Your Pokémon's status is meant to help others working with your team figure out if a Pokémon who would be around for a current task, as well as allowing for tracking of former teammates who may have appeared in past submissions to still show up in searches for that Pokémon.
You may set this status to anything you like such as "Retired", "Deceased", "Missing in Action", or anything else. Do note however, that if a team member isn't set to "Active", they will appear grayed out on your team's page. If a Pokémon will no longer be on your team, adjust their status accordingly. Don't delete them!
You can also delete pokémon or an entire team. These options are hidden by default to prevent accidental removal. I need to delete a pokémon/team