Daycare Termination Letters for Providers - Templates & How To

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While daycare centers are an essential service for parents and a great place for children and caregivers to interact, there may be certain reasons why a daycare termination letter from providers is warranted. Daycare termination letters for nonpayment or behavior are necessary tools for daycare centers to create the best possible environment for all the children at the center and good relationships between daycare workers and parents. 

Daycare is one of the most important services in the U.S. for busy parents. Throughout the country, an estimated 6.38 million working parents, around 58%, depend on daycare services — and daycare service providers. Parents need a place for their children to go for care and supervision while they work during the day. 

Daycares also provide much-needed socialization, enrichment and development for young children — 11 million working parents across the U.S. have children under the age of 3.

But if a situation in the dynamics of the daycare center warrants it, it can be in the daycare center's best interest to terminate their relationship with a client. 

For assistance with communication, check out our daycare letter to parents template.


Top Reasons for Terminating a Daycare Client 

Terminating a daycare client from your center may seem harsh. But if it isn't working out between you and a parent and their child, it may be necessary to terminate the relationship. There are many reasons why a daycare center might need to terminate a client from their daycare service, which we will explore here.  

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Late Tuition Payments 

Daycares may try to create a warm and loving family-type environment for the children in their care, but they are first and foremost businesses. A daycare center relies on monthly tuition payments to pay its bills. This includes supplies and paying daycare center workers.  

The average cost for childcare in 2020 was $10,174 per year. This increase in tuition is due to factors like inflation and the availability of licensed daycare centers and skilled daycare workers in a given area. 

Occasionally, circumstances can arise with families where they may be behind on a payment, but a family that makes a habit of consistently late or skipped payments isn't playing by the rules. Not only that, it hurts your ability to keep up with expenses and remain open. 

You can't keep bending the rules and playing nice with everyone if they're abusing the privilege. This type of situation requires a daycare service termination letter for nonpayment. 

Child Behavioral Issues 

Another top reason for daycare termination letters from providers is bad behavior. Because daycares are communal spaces, there are large groups of children in a shared space. This can create issues between children in the center in terms of socialization and cooperation. 

Sometimes a child is just not a good fit for a particular daycare setting. Frequent outbursts or destructive behaviors like hitting and biting are dangerous to the other children and should not be tolerated. Other issues like yelling and throwing toys or failure to follow the rules can create a poor environment for the other children.  

If you have given numerous warnings and made the parents aware of their child's behavior with little to no change over time, you should issue a care service termination letter for behavior. 

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Improper Parent Behavior 

Creating a safe environment for the children in your daycare is your first priority. You should also ensure you have a safe workplace for your daycare workers. Daycare worker turnover rates are skyrocketing, with an average turnover rate of 26-40% in licensed daycare facilities. 

If a parent repeatedly and unjustly engages in abusive behavior toward daycare center workers, it creates a toxic workplace environment. It's already hard enough finding qualified daycare center workers and contending with the aftereffects of the COVID-19 pandemic. You don't want to lose your staff because of an unreasonable and bullying parent. 

This also goes for difficult parents who may be bullying or fighting with other parents or their children. As a business, you have every right to terminate a parent who engages in unprofessional conduct. You should issue a daycare termination notice for improper parent behavior.  

Poor Hygiene Practices 

Daycare termination letters from providers protect your center's overall well-being. A parent who constantly brings their sick child to daycare regardless of sick child policies poses a danger to the children and staff of the center. 

As evidenced by the COVID-19 pandemic, viruses and other illnesses can spread quickly in close and shared quarters. Proper health protocols must be followed at all times to maintain health and safety. 

Children who are not properly potty trained by a certain age also create health and safety issues. They may wet or soil themselves throughout the day. Bacteria from fecal matter on shared surfaces can expose other children to serious illnesses as well. 

A child who has been exposed to lice can cause the infestation to spread to other children in the center and even force you to close down. Active cases of chickenpox or mumps can also spread quickly around the center. If a child in your daycare is a threat to your center's health and safety, you will need to terminate your relationship with the parent and child immediately. 

Inability to Meet Child's Needs 

While most issues for termination are for behavioral issues, poor hygiene or nonpayment, sometimes a daycare may have a child they can't properly care for. This may be because the child has developmental delays that put them too far behind their peers. 

Daycare centers need children who are roughly in the same developmental groups. This helps group activities and lessons flow at the proper pace. Although it's not the child's fault, a daycare center may not be able to give the child the care and attention they need, so they will need to go to another facility that is better suited to their needs.  

