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Five things to keep in mind while writing a termination letter

Five things to keep in mind while writing a termination letter

Posted in Advice & Tips on by Graham Evans

Having to terminate an employee is unfortunately quite stressful, but sometimes there is no way to avoid it. All manner of circumstances can give rise to the need for termination – including redundancy, misconduct and more – and these circumstances can sometimes have an effect on the way in which employees have to be terminated. As well as this, there are a number of legal obligations that you have to meet as an employer when terminating an employee. These legal obligations include, in some instances, a number of steps aimed at either notifying the employee of their impending termination, or providing them with the opportunity to rectify any of their previous workplace breaches.

A failure on your part – as an employer – to meet some of these admittedly complicated legal requirements can leave you and your business open to a fair work complaint. The Fair Work Commission manages these complaints and the ombudsman has the authority to hold you liable for any failure to meet your obligations in the termination of an employee. Because of the seriousness of the entire process, it is paramount that you take all the necessary steps in correctly terminating employees and one of the most important components of the termination process is the termination letter. There are many things to consider when writing a termination letter, although there are five things in particular that you should keep in mind while writing a termination letter.

Have you highlighted the expected standards of performance and behaviour?

Employment legislation – in most cases – requires that employers provide their employees with considerable notice prior to terminating them. This means that before writing your letter of termination, you should ensure that your employee has been informed of the standard to which he or she is held. One of the first steps of this is performance management. Performance management involves an employer, or human resources representative, talking directly with a problematic or under performing employee about an issue that may have arisen regarding their conduct or performance. This step is appropriate for instances in which an employee is consistently failing to meet performance standards, conduct standards or other workplace standards. The first stage of performance managing an employee is to directly and clearly outline your company’s standards, before informing them of their shortcomings. Performance management is aimed at providing employees with the opportunity to improve their behaviour or performance to meet company standards. It is important to note, however, that misconduct is a multifaceted and inherently more complex issue – particularly where serious misconduct is involved – and it is often advisable for employers to seek legal counsel when dismissing an employee for serious misconduct.

Have you identified and addressed the issue?

Before you can continue through the process of terminating an employee, workplace relations legislation stipulates that you must take the steps necessary to directly identify and address any issues you might have with an employee, before you can work towards terminating them. Essentially, the law demands that employers make no assumptions about any of the circumstances surrounding a workplace situation; employers must be clear with employees and establish a factual account of any conduct or performance issued in the workplace. A good approach at this stage is to highlight precisely what an employee did, or is doing, that is not consistent with your company and discuss the effect their actions have had on the company as a whole. All communication of this nature should be recorded in some way, to provide you with a strong foundation upon which to take further action in the future. If you have already engaged with this step to no effect, you can make reference to these meetings in your letter of termination.

Have you issued written warnings?

Written warnings are, in a sense, the final chance for a problematic employee to raise their standard of conduct and productivity and retain their position. Written warnings are required under workplace relations legislation and they are essentially aimed at providing a clear and direct summary of the issue, however this is not all they must include. A warning letter must also set out some guidelines or strategies to provide the employee with an approach by which to better his or her conduct. Following this, your warning letter should outline the consequences of failing to meet company standards and usually, the consequence will be termination. Some employers even include a deadline, by which they demand that the employee address the issues in question or be terminated. Before you can write your letter of termination, you must have issued the employee in question with at least one written warning to satisfy the requirements of Australia’s employment legislation.

Have you included the necessary information while writing a termination letter?

If you have engaged with each of the steps listed above and there has been no change in the productivity, conduct or behaviour of your employee, then you ought to begin a letter of termination. According to fair work legislation, a letter of termination can be presented to an employee if their breach of workplace standards cannot be resolved, despite the provision of a reasonable timeframe and performance management support. If you have completed the previous steps then it is likely that you satisfy these requirements, therefore you can take the final step in terminating your employee. Your termination letter should highlight the reasons for which you are terminating the employee, state the period of notice – or if they will receive reimbursement in lieu of notice – inform them of their last day at work and notify them that their final payment might have implications on their eligibility for centreline payments.

Have you scheduled a meeting to provide your employee with the letter?

Finally, you should schedule a meeting to provide the employee in question with a copy of their termination letter. It is imperative that your employee understands the contents of the letter and is familiar with the details you have provided therein. It is usually helpful to offer the employee an opportunity to seek clarification on any points of confusion. As an employer, it is important that you fulfil your obligation to your employees, as any failure to do so will leave you liable to a fair work claim, which can potentially result in monetary sanction.

For more tips and tricks around writing a termination letter, get in touch with Fairly today.