If an employee suspects that she or he was let go due to discrimination, the employee may be entitled to compensation.

Employee Contract / Union Contract

Terminating an employee under contract must be done in accordance with the provisions of the contract, and written notice is required for termination. Typically, a contract will require a minimum of two-week’s notice and may include compensation succeeding the termination. To terminate an employment contract, start by filling out this Employment Termination Letter template.

Why Should You Always Provide an Employee Termination Letter?  

While not required for ‘at-will’ employees, you should still provide a Notice of Termination anytime that you let an employee go. The letter should include the reason for the decision to terminate the employee. By providing a letter, you not only mitigate the chance of a former employee retaliating, but you also set an attitude of dignity and respect: this will attract other highly-skilled workers.