Letter of Reference
If you are involuntarily releasing an employee from the company, do not agree to submit a letter of reference. If you feel that the employee's performance was not adequate enough to remain on your payroll, raving about him to a prospective employer could cause problems down the road if the employee tries to challenge the separation. You can give the employee a letter on company letterhead that indicates the dates of employment and position.
When you have to lay off an employee due to no fault of his own, you'll want to help him find another job as best you can. Give him a letter of reference that highlights his attendance, dependability, behavior, positive attitude, and skills. Mention any significant accomplishments, and go ahead and indicate that the layoff was due to cutbacks or whatever the situation may be.
An employee may request copies of things from his personnel file that will help him get another job. He may want a copy of his performance appraisal, commendation forms, awards, or training certificates.