Termination/Separation of Employment Policy Template

This Termination/Separation of Employment Policy template sets a good foundation for your company’s employment policies. It should be adapted to your company’s individual needs and circumstances.

A termination/separation of employment policy is also known as employee termination policy or termination of employment policy.

The Principle and Application

Whenever an employee ceases to be part of the company’s workforce, it is important that the separation process is clear and anchored in both company policy and the law to avoid any misunderstandings or subjective judgments.

The company is committed to handling cases of termination of employment within the law and with discretion, professionalism, and official documentation. This termination policy offers guidelines on the separation process.

The policy applies to all current and future employees of the company in regard to the cessation of employment.

 Policy Highlights and Components

Meaning of Termination

Termination of employment refers to discontinuation of an employee’s contract. This may be due to company discretion or the employee’s actions.

The termination can further be categorized as voluntary or involuntary.

Voluntary separation may include the following:

  • Resignation
  • Retirement
  • Failure to report to work without notice or lawful cause
  • Expiration of a fixed-term contract

Involuntary dismissal may include the following:

  • Discharge for cause
  • Discharge without cause

Discharge for cause is the immediate termination of a contract over an employee’s misconduct. “For cause” in this case refers to any prohibited actions that result in termination.

Other violations that lead to immediate dismissal are also considered “for cause”. Examples of grounds for such terminations include the following:

  • Breach of the employment contract
  • Fraud or embezzlement against the company
  • Discrimination or harassment at the workplace
  • Unlawful or immoral conduct on the job
  • Willful neglect of duty or responsibilities
  • Willful damage to company property or assets
  • Continuous disregard of company policy

This list is not exhaustive and discharge for cause remains at the company’s discretion.

However, any action that warrants such dismissal will always have a component of unacceptable behavior or action that is injurious to the company, fellow employees or society.

Discharge without cause occurs when the services of an employee are no longer needed but has no reference to the employee’s conduct.

Reasons for a discharge without cause could be:

  • Layoffs
  • Rearrangement of departments or sections
  • Redefining of a position

Where an employee is terminated without cause, the company shall give a notice period as stipulated in the employment contract and depending on the time of service, age of employee and position.

If the employee stops working before the date of termination, the company will provide compensation for the time remaining. This payment is known as “payment in lieu of notice”.

Compensation from the company for unused leave days and severance pay may also apply for a discharge without cause. But we shall always abide by the law and will not engage in the wrongful dismissal of employees.

The following are examples of wrongful dismissal:

  • An employee is terminated unfairly without cause
  •  An employee is terminated without cause but without due notice
  • An employee is forced into constructive dismissal

All employees with official powers to terminate subordinates must exercise this responsibility with great forbearance, and especially refrain from discharging employees without adequate reason or without giving notice.

Such cases may undermine the company’s integrity and may warrant disciplinary action. It is emphasized here that discharge based on discrimination or filed health and safety complaints is unacceptable as it is illegal.

Constructive dismissal refers to an employee being forced to resign due to the employer’s intentional or unintentional hostility. Our company is committed to maintaining a relationship of honesty and fairness with its employees and will therefore not tolerate constructive dismissal.


In case of resignation, an official resignation letter must be submitted by the employee to the supervisor. The letter must give notice consistent with the minimum notice requirement, to enable the company to make alternative arrangements. The letter must be copied and submitted to HR as per the company’s employee resignation policy.

For involuntary dismissal, the supervisor submits an employee termination document to the human resources department. Immediate suspension would be justified in the case of discharge for cause where necessary documentation has not been compiled. If need be, a meeting may be held between the employee,  the supervisor and HR to discuss the termination.

In case of discharge without cause, the employee will be given official termination notice specifying the notice period and severance pay when necessary.

A comprehensive record will be maintained by the company with all relevant documentation. Whenever necessary, a lawyer will be consulted prior to termination to endorse the termination procedure by confirming it is within the law.

Download this policy sample:

Google Doc – Letter
PDF Document – Letter (.pdf)
Microsoft Word – Letter (.docx)
OpenDocument Format – Letter (.odt)
Rich Text Format – Letter (.rtf)
Plain Text – Letter (.txt)
Google Doc – A4
PDF Document – A4 (.pdf)
Microsoft Word – A4 (.docx)
OpenDocument Format – A4 (.odt)
Rich Text Format – A4 (.rtf)
Plain Text – A4 (.txt)

Disclaimer: This information is meant to provide general guidelines and should be used as a reference. It may not take into account all relevant local, state or federal laws and is not a legal document. Neither the author nor World Manager will assume any legal liability that may arise from the use of this information.

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