The New Zealander, who was contracted until the end of the Natwest t20 Blast group stage, flew home on Saturday as a result of injury.
Butler hasn’t appeared in the past few games and as he would not have been available for the final four Twenty20 outings, the decision was taken to let him go.
Chief executive David Smith commented: “It’s a shame but there was no point in Ian hanging around if he wasn’t going to be playing.
“His contract was due to end in two weeks anyway and we thought it was for the best.
“Ian’s contributed well while with us and what has happened sums up our luck with overseas players this season and the significant issues that we’ve had.”