Other Issues 

Other issues may arise at your center that could require daycare termination letters from providers, including: 

  • Frequent late pick-ups of a child 
  • Lack of proper supplies for a child 
  • Badmouthing your business 

It’s up to you to decide on a case-by-case basis if these issues warrant the use of daycare termination letters, but this is an important step, especially if they violate your daycare center's Code of Conduct or contract. 



Know Your Termination Rights and Procedures 

You are well within your legal rights as a business to terminate service, especially if a parent or child is a threat to your center. You must provide written notice of termination to the parent stating the reasons for termination. You must also give two weeks' notice when you cancel a contract for daycare services. 

Be certain you have documentation of each occurrence of the issue. Keep your documentation clear and concise as to why this is a violation of daycare policies against a signed contract. Give the termination notice directly to the parent and remain firm if they start to yell or cry. Don't waffle or fold under pressure. 

As a daycare administrator, contact your local licenser to inform them of the family you terminated in case they try to discredit your center through a smear campaign. Explain the termination process you took and the reasons why you terminated services in your records. It is in your best interests to protect yourself from any potential backlash.


Understanding State Regulations

Overview of Relevant Laws

Each state has specific laws and standards for terminating a daycare contract. It’s important to understand your state’s laws and ensure that you are adhering to those laws before you take any action in the termination process. For example, the state of New York's laws specifically say that failure of a client to pay for daycare services constitutes a valid reason for termination.

Typically, parents are required to provide a notice period if they are terminating the agreement and removing their child from daycare and are responsible for payments through the end of that period. Daycare management can typically terminate a child care services agreement with a client for reasons including:

  • Non-compliance with daycare policies
  • Persistent disruptive behavior by the child
  • Non-payment or late payment of fees
  • Repeated failure to pick up the child on time
  • Failure to communicate absences
  • Inability to meet the child's needs without additional staff
  • Bringing a sick child to daycare
  • Consistent differences in child-rearing styles between the parent and provider

However, be sure to research and understand your state’s termination policies before taking any actions to terminate an agreement with a client.


Documenting the Termination Process

Documentation is vital in the termination process, which can become contentious and lead to legal action by either party as the process plays out. For that reason, documenting each action and step taken is a must.

Having a written record of your actions allows you to prove what steps you took and when, and to have a written explanation in the event either party pursues legal action. Even if a step in the process seems small and insignificant, keep a written record of it so you’re covered in the event the matter ends up in court.


Seeking Legal Advice

Some daycare contract disputes can escalate beyond conversations and meetings involving the daycare and the client. It’s important to recognize when these escalations reach a point where both parties need to consider legal assistance to resolve the matter.

When to Consult a Lawyer

  1. Wrongful termination claims: If a parent or guardian claims their child was wrongfully terminated from your daycare, consulting a lawyer can help determine if the termination violated any contractual terms or state regulations. 
  2. Contract disputes: If there is a dispute over the terms of the daycare contract, such as early termination clauses or notice periods, a lawyer can help interpret the contract and advise on the best course of action. 
  3. Allegations of child abuse or neglect: If a parent alleges that their child has been injured, abused or neglected at the daycare, it is essential to consult a lawyer. 
  4. Threats of legal action: If the parent or guardian provider is threatening to sue you over fees or other reasons, a lawyer can help you understand your legal position and prepare a defense. 
  5. Compliance with state regulations: Understanding state-specific regulations regarding daycare termination can be complex. A lawyer can help ensure that both you and the client are complying with all relevant laws and regulations.




Sample Templates for Daycare Termination Letters for Providers 

If you're looking for sample daycare termination letter templates for effective daycare withdrawal letters, review the examples below. There are different examples for each situation. 

Daycare Termination Letter 1 Nonpayment

Daycare Termination Letter Template for Late Tuition Payments

Families paying on time is one of the most important parts of a successful daycare business. While challenges arise for families, when clients consistently pay late, it creates issues for you. With this termination letter template, you can clearly explain the issue to the client and lay out the specific reasons and details for termination.



Dear [Name of Parent], 

This letter is to inform you of the termination of daycare services for your child, [Name of Child], due to nonpayment. You have repeatedly missed your monthly daycare payments, which is a violation of the contract you signed. While we understand everyone faces difficulties, we are still a business. 

As a result, [Name of Daycare] will no longer be able to provide daycare services for [Name of Child]. Effective two weeks from the receipt of this letter on [Date], your child is no longer in our care. 

Your remaining balance of $[Amount Owed] is still due to be paid in full at your contract's end. Failure to do so will result in further legal action to recoup back payments. 

We have enjoyed having [Name of Child] and hate to see them go, but we can no longer overlook this issue. 

