Employee management

It's All in the Wording - Termination Letters

October 27, 2016

An unfortunate, but unavoidable part of the employment lifecycle is termination. When a person is hired no one is expecting the situation will end in a termination; however, it is a reality that must sometimes be faced. Ending the employment relationship is one of the most stressful aspects of human resources. It can be fraught with legal minefields, not the least of which is the termination letter. Despite the best intentions to terminate an employee in accordance with legislation and in the fairest way possible, the termination letter can open an employer up to many legal issues if not done correctly.

Spotlight Case

Consider the case of Bohemier v. Storwal International Inc. While there were more factors at play than just the termination letter, this case demonstrates the importance of writing an appropriate termination letter. In the case, the employee had been employed by Storwal International Inc. for 35 years. When the business found itself in financial difficulty, they decided to terminate his employment. The employee arrived home from work and was presented his letter of dismissal from the driver of a taxi cab. Although there were several issues with the letter (including the fact that the amount of notice was insufficient), the court particularly highlighted that “the letter was cold and perfunctory. It expressed no gratitude for 35 years of devoted service. It offered no concrete proposal to assist the plaintiff in finding other employment. It did not specify the basis for payment in lieu of notice. It provided no comfort at all to the plaintiff.” On the basis of the letter (and other factors), the court decided that the ex-employee was “entitled to damages for mental suffering arising out of a failure to give adequate notice, aggravated by the manner in which the notice was communicated.”

A properly planned termination letter that accounts for all factors is a critical component of the termination process. Unfortunately, the termination letter is sometimes treated as an afterthought. A common trap for employers and HR professionals to fall into is where they try to ‘pretty up’ or ‘fancify’ a termination letter – sometimes resulting in the employee not understanding that they have been terminated. Don’t make it worse on yourself, the person being terminated, or your organization by drafting an unclear termination letter. As we saw in the case study, it is important to be as kind as possible without blurring the message.

Download our Termination Letter Action Plan which walks you through some of the finer details to consider.

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