Eastern Health says it was served a stop work order at Access House by the provincial government's occupational health and safety branch, which has meant temporarily relocating people at the six-bed home.
The health authority says the stop work order was issued because staff members were working alone in high-risk situations without the appropriate training.
It says a plan has been put in place to address staff and client safety while Access House is temporarily closed.
Access House offers programs for patients who have been discharged from the Waterford Hospital in the city.
There were five people living at the 30-year-old facility, which employs nine staff members.