How to Terminate Employees in Nova Scotia: Guidance for Employers

Employment termination is a regular part of managing a business. Whether due to performance issues, restructuring, or lack of work, ending an employee's job requires following specific legal steps.

In Nova Scotia, the rules for terminating employment are outlined in provincial law. These rules define how much notice an employee must receive, when pay in lieu of notice applies, and what qualifies as a fair dismissal.

Understanding these rules will help employers stay compliant with local legislation. It also reduces the risk of legal issues after a termination takes place.

Understanding the legal framework in Nova Scotia

The Nova Scotia Labour Standards Code sets clear rules for notice periods, termination pay, and proper procedures. Understanding these requirements helps employers handle terminations legally and professionally.

Most employees in Nova Scotia work in provincially regulated industries covered by the Labour Standards Code. While some work in federally regulated sectors like banking or telecommunications, which follow different rules under the Canada Labour Code.

Notice periods under the Nova Scotia Labour Standards Code

The Nova Scotia Labour Standards Code establishes minimum notice periods based on how long an employee has worked for the same employer. These are legal minimums that cannot be reduced through employment contracts or agreements.

Less than three months: No notice required. Employers can terminate employment immediately during this probationary period.

Three months or more but  less than two years: One week's written notice or pay in lieu of notice.

Two years or more but less than five years: Two weeks' notice or equivalent pay.

Five years or more but  less than ten years: Four weeks' notice or pay in lieu.

Ten years or more: Eight weeks' notice plus the requirement for just cause to terminate.

Pay in lieu of notice means providing a lump sum payment equal to what the employee would earn during the notice period instead of having them work through it.

When is notice of termination not required?

The Labour Standards Code allows immediate termination without notice or pay in specific situations:

• Wilful misconduct: Intentional wrongdoing like theft, violence, or serious insubordination
• Probationary period: Employees with less than three months of service
• Temporary contracts: Seasonal or casual workers hired for defined terms under 12 months
• Sudden work shortage: Unexpected circumstances beyond the employer's control (for e.g., an explosion in the workplace)
• Refusal of reasonable alternative work: When suitable alternative employment is offered but declined
• When an employee has reached the age of retirement based on a bona fide occupational requirement (for most jobs, mandatory retirement is not allowed)
• When a person is laid off or suspended for 6 days or less.

For wilful misconduct, employers carry the burden of proving the employee's actions were serious enough to justify immediate termination. Simple performance issues or minor policy violations typically don't meet this standard.

Understanding just cause for termination

Just cause represents the highest standard for termination, allowing employers to dismiss employees immediately without notice or pay. The legal threshold is deliberately high, requiring clear evidence of serious misconduct that fundamentally damages the employment relationship.

Common examples of just cause include:

• Theft or fraud: Taking company property or falsifying records
• Violence or threats: Physical altercations or serious harassment
• Serious insubordination: Deliberately refusing lawful, reasonable instructions
• Gross neglect of duty: Repeated failure to perform essential job functions despite warnings

Employers typically demonstrate progressive discipline before claiming just cause, showing they attempted to address issues through warnings and improvement opportunities. Single incidents rarely constitute just cause unless they involve serious safety violations or criminal behavior.

Pay in lieu of notice and final payments

When terminating employment, employers must calculate all amounts owed to the employee. This includes regular wages, overtime, vacation pay, and any earned bonuses or commissions up to the termination date.

Final payment components:

• Regular wages: All hours worked through the last day
• Vacation pay: Accrued but unused vacation time from current and previous years
• Statutory holiday pay: Earned holidays not yet paid
• Benefits continuation: Health and dental coverage may continue during the notice period

The Record of Employment (ROE) goes to Service Canada within five days of termination or final payment. This document enables the former employee to apply for Employment Insurance benefits.

Special rules for long-term employees

Employees with ten or more years of service receive additional protection under the Nova Scotia Labour Standards Code. Employers cannot terminate or suspend these employees without just cause, meaning a valid, serious reason related to conduct or performance.

This protection creates higher legal risk for employers. If termination occurs without proper justification, the Labour Standards Division can order reinstatement with full back pay or additional compensation beyond the standard eight-week notice period.

Exceptions exist for legitimate business reasons like position elimination or sudden lack of work, but employers bear the responsibility of demonstrating good faith in these decisions.

Group termination requirements

When terminating ten or more employees within four weeks, additional requirements apply:

Extended notice periods:

• 10 to 99 employees: 8 weeks
• 100 to 299 employees: 12 weeks
• 300+ employees: 16 weeks

Additional obligations:

The employer must provide a written notice to the Minister of Labour, Skills and Immigration, which includes the following details:

• the name and address of the company laying off employees
• the reason employees are being laid off
• the number of employees being laid off
• if more than one location of the business is affected, the number of employees being laid off at each location and the address of each location
• the date written notice is being given to employees
• the date employees’ employment is ending
• the number of weeks’ notice and/or pay in lieu of notice being given to employees
• contact information for an individual who the Department of Labour, Skills and Immigration can get in touch with if more information about the lay off is needed

Termination documentation and process

Proper documentation protects employers from wrongful dismissal claims and demonstrates fair treatment. Essential records include performance reviews, progressive discipline actions, improvement plans, and any warnings provided to the employee.

Key termination documents:

• Termination letter: Written notice stating the last day of work and reason (if for cause)
• Statement of benefits: Breakdown of all final payments and benefit continuations
• Exit checklist: Tracking return of company property and system access removal

The termination meeting requires careful handling. Choose a private location, deliver the decision clearly and respectfully, provide written documentation, collect company property, and explain next steps including final payment timing.

Minimizing legal risk

Employment contracts can limit notice entitlements to statutory minimums, provided they meet legal requirements and don't violate the Labour Standards Code. Well-drafted contracts clarify termination procedures and reduce ambiguity.

Progressive discipline creates a documented trail of performance issues and improvement attempts. This process typically moves from verbal warnings to written warnings, suspension, and finally termination, with each step documented and communicated clearly.

Common termination mistakes to avoid:

• Misclassifying employees as independent contractors
• Ending benefits before the notice period expires
• Ignoring human rights accommodation duties
• Insufficient documentation of performance issues

Need support developing the right HR documentation for terminations?

Peninsula provides guidance on employee terminations, employment contracts, and compliance with Nova Scotia employment standards. Our certified HR advisors help employers navigate complex termination situations while minimizing legal risk.

For immediate assistance with termination procedures or HR compliance, call a Peninsula expert today at (1) 833 247-3652.