Best examples of termination clause examples in employment agreements

Straightforward examples of termination clause language employers actually use

Most people only see termination language when something has already gone wrong. That’s the worst time to discover your contract is vague. Walking through real examples of termination clause examples in employment agreements helps you benchmark what is typical, what is aggressive, and what is flat‑out risky.

Below are sample clauses in plain English. They’re not one‑size‑fits‑all, and they must be tailored to local law, but they give you a realistic starting point for your own employment agreement templates.

Example of “termination without cause” in a standard employment agreement

A classic starting point is the no‑fault exit: the employer wants the flexibility to end the relationship even if the employee has done nothing wrong. Here is a realistic example of termination clause language for that situation:

Sample – Termination Without Cause
The Company may terminate the Employee’s employment at any time without cause by providing the Employee with [two (2) weeks] prior written notice or pay in lieu of such notice, or any greater notice or severance required by applicable law. Upon termination without cause, the Employee will be entitled to payment of (a) accrued but unpaid base salary, (b) accrued but unused vacation, and (c) any earned but unpaid bonus as of the termination date, subject to applicable withholdings.

This is one of the best examples for a basic, at‑will style clause outside of strict U.S. at‑will states, because it:

• Spells out notice or pay in lieu.
• Clarifies what the employee actually receives on exit.
• References local law so the clause doesn’t undercut statutory minimums.

In U.S. at‑will states, you often see a shorter version that simply confirms employment is at‑will and can be ended by either party at any time, with or without cause, subject to applicable law. For a quick legal primer on at‑will employment and termination rights, the U.S. Department of Labor’s guidance is a useful reference: https://www.dol.gov/general/topic/termination.

Examples of “termination for cause” clauses with modern risk language

When people ask for examples of termination clause examples in employment agreements, they usually care most about the “for cause” part. That’s where the conflict (and litigation) tends to land.

Here is a modern, realistic example of a for‑cause clause:

Sample – Termination For Cause
The Company may terminate the Employee’s employment immediately, without notice or payment in lieu of notice, for Cause. For purposes of this Agreement, “Cause” means: (a) willful misconduct or gross negligence in the performance of the Employee’s duties; (b) material breach of this Agreement or of any written Company policy, including but not limited to the Company’s code of conduct, anti‑harassment, and data security policies; (c) conviction of, or plea of guilty or nolo contendere to, a felony or any crime involving fraud, dishonesty, or moral turpitude; (d) theft, embezzlement, or misappropriation of Company property; or (e) repeated failure to perform assigned duties after written notice and a reasonable opportunity to cure, if such failure is curable.

For 2024–2025, some of the best examples of for‑cause clauses now explicitly reference:

• Data security and privacy violations (think mishandling personal data, violating cybersecurity policy).
• Remote work policies (failure to comply with required security practices while working from home).
• Compliance with AI and tech use policies (misuse of AI tools, unauthorized use of proprietary code or datasets).

You increasingly see language like “violation of the Company’s information security, confidentiality, or acceptable use policies” embedded in the definition of Cause.

Real examples of probationary period termination wording

Probationary periods are common in employment agreement templates, especially for entry‑level or operational roles. Employers want more flexibility early on; employees want clarity on what that means.

Here is a realistic example of a probationary term:

Sample – Probationary Period and Termination
The first [90] days of employment will be a probationary period. During the probationary period, either the Company or the Employee may terminate the employment relationship at any time, with or without cause, upon [one (1) week] prior written notice or payment in lieu of notice, where permitted by law. After the probationary period, the notice and severance provisions set out in Section [X] will apply.

In some jurisdictions outside the U.S., statutory rules limit how probation works. That’s why examples of termination clause examples in employment agreements almost always reference “where permitted by law” or “subject to applicable employment standards legislation.” If you’re drafting for a cross‑border workforce, you want your template to anticipate those restrictions.

Executive‑level examples: termination, severance, and “good reason” exits

Executive contracts tend to be more detailed, especially around severance and equity. The best examples of termination clauses for executives usually bundle together:

• Termination without cause (with enhanced severance).
• Termination for cause (no severance, forfeiture of equity).
• Resignation for “Good Reason” (treated like a no‑cause termination).