Kind regards, 

[Name of Center Operator] 

Daycare Termination Letter 2 Nonpayment


To [Name of Parent], 

This letter serves as your two-week notice for the termination of daycare services for [Name of Child] at [Name of Daycare], effective immediately. Your account with our organization has been in bad standing for quite some time with no attempt to remedy the situation. 

All parents must pay the balance due on their accounts at the beginning of each month for services rendered as stated in our contract. Because you have made no attempt to correct this, we must terminate your daycare services on [Date of Termination].  

You still owe us a balance of $[Amount Owed], which must be received by the end of the day on your last day at our center or we will be forced to take further action to collect it. [Name of Child] will be missed, but we cannot continue to ignore this issue. 


[Name of Center Operator] 


Daycare Termination Letter Template for Child Behavioral Issues

Caring for children can be challenging at times, but when a child at your daycare is consistently disruptive and causes issues for staff and other students, you can be forced to take steps to remedy the problem. If a child is consistently unruly and their parent or guardian doesn’t make an effective effort to address the issue, it can become necessary to terminate their contract with your center. With this leaving daycare letter, you can provide your reasoning for the decision and follow the appropriate legal steps to end your relationship with the client.

Daycare Termination Letter 2 Behavior



To the parent(s) of [Name of Child], 

This letter is to inform you of the termination of daycare services at [Name of Daycare]. We have had multiple instances of [Name of Child]'s behavior becoming an issue at our center. We have spoken to you on multiple occasions regarding this behavior with no improvement.  

[Name of Child]'s behavior is affecting the welfare of the children and staff at our center, and we feel it is in the best interests of everyone at [Name of Daycare] that you seek daycare options for your child elsewhere. 

We are a community and everyone must follow the rules outlined in the Code of Conduct and contract you signed at the start of your child's time with us. Your services terminate two weeks from the date of this letter, on [Date of Termination]. 

We hope you have better success at another center.  


[Name of Center Operator] 



Dear [Mr./Mrs./Ms.] [Name of Parent],  

Your child [Name of Child] has been at [Name of Daycare] since [Date of First Visit] and while they are a bright and creative child, their behavior has become increasingly difficult to manage. 

Several times a day, [Name of Child] [describe behavior], which is not tolerated. They have also [describe behavior] despite being told not to multiple times. When put into time-out, [Name of Child] yells and disrupts the other children and refuses to sit still. 

These behaviors are cause for concern among daycare workers who are taking time away from the other children in an attempt to address [Name of Child]'s frequent outbursts. We do not feel well enough equipped to handle the needs of a child like [Name of Child] and are terminating daycare services on [Date of Termination]. 

We wish you luck in finding a new daycare center. 


[Name of Center Operator] 


Daycare Termination Letter Template for Improper Parent Behavior

Parents can also cause issue with their behavior toward staff, students and other parents at your daycare center. When parents are consistently rude, unruly, disrespectful or hostile and do not comply with directions from staff to alter their behavior, the problems they cause can force your daycare center to terminate their contract. Use this sample daycare termination letter template to communicate your decision and lay out the reasoning behind it.

Daycare Termination Letter 3 Parent Behavior


Dear [Name of Parent],  

It has come to our attention that you have been unnecessarily rude to the staff members at [Name of Daycare] on multiple occasions. Our staff works very hard to provide care and enrichment for all of the children at our center. We do not appreciate your rude comments and aggressive behavior toward our staff. 

We have also received several complaints that you have been rude to other parents on our campus. We strive to create a welcoming and friendly environment that you have chosen not to participate in. 

We do not tolerate bullying in any form with our children or our parents, as outlined in the Code of Conduct you signed with your contract. As a result, your child's daycare contract will terminate on [Date of Termination]. 


[Name of Center Operator] 


Daycare Termination Letter Template for Poor Hygiene Practices

It’s hugely important to maintain high hygiene standards at your daycare center. Given that preschoolers can be easily affected by various illnesses and germs and don’t have the same awareness of proper hygiene practices that older children tend to have, they and their parents need to consistently comply with your rules and policies. If a child fails to do so over an extended period of time and in spite of repeated warnings to their parent or guardian, use this termination letter template to effectively end your relationship with them.

Daycare Termination Letter - Medical Noncompliance


To the Parent(s) of [Name of Child], 

Your child has been brought to [Name of Daycare] sick on multiple occasions. While we understand your need to work, we have health and safety protocols in place for a reason to protect the other children and staff members at our center. 

