Letter to Terminate Employment Due to Workforce Reduction

How are employers able to pay their employees? It is by generating revenues from their business. But since businesses don’t remain static, they keep moving between profit and loss, there come times when a business faces financial pressures and continuous loss, and this bars the business employer to continue to pay his employees since no profit or progress is being made.

In such situations, in order to reduce the load, workforce reduction is done. That is, some employees are terminated. Because in such cases, an employee is not terminated for any of his faults but due to the debacle a business is facing, it is necessary to apologize to the employee for this termination, grant him a reference letter and employment confirmation letter so that he may find a better opportunity for himself.

Letter -1

I [Title] [Name] from [Department name] wish to inform you that the company has been suffering continuous losses for the past [number] months. The sales per branch have decreased greatly. In light of all this, the company has decided to reduce the number of branches per city. We regret to inform you that your branch is being merged with [branch name] and your services are no longer required. Your contract is also being terminated, effective [Date].

You will be given the next two months’ pay and your [provident] fund will also be paid in full. You were issued with a laptop at the time of hiring, please return that latest by [Date]. Your contact person in this regard would be Mr. [name] in [Department name]. You can contact him by

Phone: [phone number]
Email: [email address]

We would like to thank you for all the hard work and dedication you have shown in the [number] years that you worked for [company name]. We apologize for the inconvenience this decision would cause you and wish you all the best in your future endeavors.

Yours sincerely,


Dear Mr. [name]

I [Title] [Name] am writing to inform you about the decision to terminate your contract. As it was intimidated earlier that the management had decided to reduce the workforce by [number] percent. This painful decision had to be taken due to the unprecedented challenges caused by Covid. The hospitality industry was hit the worst by this pandemic and our hotel is no exception.

Workforce reduction was inevitable, but we delayed this painful step for as long as possible now it seems that the only way forward is with reduced staff at least till the time that things get back to normal.

You would be paid two months’ salary in advance. Also, when travel restrictions are removed and the hotel is operating at its full potential and we are rehiring, preference would be given to old employees. For clearance of your dues, please get in touch with Mr. [name] in [department name]. In the end, we would like to thank you for all the hard work you have put in while you were with us. We wish you all the best for the future.

Looking forward to your cooperation and understanding,

Yours sincerely,

Letter -3

Dear [recipient’s name],

I am sorry to inform you that your employment has been terminated. This is because we are reducing the workforce since the financial conditions of the business do not allow us to keep a large workforce. Also, because we have no projects at the moment, nor are we in a condition to start our own, we don’t have work to offer. Please note that this is not the case with you alone. We are keeping only a limited number of employees that we need and all other employees have been terminated.

Please accept an apology from [enter company] that you have to leave us this way. To help you find a better opportunity, we’ve enclosed an employment confirmation letter.

Wish you good luck in your future endeavors.

Exit mobile version