Here is a condensed but realistic example of termination clause language for an executive:

Sample – Executive Termination and Severance
(a) Termination by the Company Without Cause or by the Executive for Good Reason. The Company may terminate the Executive’s employment at any time without Cause upon [60] days’ prior written notice. The Executive may terminate employment for Good Reason (as defined below) upon [30] days’ prior written notice and failure by the Company to cure within such period. Upon such termination, subject to the Executive’s execution and non‑revocation of a release of claims in favor of the Company, the Executive will be entitled to: (i) [6] months of base salary, payable in accordance with the Company’s normal payroll practices; (ii) payment of any earned but unpaid bonus for the prior fiscal year; (iii) a pro‑rated bonus for the year of termination based on actual performance; and (iv) continued health insurance benefits under COBRA at active‑employee rates for [6] months, to the extent permitted by law.
(b) Termination for Cause or Resignation Without Good Reason. If the Company terminates the Executive for Cause, or the Executive resigns without Good Reason, the Executive will be entitled only to accrued but unpaid base salary and accrued but unused vacation through the termination date.

Definitions of Good Reason often include material pay cuts, significant demotions, forced relocation, or major changes in reporting structure. In 2024–2025, executive agreements are also paying more attention to:

• Change‑in‑control events (mergers, acquisitions, private equity buyouts).
• Clawback policies tied to misconduct or financial restatements.

The U.S. Securities and Exchange Commission (SEC) has guidance on executive compensation, severance, and clawbacks that’s useful background when you’re drafting these higher‑stakes clauses: https://www.sec.gov/corpfin.

Layoff and redundancy examples in termination clauses

Not every termination is about misconduct. Sometimes it’s business: restructuring, automation, or a downturn. Examples of termination clause examples in employment agreements for layoffs often use phrases like “reduction in force,” “position elimination,” or “redundancy.”

Here’s a practical example:

Sample – Termination Due to Position Elimination or Reduction in Force
The Company may terminate the Employee’s employment due to the elimination of the Employee’s position, a reduction in force, or other business restructuring. In such event, the Employee will receive: (a) [two (2) weeks] of base salary for each completed year of service, subject to a minimum of [four (4) weeks] and a maximum of [twenty‑six (26) weeks]; (b) payment of accrued but unpaid base salary and accrued but unused vacation; and (c) eligibility to continue group health insurance coverage in accordance with COBRA or similar applicable law. The Company may require the Employee to sign a separation and release agreement as a condition of receiving severance benefits, to the extent permitted by law.

Post‑COVID and into 2025, you see contracts referencing:

• Remote role elimination when companies pull workers back on‑site.
• Technology‑driven restructuring (e.g., automation, AI implementation) as a basis for redundancy.

If you’re in the U.S., make sure your termination and layoff clauses are consistent with:

• The WARN Act and mini‑WARN laws for mass layoffs (see the U.S. Department of Labor overview: https://www.dol.gov/agencies/eta/layoffs/warn).
• Anti‑discrimination and retaliation protections enforced by the EEOC: https://www.eeoc.gov.

Fixed‑term contract examples and early termination clauses

Fixed‑term agreements (for a set number of months or years) are common for project‑based roles, academic appointments, and some international hires. Termination clauses need to explain what happens if the relationship ends before the term is up.

Here is a realistic example of an early termination clause in a fixed‑term contract:

Sample – Fixed‑Term and Early Termination
This Agreement will commence on [Start Date] and will continue until [End Date], unless earlier terminated in accordance with this Section. Either party may terminate this Agreement prior to the End Date: (a) for Cause (as defined herein), effective immediately upon written notice; or (b) without cause upon [30] days’ prior written notice. If the Company terminates the Agreement without cause prior to the End Date, the Employee will be entitled to [three (3) months] of base salary as liquidated damages, less applicable withholdings, in addition to accrued but unpaid compensation. If the Employee resigns without Good Reason prior to the End Date, the Employee will be entitled only to compensation accrued through the termination date.

The best examples of fixed‑term termination clauses make three things very clear:

• Whether the term auto‑renews or simply ends.
• How early termination works for each side.
• Whether any early‑termination payment is a cap on liability or just a minimum.

If you’re drafting for a jurisdiction with strict rules on fixed‑term contracts (for example, some EU countries), you’ll want local legal advice to make sure your examples of termination clause examples in employment agreements don’t accidentally violate statutory protections.

Remote work and hybrid work: newer examples of termination language

Since 2020, remote and hybrid work have rewritten a lot of boilerplate. By 2024–2025, many employers are explicitly tying continued employment to compliance with remote‑work rules.

