5 Mistakes Employers Make with Dismissal or Termination Letters
Due to the difficult nature of the announcement, the termination letter is not usually an easy one to write. But besides being difficult to phrase, part of the stress of writing a termination letter is the potential to get it wrong, creating extra problems which can end up being very costly for a business. Termination letters often contain too much information, or not the right information, all of which can leave the door open for the dismissed employee to take action.
When it comes to any dismissal, a fair process is just as important as the reasons for the dismissal itself, and following the right process, including having a well-documented paper trail, is critical to protecting your business. A correctly worded termination letter is an important aspect of conducting terminations fairly™, yet so many managers make these 5 mistakes below.
1. Using a dismissal letter as a way of venting anger at the employee. Many employers write the letter when feeling angry, which may cloud their judgement. Irrelevant facts and accusatory statements, which may not be 100 per cent accurate when assessed later in the light of a more measured assessment of the facts can undermine dismissal letters. A letter like this can even provoke the employee to take legal action which they may not have considered if they had been given a more moderate and respectful termination letter. Always write the termination letter from a rational and considered head space, not in the heat of the moment.
2. Go into too much detail. The termination letter is one of the final steps of the discipline process and is supported by other documentation, warning letters and counselling meetings. Getting caught up in every allegation and trying to provide justification of the termination often gives more room for your employee as well as any union representatives, , or lawyers to find any flaw in the details. A termination letter should provide a concise summary of the reasons for the termination, based on what had been previously discussed in warnings meetings and letters, and the termination meeting.
3. Being unclear, apologetic or imprecise about the termination. This only creates doubt in the mind of the employee. Remember you have only made a decision to terminate after careful consideration of all the facts. Having gone through this undoubtedly difficult process, you now do not want to undermine your work by giving the employee some small glimmer of hope of continued employment. If the employee is uncertain if they have been dismissed, so too may the Fair Work Commission. Just like a letter shouldn’t be written too harshly, a letter should also not be ‘too nice.’ Instead of referring to it as a retrenchment, notice to leave or any other language that could imply doubt, call the termination what it is (a termination) and avoid ambiguous terminology.
4. Not stating any reasons for the termination or dismissal. While point 2 dealt with providing too much detail, it’s not sufficient to simply say the termination is due to misconduct or poor performance. At a minimum, you should advise the type of misconduct or poor performance involved, how this behaviour breaches company policies, standards or external legislation or processes, and a summary of any remedial action taken including previous dates of warning letters.
5. Neglecting to confirm the actual termination date. Strict time limits based on the termination date apply when seeking to appeal a termination to the Fair Work Commission, Federal Court or Federal Circuit Courts. Failing to specify the termination date provides an open-ended opportunity for action to be taken against the business.
The pitfalls of poorly worded termination letters with the wrong content can be costly, time consuming and damaging to a business. Ideally terminations won’t be necessary in your business, but eventually it’s likely the need will at some point arise. Speak to O'Connell TELS to ensure you get it right the first time, and protect your business.