Every year since he started the laziness starts in? The first year this happened he should've been spoken with (verbal warning). If you noticed this behavior setting in the second year right at that moment he should've been taken aside and the initial conversation revisited. Such as it is, you've acquiesced to this and it's become the accepted norm. As KellyG stated warning without consequences equal nothing.
Let's deal with the here and now; take him aside at the time you are going to lay him off (thus avoiding the potential for a faux fall and WC claim). You may want to go down this line of thought, "For the past 8 yrs you've worked with me I've seen a consistent pattern. (Start with the positive, i.e., his enthusiasm, if any, at the beginning of the year) You start off really strong but by October you seem to be running on empty. While I've talked to you about this before, I feel it just doesn't make a difference and I'm frustrated. I've allowed it to continue in the hopes that you would heed me and change. My not doing anything about this is my mistake. It doesn't help you or me. What do you think is behind this for you?"
Let him tell you what is going on in his head. Ask open-ended questions (not questions that only need a yes or no answer). Listen, actively to his answer and think about what it implies for the business and yourself. Go on to say, you've been doing some thinking on this as well and feel that you need to seriously consider where the company is going in the coming years and how his behavior is going to impact that. You would like him to also take time to consider his future options, where he wants to go in the next few years, what he's willing and able to do to accomplish his goals and what steps he'll be taking to improve his performance. Give him a time frame of say a month or two before the two of you meet to discuss what he's come up with. Let him know in that time you will also be making some decisions on what your expectations will be of him. Let him know you'll be available to answer any questions that may arise during the time prior to the meeting.
I would conclude by telling him that the status quo is not an option and that changes need to be made going into the next season.
After 8 yrs of doing essentially nothing it's not so easy just to dump him. There are the labor laws that govern your jurisdiction that need to be taken into account and whether or not you would owe him any sort of severance or notice, etc... Having kept him for that long I would draw the conclusion that he has some redeeming qualities and that there is a bond that exists (healthy or otherwise). Cutting him loose would, without some sort of dialogue, only leave a bad taste in both your mouths.
Let us know what you do.
