The penalty of termination is appropriate and not shocking to one's sense of fairness.[/i][/b]

Termination policy will typically include the following points:[/i][/b]
The terms of a severance package, which is usually commensurate with the length of time the individual has been employed and his or her position in the company[/i]
Payment to the employee for unused vacation days[/i]
Provisions for continuing health benefits after termination[/i]
Whether a letter of recommendation is given for potential future employers[/i]
Before taking the decision to terminate an employee possess a reasonable, legitimate and documented reason for the termination of that particular person. Then collect the keys, I.D.’s and other company related materials in the employee’s possession also make sure that you know his PC passwords because things create a lot of confusion after the employees leaves the company. The news of termination should be given in person. Do not terminate of fire anyone on the basis of rumors or unsubstantiated claims or for personal or discriminatory purposes. Keep the tone of a termination meeting positive; creating a tense atmosphere may make your employee resentful and more likely to resort to legal action. At the time of exit interview start the talk by thanking the employee for his valuable contribution to the company. Explain the reason for his termination. Let the employee understand that he is fired/terminated and let him ask questions to get things cleared. End on a positive note. Thank the employee for their contributions and wish them luck in the future. When the meeting is over, stand up and shake their hand.
The risks associated with terminating employees can be solved in the following manner:[/i][/b]
Possess an open communication climate with all employees.
Make the employees understand how their work fits into the big picture and the strategic goals of the company and the contribution they can make to achieve the organizational goals.
Communicate what you expect from employees regularly.
In conjunction with the employee, create clearly articulated performance goals by quarter and by year. Include metrics by which accomplishing the goals can be measured.
Check the progress of employees and also think upon points to be done to improve the performance and how work can correlate with others working in the firm.
Conduct annual performance reviews (written and oral). Provide employees with an honest assessment of their work, growth, strengths, and weaknesses and seek feedback from employees to determine if their view of their performance is in sync with the supervisor's view.
Then set goals for the coming quarters and year.
Never surprise an employee with negative performance feedback for the first time in a review. By the time an employee receives a review, they should already have been made aware of any concerns about their performance and been given an opportunity to improve performance with management's support.
Communication clearly of what is needed from the employee will help possess no doubts in the minds of employee as regards anything.
Create clearly articulated at-will employment policies.
Include a disclaimer in the employee handbook that the company reserves the right to change, amend, and terminate HR policies at the company's discretion, but the at-will policy will never be changed.
Establish a performance management process that encourages ongoing performance conversations between supervisors and employees throughout the year and hold your supervisors responsible in this regard.
Develop interactive training for supervisors regarding at-will employment, discipline, and the performance-management process. Include information about documentation standards they are expected to follow.
Educate managers about workplace laws, how those laws impact their daily relationships with employees, and how to use those laws to improve their communications overall. Roll out effective management training programs where they can practice those skills.
Termination of services by employees needs immense soft skills and technique to handle employees at ease so that they feel their termination as having negative impact on their personality and take their employment in positive spirit.