Termination Of Employment Versus Dismissal, Any Differences?

February 27, 2023
Termination of Employment

By Benita Ayo

In the course of my legal practice, I have had clients ask me if there are any differences between a Termination of Employment and a Dismissal from Employment.

These are usual terms used in the employment space, however, they can never be used interchangeably because they mean different things. I will explain the differences below.

Termination of Employment

Termination of Employment means to bring an end to an employment relationship. Termination may be voluntary, as when a worker leaves of his/her accord. Involuntary termination occurs when a company downsizes, makes layoffs, or fires an employee.

Termination comes in four ways, and they are as follows;

  • Involuntary termination: This occurs where an employer fires an employee as a result of downsizing or for whatever reason the employer may come up with.
  • Voluntary termination: This is where an employee turns in his letter of resignation in accordance with the termination clause of the Employment Contract.
  • Wrongful termination: This is where the employment relationship between an employer and employee is brought to an end but not in accordance with the requirements of the Employment Contract.
  • End of a work contract or temporary employment: As the caption states, this is where an employment relationship is determined upon the expiration of the employment term as stated in the contract of employment.

Dismissal from Employment

This is a situation whereby a contract of employment is abruptly brought to an end as a result of an employee’s violation of the company’s policy. The most cited reason for the dismissal of an employee is gross misconduct.

Differences between Termination and Dismissal

The differences between a termination and a dismissal are as follows;


  • The employment relationship is brought to an end via a written Notice of Resignation or Termination of Employment.
  • Payment in lieu of Notice is paid.
  • The employee’s entitlements are paid out, and where they are not paid out to the employee, the employee may sue the employer to recover same.


  • The employment relationship is brought to an end after a disciplinary procedure must have found the employee guilty of a gross misconduct.
  • The employee’s entitlements, except his pension, are forfeited.


In most cases where an end is brought to an employment relationship either by way of termination or dismissal, there is always a resultant effect of such action by way of an aggrieved employee suing an erstwhile employer for damages for wrongful termination or dismissal.

This is why legal advice must be sought by an employer before he grinds the axe against an employee to avoid or mitigate litigation risk, and also the employee should seek legal counsel to ascertain if his or her rights have been infringed upon by an erstwhile employer.

For further consultations, you may reach me at;

WhatsApp: +2348063775768

Email: [email protected]

Benita Ayo is a seasoned corporate commercial Counsel with over 9 years post-call experience. She has handled myriads of briefs in Corporate/Commercial, Employment Law as well as Property Transactional Practice

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