If you want to go into the philosophical meaning of this phrase, that is outside of the realm of this exchange, and might be better on English, as this is a Camus novel and has so many layers to it.
In this specific case, he is saying that "Tolerance" must, "give way" to "Justice".
That means that in this case, it is more important for the murderer to be punished, than for us to feel sympathy for him, because of the societal consequences.
"Giving way" here means to "get out of the way". Imagine you come to a narrow corridor and someone is trying to get past you. If you let them past you are "giving way". So in this case it means that tolerance must get out of justice's way, as justice takes precedence.
"Sterner" can be simply understood as "meaner". It is pretty easy to see why "justice" is a less pleasant thing than tolerance. Tolerance is love and happiness, people getting on together. Justice is punishment, harshness, absolutes.
In classical literature, and in most Western societies, "Justice" is held in high esteem as a moral principle. Most people at this time would have considered it more important for a society to be "just" than "tolerant". In this case your definition is fine, as the character is indeed saying that Justice deserves more praise and esteem than Tolerance.