Death is a Company Policy - S5-E1
Continuity mistake: The Five-O computer here lists McGarrett's name as Steven J. McGarrett. But in "A Gun for McGarrett," his middle name is revealed to be Aloysius. Strange that the computer doesn't know the name of its own department's head.
Answer: He was fired. He never really appreciated his character. He felt Kono was portrayed as a big dumb Hawaiian and that the stereotype was racist. He also felt underutilized. He was fired after a heated argument with the show's publicist regarding his character. It seems there's not much details given regarding the incident or the firing, so it's seems possible he upset the show's producers as well.
Bishop73
No he said something derogatory about one of the Jewish producers that's why he was fired.