Time In Lieu In The Workplace (TOIL) Explained

Bryan Brown | 23 August 2022 | 2 years ago

Time In Lieu In The Workplace (TOIL) Explained

TOIL is a workplace term for leave that employees can accrue by working overtime, without using up their annual leave allowance. In this article, we’ll explain what TOIL is and how it works for both employers and employees in more detail.

What Is Time Off In Lieu?

When employees work extra hours, employees can choose to pay them for their time, offer time off in lieu, or have no compensation at all.

If employers choose to reward employees working extra hours with time off in lieu (known as TOIL), this means that instead of being paid for their overtime, they are given an equivalent amount of free time back at a later date.

For example, if an employee works two extra hours, over and above their contracted hours, they would be given two hours of TOIL to take off at a convenient time. Each employer is free to set the conditions surrounding the implementation of TOIL policies and procedures in their organisation.

When Can TOIL Be Used?

TOIL can be used to cover a range of situations, including working overtime, working on public holidays, and taking leave without pay. How TOIL is used is at the discretion of employers, so some employers will have strict rules about how and when TOIL must be taken, while others give their employees more flexibility.

Either way, TOIL is a beneficial perk that allows employees to enjoy some extra free time away from work, and gives employers to boost manpower during busy times without needing to make overtime payments.

How Does TOIL Work?

TOIL works by employees accruing extra hours which they can then take off at a later date, rather than being paid for them as an overtime payment. For example, if an employee works an extra hour each day Monday to Friday, they will have accrued 5 extra hours by the end of the week. These extra hours can then be taken off at a later date or converted into annual leave.

Employers should keep track of employees’ TOIL hours using a timesheet or similar system. Employees should also be aware of how many TOIL hours they have accrued so that they can take them when they need to.

If you’re an employer, you can offer TOIL to your employees as an entitlement in their contract of employment. Alternatively, you can offer it as an informal arrangement. If you do offer TOIL informally, make sure that you keep track of employees’ hours using a timesheet or similar system.

If you’re an employee, you can start accruing TOIL hours by working overtime. Make sure to keep track of your TOIL hours so that you can take them off at a later date. You should also check your contract of employment to see if your employer offers TOIL as an entitlement.

Why Is TOIL Needed?


Life is busy and the need for a healthy work-life balance has never been more prominent to prevent employee burnout that can arise from working long hours day after day. Overworked employees can make mistakes, need to take time off due to ill health or fatigue, and can contribute to high staff turnover rates – all of which employers want to avoid if possible.

An effective TOIL policy in the workplace can help to provide a good balance for employers and employees. It will allow employers to get more hands-on deck when work needs to get done during busy periods for example, but not at the detriment to employees’ health or home life commitments, as workers can reclaim the time worked back at a later date.

Is TOIL Regulated By Employment Law?

There is no legal requirement for employers to offer TOIL but many employers do so as a way of enticing employees to work extra hours. If an employer does offer TOIL, they must make sure that it is clearly stated in the employee’s contract of employment and ensure it is managed fairly and reasonably.

For example, an employer cannot force an employee to take TOIL instead of being paid for overtime. If you have any questions about TOIL or other aspects of employment law, you should speak to a solicitor experienced in employment law.

Including TOIL In Employment Contracts

Since it’s up to each company to agree to its policy on taking time off in lieu, it’s really important that when employers choose to offer this benefit, they make sure that it’s properly covered in employee contracts and workplace policies.

A clear outline of the rules and procedures to follow relating to TOIL will ensure that both employer and employee know where they stand. It should be made clear where employees can find this information if needed, usually within a staff handbook or policy library that is centrally accessed.

If TOIL is an option in your workplace, you should check that employment contracts or TOIL policies include the following information.

  • Whether employees are given time off instead of being paid for overtime
  • A detailed explanation of how the TOIL scheme works including the minimum amount of time that can be worked to accrue TOIL, monthly allowances or limits, when it can be taken, or when it’s lost if not taken soon enough.
  • How TOIL records should be kept and where they can be accessed
  • What happens to TOIL that has been accrued when a contract is terminated or an employee resigns.

TOIL vs. Paid Overtime

There is always a debate on how employees should handle additional hours worked. On the one hand, paying employees for overtime hours ensures that they are compensated fairly for the work that they have done, but on the other hand TOIL allows employees to have more flexible schedules and maintain a better work-life balance.

Additional payment can be important for workers who are on low wages which could do with the additional income. For those who prefer to take TOIL, this can lead to lower levels of stress and absenteeism, and it can also increase employee satisfaction and productivity.

Whilst both TOIL and paid overtime have their pros and cons for both employers and workers, ultimately, the decision of whether to pay employees for overtime hours or give them TOIL should be based on the specific needs of the organisation.

