Layoffs aren’t easy on anyone, and delivering the bad news is taxing. Especially when your company lays off colleagues you’ve come to know well. But if you find yourself in a situation where you have to break the bad news, it’s a good idea to use layoff letter templates that cover the essentials—including the effective date and any compensation the employee will receive. If possible, it’s also a good idea to provide the affected employee with a severance package.
Delivering the news won’t be easy, but it’s important to communicate the next steps clearly so that you can help your team member prepare for their future.
How do you write a layoff letter?
A layoff letter should inform the employee that they’ve been laid off, explain the reason, and let them know what the next steps are. Companies issue layoff letters when they need to temporarily or permanently terminate employment, due to reasons that aren’t related to an employee’s performance (like economic conditions or a merger).
Your letter should include the following information:
Employee details. Include their name, employee ID, designation, and the department they work in.
Compensation. Include any severance, benefits, or other forms of compensation that the employee is entitled to. Benefits usually extend beyond the termination date, so make sure you check and specify when they’ll end.
Items to be returned. Is there any company property that the employee needs to return, such as a laptop, company phone, other IT equipment, or their employee ID card?
The manager/supervisor’s name. Include the name of the person who’s managing the termination process.
Legal documents. Has the employee signed anything like a non-compete or an NDA?
After you’re done drafting your layoff letter, make sure you run it by your company’s legal team before sending it over to the employee.
How do you send a layoff email?
After writing your layoff letter, make sure you run it by legal counsel before sending it forward. Don’t skip this step! It could protect you from unwanted legal action down the line if there is something in your dismissal that isn’t compliant. Then, get in touch with HR or the employee’s line manager (unless you’re one of the two) about conducting an exit interview with them.
Once you’ve done all this, send the layoff email to the employee, with all the important information listed in the previous section.
What does a laid-off letter look like?
Here’s a sample laid-off letter to give you an idea of what a finished one should look like:
Dear Kyle McGowan,
It is with great regret that I inform you that you are being laid off from your position as Marketing Operations Manager, effective 31 January 2024.
I would like to stress that this layoff is in no way related to your individual performance. It is purely a consequence of the recent economic downturn, which has slowed our next funding round and forced us to lay off valued employees.
This layoff is indefinite and should be considered permanent.
You’ll continue to receive your benefits, including healthcare and dental, until 1 March 2024. For your efforts, you will also receive $40,000 in severance.
Please make sure you return the following company property by 31 January 2024:
Your laptop
Your employee ID card
Any other company IT equipment
Thank you for your contributions to the company. I sincerely regret that the economic conditions have brought this on, and wish you all the best in all your future endeavors.
Sincerely,
Alice Humphries
Head of Human Resources
Layoff letter samples: 2 layoff letter templates
Here are two layoff letter templates that you can adapt and use. But—and we can’t stress this enough—make sure you run the finished version by legal before sending it forward.
Simple Layoff Letter Template
I regret to inform you that you are being laid off from your position as {designation}, effective from Date.
Unfortunately, this decision is a consequence of the recent Reason 1, which has forced Company Name to take this tough step. I’d like you to know that it has nothing to do with your individual performance.
This layoff is indefinite and should be considered permanent.
You’ll continue to receive your Benefits until Date. For your efforts, you will also receive Severance Pay in severance.
Please make sure you return the following company property by Date:
{List the property that needs returning}
Thank you for your contributions to the company. I sincerely regret that Reason 1 and Reason 2 brought this on.
I wish you the best in all your future endeavors.
Sincerely,
Your Name
Job Title Add free template to Magical
Detailed Layoff Letter Template
Regretfully, I am writing to inform you that, as of Date, you will be laid off from your position as Job Title.
This was not an easy decision, and let me clarify that it is not related to your performance. Unfortunately, the company is going through Reason 1, Reason 2, and Reason 3, which requires us to lay off employees.
As for your compensation, your last paycheck will be deposited to your bank account on Date. If you do not have direct deposit, it will be mailed to you. You will be compensated for any PTO that you haven’t used and you’ll continue to receive your other benefits until Date.
Additionally, for your hard work and loyalty, you will receive an additional severance compensation of Severance Pay.
Please return the following items to your department by Date:
{List the property that needs returning}
Please know that we sincerely appreciate all the contributions you’ve made during your tenure, and we wish you the best in your future endeavors. HR will be in touch for your exit interview on Date.
If you have any inquiries, please contact HR Contact here: Email.
Sincerely,
Your Name
Job Title Add free template to Magical
Communicating mass layoffs: learning from real examples
Unfortunately, companies end up conducting mass layoffs sometimes. Over the past couple of years, there have been significant layoffs in tech—with organizations like Microsoft, Amazon, Spotify, and Shopify laying off percentages of their workforce. There’s no good template for a mass layoff situation like this… it needs to be a thoughtful, personal explanation from your CEO.
If your company finds itself in a situation where it needs to conduct mass layoffs, it’s worth looking at how Shopify thoughtfully handled the situation. Shopify’s CEO issued a statement thoroughly explaining the reason for the company’s layoffs, accepting full responsibility for the situation, and announcing generous severance packages. You can read Tobias Lütke's letter in full here.
Similarly, Spotify’s CEO communicated changes in the company’s organizational culture, and explained why it was taking the difficult step in laying off employees. It, too, offered generous severance packages and 1:1 exit interviews for affected employees. Read Daniel Ek’s full letter here.
Layoffs are hard on everyone, so it’s really important to treat the situation with care and to make the transition as easy as possible. Whether you’re laying off a couple of employees or hundreds of them, try to make sure employees are compensated as best you can, and make the next steps as smooth as possible. At the risk of sounding cliché, a little kindness goes a long way.
