A post-termination restrictive covenant for non-competition restricts an employee from joining the employer's competitor or conducting business in competition with the employer following termination of employment. The employee is usually required to provide such a covenant on being hired, making it difficult for the employee to decline. As the legality of such a covenant was controversial, when the Labour Standards Act was revised in 2016, a new article was added to regulate it.
An employer may terminate an employment contract with notice or payment in lieu of notice and provide the appropriate severance payment if an employee is confirmed to be incompetent to perform the work assigned to him or her. However, employers may not terminate an employment contract if the employee is on maternity leave or suffering from an occupational injury or disease while working for the employer.