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Termination Letter (with Full & Final Settlement) Format & Template

Employment & HR · ₹50 · ~6 min · Sign in free, fill the guided form with a live preview, pay to download.

What is a Termination Letter (with Full & Final Settlement)?

A termination letter formally communicates an employer’s decision to end an employee’s employment. It states the reason, the last working day, the notice period or pay in lieu, and the full and final settlement of dues.

How a termination must be carried out depends on the employee’s contract and on labour law: for workers covered by industrial relations law, termination and retrenchment carry procedural and compensation requirements, and misconduct terminations normally need a fair enquiry first.

When to use it

  • An employee is being terminated for performance, misconduct or redundancy.
  • The employment is ending at the close of a probation period.
  • You need to document the full and final settlement.

What you'll need

Keep these details ready — the form asks for them in this order.

Company

Company name

Employee

Employee's full name · Designation

Termination

Reason for termination · Last working day

Settlement

Full & final settlement amount, if applicable (optional) · Letter issue date · HR representative name

How it works

  1. Enter company and employee

    Company, employee’s name and designation.

  2. State reason and last day

    The reason for termination and last working day.

  3. Record the settlement

    Full and final settlement amount, if any.

  4. Preview, pay and download

    Pay ₹50 and download to issue on letterhead.

How to make it legally valid

  • Issued in line with the appointment terms and any applicable standing orders or labour law.
  • Notice given, or pay in lieu of notice, as the contract or law requires.
  • For misconduct, a show-cause notice and enquiry before termination.
  • Full and final settlement paid promptly, within any time limit the law sets.

Common mistakes to avoid

  • Terminating for misconduct without an enquiry.
  • Withholding statutory dues such as gratuity or earned leave encashment.
  • A stated reason that contradicts the employee’s records.

Ready to prepare your Termination Letter (with Full & Final Settlement)?

₹50 · live preview before you pay

Start Termination Letter (with Full & Final Settlement)

This is a self-help template for common situations — it is not legal advice and LawMitran is not a law firm. Need help with your termination letter (with full & final settlement)? Find a employment law lawyer · Legal documents FAQs.