Termination of employment policy template
A comprehensive framework for ending employment fairly and lawfully. Covers resignation, redundancy, dismissal, notice periods, final entitlements and exit procedures aligned with Fair Work requirements.
Termination of employment policy
PDF format • Ready to download
By downloading, you agree to our template disclaimer
Why you need a termination policy
Ending employment—whether initiated by the employer or employee—involves legal obligations, emotional considerations and practical processes. Getting it wrong can result in unfair dismissal claims, underpayment of entitlements, or damaged relationships that affect your reputation.
A termination policy ensures every departure is handled consistently, fairly and lawfully. It sets clear expectations for notice periods, outlines what employees are entitled to, and provides a framework for difficult conversations.
Under Australian law, dismissal must be for a valid reason and follow a fair process. Your policy should embed these requirements so managers know what steps to take, and employees understand their rights and obligations when employment ends.
Key elements your policy should cover
Essential components of a compliant termination policy
Types of termination
<a href="/glossary/resignation">Resignation</a>, <a href="/glossary/redundancy">redundancy</a>, <a href="/glossary/dismissal">dismissal</a> and their differences.
Notice periods
Required notice for different situations and service lengths.
Procedural fairness
Fair process requirements before <a href="/glossary/dismissal">dismissal</a>.
Final entitlements
What employees are owed when leaving.
Documentation
Records and paperwork for terminations.
Exit procedures
Handover, property return and system access.
What's included in this template
A complete framework for managing employment endings
Purpose & scope
Why a termination policy matters and who it applies to.
Policy statement
Core principles of fair and lawful termination.
Types of termination
<a href="/glossary/resignation">Resignation</a>, <a href="/glossary/redundancy">redundancy</a>, <a href="/glossary/dismissal">dismissal</a> and end of contract.
Notice requirements
Notice periods based on service and circumstances.
<a href="/glossary/resignation">Resignation</a> process
How employee-initiated departures are handled.
<a href="/glossary/redundancy">Redundancy</a>
Process for genuine redundancy situations.
<a href="/glossary/dismissal">Dismissal</a> for cause
Termination for misconduct or poor performance.
Final pay and entitlements
What must be paid and when.
Exit procedures
Handover, interviews and property return.
Record keeping
What documentation must be maintained.
Common termination scenarios
How your policy should address typical situations
Employee resignation
When employees resign, your policy should cover required notice periods (check their contract and applicable award), whether notice can be waived or paid out, how to handle requests for early release, and what happens during the notice period regarding duties, leave, and system access.
Genuine redundancy
Redundancy must be genuine—the job must no longer exist, not just the person in it. Your policy should outline consultation requirements, redeployment considerations, selection criteria for choosing between employees, notice periods, and redundancy pay calculations. Getting this wrong can turn a redundancy into an unfair dismissal.
Dismissal for poor performance
Before dismissing for performance, you typically need documented concerns, clear expectations communicated to the employee, genuine opportunity to improve with support, and a final meeting where the employee can respond. Your policy should reference your performance management and capability policies and require these steps before termination.
Summary dismissal for serious misconduct
Serious misconduct (theft, violence, serious safety breaches) may warrant immediate dismissal without notice. However, you still need to investigate the allegation and give the employee an opportunity to respond before making a decision. Your policy should define serious misconduct and outline the abbreviated process that still maintains procedural fairness.
Who should use this template?
Any business that employs people
Legal disclaimer
This template is designed to reflect Australian workplace standards and Fair Work principles at the time of publication. It is provided as a general guide only and does not constitute legal advice.
Termination of employment is a high-risk area with significant legal consequences for getting it wrong. Notice periods, redundancy pay, and dismissal procedures vary based on awards, enterprise agreements, and individual contracts. For any termination initiated by the employer, we strongly recommend seeking independent legal or HR advice.
Regulatory sources
This template is aligned with Australian employment termination requirements.
Ready to manage terminations fairly?
Download our termination policy template and ensure every departure is handled professionally and lawfully.
Looking for more HR templates? Browse all performance & employment templates
Store this policy and track employee acknowledgements with RosterElf's HR software.
Termination policy FAQ
- Yes. This template provides a solid foundation, but you should tailor it to reflect your specific workplace, management structure, and any applicable modern award or enterprise agreement. Ensure procedures align with Fair Work requirements for procedural fairness.
- Distribute the policy during onboarding for new employees and via email or team meetings for existing staff. Have employees sign an acknowledgement form confirming they have read and understood the policy. Using HR software with policy management can automate tracking of acknowledgements.
- Minimum notice under the NES depends on length of service: 1 week (less than 1 year), 2 weeks (1-3 years), 3 weeks (3-5 years), or 4 weeks (5+ years), plus an extra week for employees over 45 with 2+ years service. Awards may provide longer periods. See our guide on how to terminate an employee.
- Final payments must include all outstanding wages, accrued annual leave, and any long service leave entitlements. Notice period pay applies unless serious misconduct justifies summary dismissal. Payments should be made within 7 days of termination. Learn how to calculate final pay.
- If you hire someone to do the same or substantially similar job, the redundancy may not be genuine. Genuine redundancy requires the job itself to no longer exist. Restructuring must be real and not simply a means to exit a particular employee, which could lead to unfair dismissal claims.
Related guides
Learn more about implementing this policy
How to conduct a performance review
Step-by-step guide to running effective performance reviews.
Read guideHow to terminate an employee fairly
Fair employee termination covering legal requirements.
Read guideHow to onboard a new employee
Complete onboarding checklist for Australian businesses.
Read guideRelated templates
Complement your termination policy with these related documents
Exit management policy
Detailed procedures for managing the practical aspects of employee departures.
View templateMisconduct policy
Framework for disciplinary process that may lead to termination.
View templatePerformance management policy
Required process before terminating for performance reasons.
View templateDisclaimer
This document is a general HR template provided for informational purposes only. It is not legal advice and may not reflect the latest changes in legislation or apply to every workplace situation. RosterElf Pty Ltd and the template provider accept no liability for any loss arising from reliance on this document. Users should seek independent legal advice and customise the template to ensure it complies with all relevant laws, awards and workplace requirements.