July 14, 2026
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Prince Edward Island has introduced one of the most significant updates to its employment legislation in recent years. Effective June 30, 2026, the new Employment Standards Act modernizes several workplace rules affecting vacation entitlements, hours of work, leave provisions, termination requirements, and employer obligations.
While not every change will impact every organization, employers should take this opportunity to review their employment policies, payroll practices, scheduling procedures, and employee documentation to ensure they remain compliant.
Employees are now entitled to three weeks of annual vacation after five years of continuous employment, reduced from the previous eight-year requirement. The legislation also provides greater clarity around vacation entitlements for part-time, seasonal, and short-term employees. Additionally, pay statements must now separately identify paid holiday pay and pay for any paid leave.
Several changes have been introduced to support more predictable scheduling and clearer overtime practices.
The standard maximum work week has been reduced from 48 hours to 44 hours, although exceptions continue to apply for certain industries. Employers and employees may also enter into written overtime averaging agreements, allowing overtime to be calculated over a two- to four-week period.
The Act also introduces several new scheduling requirements, including:
The new legislation introduces several changes to employee leave provisions.
Employees may now take up to 27 weeks of unpaid, job-protected medical leave for qualifying medical situations, including recovery from illness or injury, organ or tissue donation, gender-affirming care, and other approved medical procedures.
Employees are now entitled to four unpaid sick days per year after completing 30 days of employment.
The rules surrounding medical documentation have also changed. Employers may only request a sick note after an employee has been absent for five or more consecutive days, and documentation may now be provided by a broader range of licensed healthcare professionals when appropriate. These provisions now also apply to unionized employees.
A new unpaid leave has also been introduced, allowing employees who have completed 90 days of employment to take one unpaid day off to attend their Canadian citizenship ceremony.
The Act reduces the period before employees become entitled to statutory notice of termination.
Employees now qualify for notice after 90 days of employment, replacing the previous six-month threshold.
New group termination provisions have also been introduced. Employers must provide at least six weeks’ notice when:
The required notice must be provided to affected employees, any applicable union, and the Government of Prince Edward Island.
The legislation also expands enforcement provisions.
The time limit for filing an Employment Standards complaint has increased from one year to two years, and Employment Standards inspectors now have the authority to issue fines when employers fail to comply with the legislation.
These changes reinforce the importance of maintaining accurate employment records and ensuring workplace policies remain current.
Legislative changes often require more than simply updating an employee handbook. They can affect payroll settings, scheduling practices, employment agreements, manager training, and employee records.
Prince Edward Island employers should consider taking the following steps:
Taking a proactive approach today can help reduce compliance risk while creating greater consistency across the organization.
Legislative updates don’t just require policy changes; they require organizations to communicate those changes effectively, maintain accurate records, and ensure managers are following consistent processes.
DriveHRIS helps employers simplify compliance by centralizing employee records, distributing updated policies with electronic acknowledgements, tracking employee service dates and vacation entitlements, managing schedules and time records, and providing leaders with greater visibility into workforce activities.
When policies, employee information, and compliance records are managed in one place, organizations are better equipped to respond to legislative changes with confidence and consistency.
Human Resources & H&S Advisor - Eastern Canada
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