TOIL meaning: what time off in lieu is in the UK, what the law says, how to set the policy and track it

What time off in lieu is

Time off in lieu, TOIL, is time off given instead of pay for hours worked beyond the contracted hours. Someone stays two hours late for a stocktake on Tuesday and leaves two hours early the following Friday. The extra hours go into a balance; the balance is drawn down as time off.

It is common in charities, the public sector, offices and small businesses where paying overtime is not in the budget, and in any team where the workload comes in waves.

What the law says (and does not)

There is no statutory right to TOIL, and no statutory right to overtime pay either. Acas puts it plainly: there is no automatic legal right to overtime pay, though the hourly rate must not fall below the National Minimum Wage. TOIL is whatever the contract, a written policy or a collective agreement says it is. If the contract says extra hours are unpaid and there is no TOIL policy, there is no TOIL.

Four legal points still apply around it:

1. Minimum wage. Total pay for the pay reference period divided by the hours actually worked must not fall below the National Minimum Wage (£12.71 an hour for 21 and over from April 2026). A lot of unpaid extra hours in a month, with the TOIL taken months later, can push a low-paid worker under the floor for that month. Check it for anyone near the minimum.
2. The 48-hour average. Hours worked are working time whether they are paid, banked or neither. TOIL does not stop them counting towards the 48-hour average over 17 weeks under the Working Time Regulations, and the 11 hours of rest between shifts still apply on the long day.
3. Holiday is separate. TOIL is not annual leave. The 5.6 weeks of statutory holiday are owed in full regardless of any TOIL balance, and TOIL cannot be used to reduce them. Taking TOIL does not use up holiday; taking holiday does not use up TOIL.
4. Records. If it is in the contract, an unpaid TOIL balance at the end of employment is owed one way or another. Whether it is paid out depends on what the policy says; if the policy is silent, expect a dispute.

Lieu day: a day off instead of a day worked

A lieu day (a day in lieu, or a day off in lieu) is TOIL measured in whole days rather than hours. It usually comes from one of three things: working a bank holiday, working a rostered day off to cover an absence, or a contract that gives a day off when a bank holiday falls on a non-working day. For part-timers, the last one is a fairness question: someone who never works Mondays gets no benefit from Monday bank holidays, so many employers give part-time staff a pro rata allowance of bank holiday leave, taken as lieu days.

There is no statutory right to a lieu day for working a bank holiday, and no statutory premium either; bank holidays can be included in the 5.6 weeks of holiday. What you owe is what the contract says. The same rules as TOIL apply: agree it before the day is worked, write it in the rota as an absence when it is taken, and decide when it expires.

TOIL, overtime pay, and a shift allowance

Three different things that get muddled:

• Overtime pay is money for extra hours, at whatever rate the contract sets (there is no legal premium in the UK).
• A shift allowance is money for when the hours fall, such as nights or Sundays, regardless of how many.
• TOIL is time, not money, for extra hours.

A policy can combine them: TOIL at 1:1 for extra daytime hours, paid at the night rate for extra hours after 10pm. What matters is that each hour is compensated one way, and that the rota can tell which.

The policy decisions

Rate. Most schemes give one hour off per extra hour worked (1:1). Some give more for weekends or bank holidays. Write down which hours earn which rate.

Who approves the extra hours. TOIL works when the extra time is agreed before it is worked, or at least on the day. Balances built up silently over months, then presented as six days off in December, are how the scheme collapses.

Cap on the balance. A maximum, for example 15 hours or two working days, after which no more accrues until some is taken. Without one, balances grow until they cannot be honoured.

Expiry. Take it within a set period, or it is paid out or lost, whichever the policy says. Losing TOIL is lawful if the policy is clear and the worker had a real opportunity to take it; in practice, making people lose time they worked costs more in goodwill than the hours were worth.

Granularity. Can it be taken in half hours, half days or only full days? Half days keep the rota workable.

Leaving. Paid out, or taken during notice. Decide it now, not at the exit interview.

Part-time staff. Under the Part-time Workers Regulations, a part-time worker must not be treated less favourably than a comparable full-timer. A scheme that gives TOIL to full-timers but nothing to part-timers for the same extra hours needs a justification.

Worked example

Tom is contracted 30 hours a week, 1:1 TOIL, balance capped at 15 hours, use within 8 weeks.

Week	Rota	Worked	TOIL earned	TOIL taken	Balance
1	30 h	34 h (stocktake)	4 h	0	4 h
2	30 h	30 h	0	0	4 h
3	30 h	37 h (colleague off sick)	7 h	0	11 h
4	26 h	26 h (left early twice)	0	4 h	7 h
5	30 h	30 h	0	0	7 h
6	23 h	23 h (one day off in lieu)	0	7 h	0

Week 3 is the one to watch: 37 hours is fine for the 48-hour average, and the two long days each need the 20-minute break and 11 hours' rest before the next shift. In weeks 4 and 6 the rota was written short on purpose, so the time off was planned and covered, not squeezed in. The week 1 hours were cleared inside the 8-week window.

Tracking it without a spreadsheet nobody trusts

TOIL fails on arithmetic, not on principle. It needs, per person: contracted hours, hours actually worked, the difference, and time taken, week by week, visible to the worker and the manager. That is an hours bank.

Squadra's hours bank does this: the rota holds the contracted hours, clock-in records the hours worked, the balance updates on its own, and the worker sees it on their phone. The manager writes the time off into the rota the way any other absence is written, so the day is covered. If you would rather keep a file, the free rota templates give the weekly totals per person to start from, and the hours bank calculator covers the balance logic.

Related: the Working Time Regulations and your rota for the limits the extra hours still have to respect, and zero hours contract holiday pay for staff whose hours vary every week.

*Sources: Acas, overtime guidance; gov.uk, National Minimum Wage rates from April 2026; gov.uk, "Maximum weekly working hours". General information, not legal advice.*