There is no one-size-fits-all solution; what works for one company may not work for another. The most important thing is to make sure that employees are happy and productive in their work environment and don’t feel under pressure to work more than their contracted hours.

What Are The Benefits Of TOIL?

There are a few key benefits of TOIL for both employers and employees:

  • Employees can use TOIL to take extra time off, without using up their annual leave allowance. This means that they can save their annual leave for when they need it, such as for taking holidays.
  • TOIL can provide greater flexibility in terms of work-life balance. Employees can choose to take time off when it suits them, rather than being forced to work excessive hours. This can be especially beneficial for those with young children or other family commitments.
  • TOIL can be used to cover unexpected absences, such as sick days or doctor’s appointments. This can help to reduce stress levels and improve productivity.
  • Employers can use TOIL to manage employee workloads, by giving employees extra time off when they are particularly busy.
  • TOIL hours can usually be carried over from one year to the next, giving employees a valuable buffer to use in case of emergencies but cut-off dates to use allowances are at the employers’ discretion. Some employers for example specify that TOIL must be taken the month directly after it was accumulated.
  • TOIL can be used to reward employees who regularly work overtime.

What Are The Disadvantages Of TOIL?

There are a few potential disadvantages of TOIL to consider:

  • Employees may feel pressured to work overtime to accrue TOIL hours to get the time off that they want.
  • Employees may feel that they are not being paid fairly for their overtime work if they are not being paid extra, but are only receiving TOIL hours.
  • If employees bank excessive TOIL hours, employers can find themselves short of cover if taken all at once.
  • If an employee leaves their job, they will usually lose any TOIL hours that they have accrued.
  • TOIL is not a guaranteed entitlement and employers can unilaterally change or cancel TOIL arrangements at any time. As such, employees should be cautious about relying on TOIL as a means of balancing their work and personal life.

How To Calculate Time Off In Lieu?

Calculate time off in lieu

The process for accruing time off in lieu (TOIL), recording it, and taking it will vary between organisations but this simple step-by-step guide will give you an overview of how to calculate allowances.

1) Determine the eligible hours that an employee has worked. This will typically be any hours that are above and beyond their normal work week that fall within your organisation’s TOIL thresholds. For example, if an employee is contracted to work 20 hours in a given week but has clocked up 30 hours, this would equal 10 hours of TOIL hours.

2) Depending on your workplace’s policy, any eligible hours submitted as TOIL, will probably need to be approved by a manager either written or verbally. It’s important to be clear on exactly what counts as additional working hours. Sometimes workers may decide to skip a lunch break or come in early without being asked to try and rack up as much additional time as possible. This is rarely healthy or suitable for most employers, so it is important therefore that employers control this process by clearly stating the parameters of overtime and what will and won’t be counted.

3) After the hours have been approved, the employee should agree with their line manager when they can take time off at a later date, or receive payment for their TOIL hours. If the employee chooses to take time off, they should work with their employer to determine an appropriate time frame.

How To Record TOIL

The best way to record TOIL hours is by using a timesheet or tracking app. How your time off in lieu is recorded will largely depend on your employers’ preference and how tech-savvy they are.

Most modern, digitally centred organisations will have some kind of employee app, intranet or software that gives employees a login to record things such as expenses, annual leave or overtime worked. Others will still prefer the good old-fashioned pen and paper timesheet or spreadsheet approach, and sometimes a clocking system is used to automatically record employees’ hours when arriving and leaving work.

Regardless of where your toil is logged, the important information to keep track of is:

  • The dates your worked additional hours
  • The number of additional hours worked including start and finish times
  • An overview of time off owed categorised by type (annual leave, TOIL)
Keeping accurate records of TOIL hours and being able to process them efficiently is essential for ensuring that employees receive credit for their hard work and that employees are fairly compensated workers for their efforts.

When Should Employees Take Their Time Off In Lieu?

It’s all very well and good accruing time off, but if employees can’t or don’t take their time off then it defeats the purpose of this benefit.

There are a few different ways that employers can approach this. Some might choose to be more lenient and let employees take their TOIL hours whenever they like, providing it doesn’t interfere with work commitments. Others may prefer to be more strict and set specific dates or times when TOIL can be taken.

The best way to manage this will depend on the workplace and what works best for employees and employers. The main thing to keep in mind is that TOIL is meant to be a tool for preventing burnout and promoting a healthy work-life balance, so employees must be allowed to take their TOIL hours in a way that doesn’t adversely affect their well-being.


TOIL is a system that allows employees to claim time off for extra hours worked, over and above their normal working week. TOIL hours banked will usually be approved by a manager and should be recorded in a timesheet or tracking app so employers and employees can keep track of time owing. There is no legal requirement to offer TOIL, so the way it is managed is up to an employer, but they must ensure it is a fair and reasonable system.



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