Because you and your child refuse to participate in the hygiene rules detailed in our Code of Conduct, we have made the difficult decision to terminate your child's daycare contract effective on [Date of Termination]. 

We value the health and safety of the children and daycare workers at [Name of Daycare] and want the best experience for everyone. A sick child's illness can spread quickly to others in a shared communal space and create a health crisis that will require us to close the center. It is in everyone's best interest that you seek alternative daycare options for [Name of Child] elsewhere. 


[Name of Center Operator] 


Daycare Termination Letter Template for Inability to Meet a Child's Needs

Certain children have specific care needs that go beyond the norm and beyond your daycare center’s capabilities. While it would be great to be able to provide that elevated level of care for any child who needs it, sometimes a child’s mental or behavioral issues necessitate your center making the difficult decision to terminate the relationship so they and their family can find that elevated level of care at a facility better suited for it. In these situations, the following template can be a guide to effectively communicating the message.

Daycare Termination Letter - Medical Noncompliance


To the Parent(s) of [Name of Child], 

Dear [Parent’s Name],

I hope this letter finds you well. I'm writing to inform you that, after careful consideration, we have determined that we are unable to continue providing daycare services for your child, [Child’s Full Name], effective [Termination Date].

This decision has not been made lightly. We have observed that [Child’s Name] requires specialized care and attention that exceeds the resources and capabilities of our facility. Our primary concern is to ensure that [Child’s Name] receives the best possible care and support, which we believe can be better provided in an environment specifically equipped to meet their unique needs.

We understand that this may be a challenging transition for you and your family. To assist you during this period, we are providing a list of local daycare centers and specialists who may be better suited to accommodate [Child’s Name]’s needs. We are also available to discuss any questions or concerns you may have and to help facilitate a smooth transition.

Please know that this decision is in no way a reflection of [Child’s Name] or your family. We have truly enjoyed having [Child’s Name] with us and will miss their presence at our daycare.

Thank you for your understanding and cooperation. If you have any questions or need further assistance, please do not hesitate to contact me at [Your Phone Number] or [Your Email Address].


[Name of Center Operator] 


For more helpful resources, check out this free preschool and daycare teacher contract template.

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What should be included in a termination letter?

Here are the essential elements that should be included in a daycare termination letter:

  1. Date: Clearly state the date when the letter is written.
  2. Recipient's information: Address the letter to the appropriate party (either the daycare provider or the parents).
  3. Child’s full name: Include the full name of the child whose services are being terminated.
  4. Termination date: Specify the exact date when the daycare services will end.
  5. Reason for termination: Provide a brief and respectful explanation for the termination. This could include reasons such as relocation, financial constraints, behavioral issues, or other relevant factors.
  6. Acknowledgment and gratitude: Thank the daycare provider or parents for their cooperation and the time spent together.
  7. Contact information: Include your contact details in case there are any questions or further discussions needed.
  8. Signature: Sign the letter to authenticate it.


How much notice should be given for termination?

The recommended notice period for daycare termination typically ranges from two weeks to 30 days. Keep these points in mind regarding notice periods:

  • Two-week notice: Many daycare providers require a minimum two-week notice for termination of services. This applies to both parents voluntarily withdrawing their child and providers terminating care.
  • Provider-specific policies: Your daycare may have a longer or shorter notice period specified in its contract.
  • State regulations: Some states have specific requirements for termination notices. Research to find your state’s regulations.


Can termination be immediate?

Yes. In certain situations, such as policy violations, non-payment, or safety concerns, daycare providers may reserve the right to terminate services immediately without the standard notice period.


How should termination letters be delivered?

Choose one of the three options that best fits your situation and business: in-person, email or certified mail. The best option depends on your business, each individual client and the details of the situation. Evaluate each of these factors, consult with staff and, if necessary, an attorney, before making a final determination on the right delivery method.

Are there legal implications for terminating care?

There are potential legal implications of terminating daycare services, so be sure to keep these important factors in mind:

  1. Discrimination laws: Daycare providers must ensure termination decisions do not violate anti-discrimination laws based on protected characteristics like race, religion, or disability.
  2. Licensing regulations: Daycare providers must comply with state licensing regulations regarding termination procedures. Violations could lead to regulatory penalties or license revocation.
  3. Child welfare concerns: If termination is due to suspected abuse or neglect, providers have legal obligations to report to child protective services.
  4. Wrongful termination: Parents may have grounds for legal action if termination violates contract terms or state regulations.
  5. Refund policies: Disputes over refunds for prepaid services or deposits may have legal implications.
  6. Confidentiality: Both parties should be aware of legal obligations regarding confidentiality of information after termination.


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