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Time Off in Lieu (TOIL): The Rules in the UK, Australia, Ontario and US

Time off in lieu (TOIL) means taking paid time off instead of being paid for overtime. In the UK it depends on your contract, because there's no automatic legal right to overtime pay. In Australia it's only allowed where your award or registered agreement permits it. In Ontario it must be agreed in writing or electronically, at 1½ hours off for every overtime hour.

So the answer to 'am I owed TOIL?' is almost never the same in two countries. Below are the rules from Acas, the Fair Work Ombudsman, the Ontario Employment Standards Act guide and the US Department of Labor, so you can see which one applies to you.

TOIL rules by country at a glance

WhereIs TOIL allowed?Key rule
UKYes, if the employer offers itNo automatic right to overtime pay; the written statement must say what counts as overtime and the rate
AustraliaOnly if the award or registered agreement allows itThe award or agreement sets the terms
OntarioYes, by written or electronic agreement1½ hours off per overtime hour, taken within 3 months (or 12 with agreement)
United StatesCheck before offering itThe FLSA requires overtime pay of at least 1½ times the regular rate after 40 hours for covered nonexempt employees

Time off in lieu in the UK

Acas is clear that some employers pay for extra hours and some don't: there's no automatic legal right to overtime pay. Some employers offer a higher rate, and some offer time off instead of overtime pay. Whatever your employer does, the written statement of employment particulars must say which hours count as overtime and what the overtime rate is, so that's the first document to check.

Two legal floors still apply even when overtime is unpaid or swapped for TOIL:

  • Your hourly pay across all the hours you work can't fall below the National Minimum Wage. Unpaid overtime can push it under, so do the sum.
  • If you've regularly been paid overtime over the previous year, that overtime must be included in at least 4 weeks of your holiday pay (5.6 weeks for irregular hours and part-year workers).

Part-time staff don't get overtime until they've worked more than the normal hours of full-time staff, unless your contract says otherwise. For the holiday side, see our guide to holiday entitlement, and for pay floors, the UK minimum wage.

Time off in lieu in Australia

The Fair Work Ombudsman says some awards and registered agreements allow an employee to take paid time off instead of overtime pay, which it also calls 'time in lieu', 'time off in lieu' or 'TOIL'. The key word is some: if your award or agreement doesn't provide for it, the default is overtime pay at the rate it sets. When overtime applies, and at what rate, is different under every award, so the Pay and Conditions Tool and your award's pay guide are where the real numbers live.

Employers can only require hours beyond the maximum weekly hours where the extra hours are reasonable, and employees can refuse overtime that unreasonably exceeds them. Fatigue and safety need managing too.

Time off in lieu in Ontario

Ontario's Employment Standards Act has the most detailed TOIL rules of the four. The guide calls it 'banked' time or 'time off in lieu':

  1. The employer and employee agree, in writing or electronically, to paid time off instead of overtime pay.
  2. For every hour of overtime worked, the employee gets 1½ hours of paid time off at their regular rate.
  3. The time off must be taken within three months of the week the overtime was earned, or within 12 months if the employee agrees in writing or electronically.
  4. If the job ends before the time is used, the employee must be paid overtime pay for those hours, no later than seven days after employment ends or the next pay day, whichever is later.

What can't be done: an employee can't agree to give up overtime pay under the ESA altogether, and an employer can't lower someone's regular wage in an overtime week to dodge time-and-a-half. The ESA guide's example: if Josée normally earns $25.00 an hour, her employer can't drop her to $20.00 in an overtime week to pay a lower overtime rate, as of October 2026. More in our Ontario ESA guide.

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Time off in lieu in the United States

The Department of Labor's FLSA guidance frames overtime as pay: covered, nonexempt employees must get overtime pay of at least one and one-half times their regular rate after 40 hours in a workweek. Where a state has its own overtime law, the employee gets whichever standard pays more. If you're thinking of offering time off instead of overtime pay to US staff, check the federal and state rules for your situation first, and see our FLSA guide for who's covered.

How to set up TOIL fairly

  1. Check the law where the employee works: contract (UK), award or agreement (Australia), written agreement (Ontario) or federal and state law (US).
  2. Put the TOIL rate in writing, for example 1 hour off per hour worked, or 1½ hours where the law or award requires it.
  3. Set a deadline for using it, and what happens to unused hours.
  4. Record every hour banked and taken, side by side with overtime paid.
  5. Decide what happens to unused TOIL when someone leaves. In Ontario it must be paid out as overtime.

The verdict

TOIL works well when it's written down and tracked, and badly when it's a verbal 'take it back later'. Find the document that governs it first: the UK contract, the Australian award, the Ontario agreement or US wage law. If there's no rule allowing it, the safe default is to pay the overtime.

Frequently asked questions

What does time off in lieu mean?

Paid time off taken instead of being paid for overtime hours worked.

Is TOIL a legal right in the UK?

No. Acas says there's no automatic legal right to overtime pay; TOIL depends on what your employer offers and your contract says.

How much time off in lieu do you get in Ontario?

1½ hours of paid time off for every overtime hour, by written or electronic agreement.

Can my employer give me TOIL instead of overtime in Australia?

Only if your award or registered agreement allows it, according to the Fair Work Ombudsman.

Published and maintained by the Lilach Bullock team, covering marketing, AI and business growth.
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