Termination Letter template

Free termination letter template

A termination letter is a formal notice issued to end an employment relationship or a contractual agreement. Also known as a separation notice, a well-written termination letter outlines the reasons for termination and provides any necessary instructions regarding final payments, expectations, and detailing out next steps.

Docusign provides a simple termination letter that gives you a straightforward template that allows you to fill in, edit, or add details specific to the situation. Once the termination notice is complete, you can download, print, or send it for signatures via Docusign To get things started, sign into your Docusign account or click on the termination letter template below:

The goal of a termination letter is to communicate a difficult decision clearly, ensuring both parties understand the terms. And our editable template allows you to tailor the message carefully, and digital delivery through Docusign ensures it is securely documented and stored. To handle the termination process efficiently and with proper documentation, sign up for a free Docusign account (or log into an existing one)..

What is a termination letter?

A termination letter is a formal document used by an employer to notify an employee that their employment is being ended. It outlines key details such as the termination date, reason for termination (if applicable), and information on final pay, benefits, and any company property that must be returned. According to the Society for Human Resource Management (SHRM), termination letters help ensure clarity, reduce the risk of misunderstandings, and provide documentation for legal compliance.

When do you need a termination letter?

A termination letter is typically issued when an employment relationship ends, whether due to performance issues, layoffs, business restructuring, or mutual agreement. While not legally required in all states, the U.S. Department of Labor notes that providing written notice supports proper recordkeeping and can help protect both parties in case of disputes.

Employers should issue termination letters when:

• Ending employment due to performance or conduct issues

• Conducting layoffs or workforce reductions

• Ending a temporary or fixed-term contract

• Confirming mutual separation agreements

What is included in a termination letter?

A termination letter generally includes the following parts:

• Sender and recipient details: Full names, addresses, and contact information for both parties.

• Date: The date the letter is issued.

• Subject line: Clearly states the purpose (e.g., "Notice of Termination").

• Reference to the original agreement: Specifies the agreement being terminated and its effective date.

• Effective date of termination: Clearly indicates when the termination takes effect.

• Reason for termination: If required by law or the agreement, briefly state the reason for termination.

• Legal rights and obligations: Outlines any final payments, property returns, or other obligations under the agreement and law.

• Contact information: Provides details for a contact person in case of questions.

Additional (optional) parts

• Detailed explanation: More context for the termination, if appropriate.

• Severance or final compensation: Details of any severance pay or final settlement, if applicable.

• Appreciation or reference: A brief note of thanks or an offer of a reference (for employment terminations).

• Instructions for next steps: More specific instructions for returning property or completing final tasks.

• Confidentiality or non-disparagement clauses: If relevant to the agreement.