If an employer has exhausted all the necessary steps to help the employee improve his or her work performance – and those steps are not working – it may be time to terminate the employee.Terminating an employee is not only stressful for the employee losing a job, but also for the employer. There are legal, ethical steps to take when you terminate an employee. The company must ensure its actions are above reproach. How the company terminates an employee sends a powerful message not only to the terminated employee, but also to remaining staff, either positive or negative.