In a statement released on Monday [NZT], the Hurricanes said that due to the financial uncertainty created by Covid-19, they have agreed Spencer will finish his contract early.
"This means he will not be part of the Hurricanes coaching team for the remainder of Investec Super Rugby Aotearoa," the Hurricanes said.
"We would like to thank Carlos for his significant contribution to the Hurricanes and wish him all the best for the future."
The 44 year-old signed on as Hurricanes assistant coach at the start of the 2019 season, having returned to New Zealand from coaching stints in South Africa and Japan.
Spencer broke onto the New Zealand rugby scene in the Hurricanes region, with Horowhenua, helping the side to win the then third division championship title for the first time, and was soon signed by Auckland towards the end of their great Ranfurly Shield era. From there he was selected for the All Blacks.