The Warning Letter or MEMO - as usually known, is a first step towards initiating a reform or disciplinary action against a delinquent employee. Such a communication, initially, be polite and must convey a message strongly to him that he is being found nagging on such and such count and he should give a special attention to those points. Remind him/her that company has great hopes from him and company wants him to grow with it.
Still found lacking, a second Memo should follow with a little bit of concern conveying your displeasure and asking him to be careful. Tell him that his moments will be watched and he will be under critical scanner.
The Third one could be real Disciplinary one. Tell him that despite the opportunities afforded to him to improve, he is still not come up to the mark and if this continuous, company will have no option but to proceed with the disciplinary proceedings against him.
Lastly issue him a show cause notice as to why his services may not be parted with as per law, and ask for his explanation his position within a stipulated time frame. On receipt (or non receipt) of reply, proceed as per T&C of appointment under the law to penalize him, which may be a simple warning to termination or dismissal (a wide range of options are available under this) from the services.
In the meanwhile, punctuate your actions with meetings, trainings, problem solving and other managerial devices to mend the situation and keep a record of the same.
19th October 2010 From India, Chandigarh