The best practice for terminating an employee is to do it in person with a companywitness (to avoid he said/she said-type evidence). However, my guess is that the question actually is asking much more, so I'll take a stab at it.
When considering terminating an employee, you need to identify whether the reason for the termination is poor performance or misconduct (and by misconduct, I mean that the worker has violated company policy warranting termination). If the reason for the termination is poor work performance, in a perfect world, the manager has engaged in a performance management process that documents the company's efforts to identify the performance problem and assist the worker in reaching or re-reaching the expected performance standard. The typical process usually includes: (1) coaching and counseling – verbally identifying the performance problem and advising the employee on how to improve; (2) written warning – identifying the nature of the performance problem in a written warning that is presented to the employee, along with a written statementof the performance expectation the employee should strive to meet; and (3) a formal performance improvement plan (PIP) which includes a detailed outline of the performance problems, sets the performance standards, identifies the actions the manager will take to assist the under-performing employee, andadvises theworker that if the performance standard is not reached within a proscribed (reaonable) period of time, then discipline"up to and includingtermination" may be taken. It is important to actually tell the employee that their job is at risk so that if a termination occurs, they will not be surprised. It is also importantfor the manager tocheck in and assess the employee on a weekly or bi-weekly basis during the PIP period so that they know if they are on track or not, and have appropriate expectations as the PIP period draws to a close.
Misconduct terminations are similar in that you want to ensure that you have as consistent a process in place as possible, but there is an additionalwrinkle. If an employee is accused of misconduct or violationof company policy,an investigation should take place to give the employee a sort of "due process" right to face theaccusation and beallowed to defend him or herself. For example, if an employee is accused ofviolatinga company policy that prohibits posting about confidential company activities on a social networking site, then the company should investigate by taking the statement of whomever informed on the employee (or capturing a screenshot of the posting if possible), then confront the employee with the information obtained and ask them for an explanation. If the explanation is notplausible, or is otherwise unsatisfactory,the disciplinary process set forth above should be engaged and documentation demonstratingthe company's efforts to bring theworker's conduct back in line with company policy should be generated and retained.
Once thecontemporaneous documentation demonstrating that the employer had a legitimate business reason for the termination is in place, and a termination decision has been made, advise the terminated employee in private in a dignified way and (depending on the law of your state) present them with their final paycheck, includingaccrued unused vacation. The rule in California is that you have to pay the final paycheck,including unused vacation, at the time of termination. Ifyou delay thepayment of an accurate final paycheck, then the employer ispenalized one days' wages for every day the employee must wait for the paycheck, up to30 days (which is the equivalent of up to six weeks of pay). If the final paycheck is paid promptly,but it is"short" due to the employer's miscalculation, then the samepenalties applie until the balance is paid (up to 30 days).






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