A termination letter due to restructuring is a formal letter, that is written by the employer of the organization on the company letterhead. It is addressed to the employee, who is being terminated because of the restructuring, that has been carried out in the employee’s department or the overall company. In this letter, the employer informs the employee about the termination and provides a reason and justification for his termination.
Restructuring is a process that changes the processes, operations, hierarchies, etc., in the structure of an organization. The reasons behind the restructuring could be many, such as mergers, takeovers, etc. The overall aim of the restructuring is to increase the effectiveness and efficiency of the new organizational arrangement. During the restructuring, to meet the new goals and objectives, often, few departments and positions get eliminated, which indicates the termination of few employees as well.
Unless otherwise required, to end the employer-employee relationship on a good note, usually, the companies provide an explanation behind the restructuring and the termination of employees. To inform the employees, a termination letter due to restructuring is issued to them. The information included in such letters may vary as per the circumstances as well as the new organization’s policies. However, generally, the following details are included in such letters:
- Employee details.
- Employer details.
- Details of restructuring, including its reason, effects, etc.
- Termination notice.
- Effective date of termination.
- Emphasize the importance and requirement of restructuring.
- Show regret.
- Compensation, if any.
- Offer recommendation letter.
- Any attached documents, cheques, etc.
Although the termination news is never good news for an employee, when he receives this letter from his employer, he may understand that the employer took the decision for the betterment of the organization and cared enough to provide detailed reasoning behind his termination.
In addition, such termination letters due to restructuring do not affect the image of an employee for his new employers, as the termination did not happen due to the employee’s fault, but due to the changes in the company. In such cases, the companies, usually, do not hesitate to provide a good recommendation letter to the terminated employees, which may help them in seeking a new job.
As for the employers, it is important that they write the letter in a tone, which shows that they are not happy to terminate their employees. Furthermore, they should try to compensate the employee in any possible way.
Sample Termination Letter due to Restructuring
Dear Mr. John,
We regret to inform you that you have been terminated from your current position of ‘Junior manager’ at ABC Limited due to the recent restructuring our company went through. This termination will be effective from 1st September 20XX.
As you are aware of ABC’s merger with XYZ limited, a restructuring process has been carried out to effectively meet the objectives of the newly formed organization. Among the other changes, one of them was the elimination of several positions. Unfortunately, your position has been removed from the hierarchical chart as well.
Although we did not want to lose any of our employees, this restructuring was necessary to meet up the new requirements.
We are aware that it cannot fully compensate for your loss of the job, but, as a gesture, we are sending a cheque equivalent to the amount of your two salaries. Also, let us know if you need a recommendation for your job in the future.
Thank you for your understanding.
Format: Word [13KB]
Manager IT Department
Dated: 28th February 20XX
Subject: Termination due to restructuring
It is regrettably stated that our company is facing major restructuring issues due to our merger with other company. This merger is very crucial for the sustenance of the company as the pandemic and lockdown have drowned everyone. The merger happened smoothly but there are consequences in the manner of restructuring every avenue of the company that includes projects, departments as well as employees.
Therefore, I regret to inform you that you are being terminated as the manager of the IT department. No further appointments are being made because managing employees of both companies as one is crucial. You have been an asset to our company and your projects will always be remembered due to your hard work and bright ideas.
After the merger, companies will be more focused on other avenues and are thinking of dissolving the IT department. The restructuring allows us to focus on the major department to catch big projects by limiting the area of spread. You will always have exceptional recommendations from our company for your future endeavors.
Director ABC Company
Format: Word [13KB]