Here is an example of how that can appear in a termination clause or related section:

Sample – Remote Work Compliance and Termination
The Employee’s continued eligibility to work remotely is subject to the Employee’s compliance with the Company’s remote work policies, including but not limited to data security, confidentiality, and productivity requirements. Material or repeated violation of such policies may constitute Cause for termination under this Agreement. The Company reserves the right, upon [30] days’ written notice, to require the Employee to perform duties from a designated Company office. The Employee’s refusal, without a documented medical or legally protected reason, to comply with a reasonable, job‑related requirement to return to the office may constitute voluntary resignation or Good Reason, as applicable, under this Agreement.

These are modern examples of termination clause examples in employment agreements that respond to very current realities: cybersecurity risks, cross‑border tax and immigration issues, and disputes over return‑to‑office mandates.

For broader context on remote work, productivity, and workplace safety obligations, the U.S. Occupational Safety and Health Administration (OSHA) and academic research from institutions like Harvard can be useful background reading, even if they don’t provide template language: https://www.osha.gov and https://www.harvard.edu.

Legal guardrails when using these examples in your own templates

Using examples of termination clause examples in employment agreements is smart; copying them blindly is not. A few guardrails to keep in mind:

• Local law always wins. Employment law is highly jurisdiction‑specific. A clause that works in Texas might be illegal in Ontario or Paris. Always cross‑check with local statutes and case law.
• Minimum standards matter. Many countries and U.S. states have minimum notice, severance, or accrued‑vacation rules. Your contract can give more, but not less.
• At‑will vs. contractual rights. In the U.S., at‑will employment is common, but as soon as you start promising specific notice or severance, you’re creating contractual expectations that limit pure at‑will flexibility.
• Anti‑discrimination and retaliation. Termination rights in a contract cannot override anti‑discrimination protections or whistleblower laws. The Equal Employment Opportunity Commission (EEOC) has clear guidance here: https://www.eeoc.gov.
• Clarity beats cleverness. Courts tend to interpret ambiguities against the drafter (usually the employer). If you want a right, say it plainly.

Think of these real examples as a drafting toolbox. They show how different pieces can fit together—cause, no‑cause, severance, probation, fixed‑term, remote work—but they still need professional tailoring.

FAQ: examples and practical questions about termination clauses

Q1. What is a good example of a basic termination clause in an at‑will U.S. employment agreement?
A common example of a basic at‑will clause is: “Employment with the Company is at‑will. This means that either you or the Company may terminate the employment relationship at any time, with or without cause or advance notice, subject to applicable law.” Employers often layer additional provisions on top of this, such as severance for certain roles or procedures for layoffs, but that sentence captures the core concept.

Q2. Are examples of termination clause examples in employment agreements different for remote workers?
Yes. While the core rights (for cause, without cause, severance) may be similar, many 2024–2025 contracts add language about compliance with remote work, data security, and time‑tracking policies. For cross‑border remote workers, tax, immigration, and data‑transfer rules can also affect how termination and notice are handled.

Q3. Can you give an example of a termination clause that includes severance pay?
One example of a severance‑linked clause is: “If the Company terminates your employment without cause, you will receive eight (8) weeks of base salary as severance, subject to your signing and not revoking a separation agreement and release of claims, in a form provided by the Company.” From there, employers often add health‑benefit continuation, outplacement services, or accelerated vesting of some equity awards for higher‑level employees.

Q4. Do courts always enforce termination for cause definitions as written?
Not always. Courts look at the contract language, but also at statutory protections, public policy, and whether the employer followed its own procedures. Overly vague or one‑sided definitions of Cause can be narrowed or disregarded, especially outside purely at‑will jurisdictions. That’s why the best examples of termination clause examples in employment agreements use concrete, specific grounds for Cause and, where appropriate, give employees a chance to cure certain issues.

Q5. Should small businesses use the same termination clauses as large corporations?
Not exactly. The concepts are similar, but small businesses usually need simpler language and more flexibility, while still complying with local law. Large corporations tend to have detailed policies, multi‑layered approvals, and sophisticated severance plans that are overkill for a 10‑person startup. That said, even a small business benefits from clear, written termination clauses instead of relying on vague verbal understandings.

Bottom line: Using real‑world examples of termination clause examples in employment agreements lets you move beyond generic templates and into language that actually matches how your organization hires, manages, and, when necessary, lets people go. Treat these examples as a drafting blueprint, then sit down with counsel to make them fit your laws, your risk tolerance, and your culture.