I am not sure if you have a counselling with that employee. If not I think it will be a good idea to have a discussion with him and find out the reason behind this kind of behaviour.
Termination should be the last option, if the counselling is not fruitful, then you should force him to resign, and release him immediately. This way he will get a clean chit release letter.
The employee with this kind of behaviour are the bad fish and should not be given more time to spend in the organisation as they will spoil the environment further. If he is not ready to resign, then terminate his services on grounds mentioned without any notice period with one month of salary in lieu of that.
Hope it helps.