Letters

Termination Letter Format: Free Template (Word & PDF)

A termination letter formally ends an employment relationship — it states the effective date, references the basis and process followed, and sets out handover and final settlement expectations. This is the most legally sensitive document on this page; download the free Word and PDF version below, but read the caution section first.

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What a Termination Letter Must Include

  • Employee details: name, ID, department, designation, and the date issued
  • Reference to the relevant prior communication, policy, or process followed
  • The basis for termination, stated factually
  • The effective date of termination
  • How final settlement will be handled
  • Handover expectations: company property, documents, access credentials, and a deadline
  • Who to contact to complete exit formalities
  • Signature of the authorized signatory

Before You Issue a Termination Letter

Termination carries real legal risk if the process isn't followed correctly. Before using this template:

  • Confirm the termination follows your company's documented process (prior warnings where applicable, a fair hearing, notice period or pay in lieu as required)
  • Check the applicable notice period under the employee's appointment letter and applicable state law
  • Calculate full and final settlement correctly, including any accrued leave encashment
  • Have the letter reviewed by legal counsel or an HR professional familiar with your state's labour law before sending it, especially for performance or conduct-based terminations

This template gives you the structure. It does not replace following due process.

How to Use This Template

  1. Reference the specific prior process (performance reviews, warnings, show-cause notice) that led to this decision, where applicable
  2. State the effective date clearly, and whether notice period is being served or paid in lieu
  3. Set a specific handover deadline and a named contact for exit formalities
  4. Issue the relieving letter separately once handover and settlement are actually complete — don't combine the two documents

Disclaimer: this is a general template, not legal advice. Review it against your company policy and applicable law — ideally with legal counsel — before use, especially since this document can affect someone's employment.

Frequently asked questions

Employee details, reference to the process followed, the basis for termination, the effective date, final settlement details, handover expectations with a deadline, and a contact for exit formalities.

A termination letter ends the employment relationship and states the basis and effective date. A relieving letter is issued after handover and settlement are complete, confirming the employee has been formally relieved. See our relieving letter template for that stage.

Generally yes, as specified in the employee's appointment letter and applicable state Shops and Establishments Act, unless it's a termination for proven misconduct following due process. Check the specific notice period terms and consider paying in lieu where the company chooses not to serve notice.

Strongly recommended, especially for performance or conduct-based terminations. Termination carries meaningfully higher legal risk than most other HR letters, and a template alone doesn't account for your specific situation or jurisdiction.

It should be calculated and processed according to company policy and applicable law, typically including any pending salary, accrued leave encashment, and other dues, minus any recoverable amounts. State the settlement timeline in the letter.

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