This General Letter of Termination of Employment is designed for use by an employer that wishes to terminate an underperforming employee's employment. It is intended to be a final letter to the employee, formally notifying them that the employment is being terminated. This is not designed for a redundancy situation. If an employee is being terminated due to redundancy, use our Letter of Termination of Employment (Redundancy).
This is part of our collection of letters for underperforming employees. These are designed to be used in the following sequence:
2. If employer wants to provide a second or third warning to the employee - use Employee General Warning Letter again.
4. Letter of Termination of Employment (General).
Further information about what an employer must do before terminating an employee can be obtained from the website of the Fair Work Ombudsman. Small businesses may also need to consult the Small Business Fair Dismissal Code. It is important that the employer understands its obligations in relation to this matter. If an employer breaches some of these obligations (for example, by terminating an employee prematurely), then the employer could face penalties for unfair dismissal, and may be unable to remove the employee.
Many employers choose to use the following process (even if not required by law). However, if the law requires more to be done, then it may be necessary for the employer to do more than this:
1. Have a first meeting with the employee, to discuss the performance issues, provide a strategy for improvement (such as deadlines for improvement, and quantifiable goals for the employee). Provide a letter of warning to the employee.
2. If performance has not improved by the due date, have a second meeting with the employee to advise that performance has still not improved. Provide a second letter of warning to the employee.
3. If performance still does not improve, have a third meeting with the employee. Advise the employee that if their performance does not improve by a particular date, their employment may be terminated. Provide a third warning letter to the employee, confirming these details.
4. If performance still does not improve, have a fourth meeting with the employee to terminate employment, and provide a copy of this letter.
How to use this document
The employer may first need to check for any particular procedures that the employer is required to follow, and any minimum notice periods. Minimum standards for employment are set in the National Employment Standards. However, if there is an applicable industrial instrument (such as an award or a registered agreement), then this may set additional requirements. In addition, a contract of employment or a workplace policy might also set additional requirements. In any case, the employer will need to comply with whatever requirements are most favourable to the employee. The National Employment Standards are only the minimum standards.
Once the employer is satisfied that it has followed the appropriate procedures and is entitled to terminate the employee's employment, the employer may prepare this letter by including all of the relevant information when prompted.
The employer may then organise a meeting with the employee, and at that meeting, provide a copy of this letter to the employee. The employer should also keep a copy for their own records.
In any case, the employer will need to pay attention to any minimum notice periods. If this letter is being provided by prepaid post, for example, then the employer will need to make sure that it is received by the employee early enough that the employee actually receives the minimum amount of notice.
In most cases, the employer will be required to keep paying the employee until the end of the notice period (or provide payment in lieu of that notice).
The Fair Work Act 2009 (Cth) and the National Employment Standards (NES) apply to most employment situations in Australia.
However, in addition, many employment situations are also governed by modern awards or enterprise agreements. If such an award or agreement applies, then that will set out some additional minimum standards with which the employer must comply.
In addition, general principles of contract law, as provided by the common law, will apply to any employment contract.
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