How to Politely Inform a Senior Ex-GM About Contract Termination?

Hi, We have engaged a person under contract terms. His contract period is due for renewal. Our management has decided not to continue, so we need to issue a letter to inform him. He is very senior; previously, he worked as GM - Operations in our company. After his retirement, the management asked him to continue on a contract basis.

Please share with us a formal letter informing him that the contract is going to be terminated.

Thanks and regards, Rajesh

It is not advisable to give a formal letter informing the individual that his service would be terminated. Since he is already under a fixed-term contract and is due for renewal, you can verbally inform him that management would not like to renew his contract. Therefore, his service would come to an end on [specific date], i.e., the date as per the contract in place. Since a fixed-term contract will terminate automatically, there is no need to provide a termination letter if the contract is not renewed. Issuing such a letter of termination would create stigma, which is unfair, especially in the case of an employee who has been granted an extension after reaching the original superannuation age. Hence, please call him and inform him that his contract will not be renewed. The remaining details will be communicated to him directly.

I agree with Mr. Madhu, though for a slightly different reason. Any letter of termination can be used later if there is a dispute, and the person can claim unfair dismissal, etc. He is not likely to win (but it depends on the circumstances), but it's better not to create such a document at all.

Instead, perhaps you can have a relieving letter issued, with glowing thanks for his contribution to the company and its growth, etc. (I am assuming they are parting on good terms). Such a letter will be taken in good spirit and would be treasured by the senior manager who is leaving and is unlikely to be of any use in a future dispute.

But we are all guessing on this, and it depends on the circumstances that we have little knowledge of.

Dear Rajesh,

[Your Company Letterhead] [Date]

[Recipient's Name] [Recipient's Address]

Dear [Recipient's Name],

I hope this letter finds you in good health and high spirits. We are writing to inform you about the decision of the management regarding the renewal of your contract with [Your Company Name].

After careful consideration and evaluation of our current business needs and organizational structure, it has been decided that we will not be renewing your contract for the position of [Recipient's Position] at the end of its current term. This decision is not a reflection of your performance, as we have always valued your dedication, expertise, and contribution to the company.

We understand that this news may come as a disappointment, and we want to express our sincere gratitude for the exceptional service and commitment you have demonstrated during your time with us. Your leadership as the former GM - Operations has been invaluable, and your continued support on a contract basis has been greatly appreciated.

We want to assure you that this decision is purely a result of our internal restructuring and does not diminish the respect and admiration we hold for you. We are committed to providing any necessary support during this transition period and are open to discussing any concerns or queries you may have.

We would like to take this opportunity to thank you once again for your hard work and dedication to our company. We wish you all the best in your future endeavors and hope that our paths may cross again in the future.

Sincerely [Your Title] [Your Company Name] [Contact Information]

Thanks