Dear …
As you know, our organization has been undergoing some major restructuring in the last __(# weeks/months)__. We had been hoping during this difficult period of reorganization that we would be able to keep all of our existing employees. Unfortunately, this is not the case.
And so it is with great regret, that I must inform you we will no longer be able to utilize your services effective __(date)__. I want you to know that we have been pleased with the quality of your work during your tenure of employment with us, and we will be sorry to lose you as an employee. This is a difficult time for us all.
We will certainly give you a good reference to assist you with your career transition. Please accept our thanks for your past service and best wishes for your future.
Yours truly,