A lieu day — short for “time off in lieu” or TOIL — is a day of paid time off granted to an employee in exchange for hours they worked beyond their normal working pattern, typically on a weekend or bank holiday. Instead of receiving overtime pay, the employee receives equivalent time off at a later date.
Lieu days are widely used across UK workplaces as a flexible alternative to overtime payments. They benefit employees who value time off over extra pay, and employers who want to manage labour costs without demoralising staff who work additional hours.
Key Takeaways
- A lieu day is paid time off granted in exchange for extra hours worked, commonly called TOIL in the UK.
- Employers must agree whether lieu time is offered instead of, or in addition to, overtime pay.
- Lieu days are not a statutory entitlement — they depend on your employment contract or workplace policy.
- Without a clear policy, lieu days can create disputes over expiry, approval, and accrual.
- Track lieu days in a leave management system to prevent untracked liability and ensure fair usage.
What Is a Lieu Day?
A lieu day is compensatory time off. When an employee works additional hours — for example, working a full Saturday to cover a project deadline — the employer grants them a day off on another working day to compensate.
The term “in lieu” means “in place of.” So a lieu day is a day off in place of the extra hours worked. It is not additional holiday. It is a direct trade: hours worked beyond the norm are exchanged for equivalent hours off.
How Lieu Days Differ from Annual Leave
| Lieu Day (TOIL) | Annual Leave | |
|---|---|---|
| Earned by | Working extra hours | Employment entitlement |
| Statutory | No | Yes (UK: 5.6 weeks minimum) |
| When taken | Agreed with manager | Employee’s choice (subject to policy) |
| Carryover | Depends on employer policy | Statutory minimum must be offered |
| Paid on termination | Usually not (depends on contract) | Yes (for accrued but untaken leave) |
How Time Off in Lieu Works in the UK
In the UK, there is no statutory right to TOIL. The Working Time Regulations 1998 govern working hours and rest periods, but they do not require employers to offer lieu time instead of overtime pay.
Whether TOIL is available depends entirely on:
- Your contract of employment — Some contracts include a TOIL clause.
- Your employer’s policy — Many employers have a written TOIL or overtime policy.
- The specific arrangement — In some workplaces, TOIL is agreed informally between a manager and employee.
If your contract says nothing about TOIL, you are not automatically entitled to it. Equally, if your employer has historically offered TOIL, they cannot withdraw it without reasonable notice and consultation.
When Lieu Days Are Common
- Bank holiday working — Employees required to work on a bank holiday are often given a lieu day in addition to (or instead of) their normal pay.
- Weekend or evening work — Employees who work outside standard hours may accumulate lieu time.
- Event or project coverage — Staff who work during busy periods (e.g., end-of-quarter, product launches) may bank lieu days for quieter periods.
Lieu Days vs Overtime Pay
The choice between lieu days and overtime pay depends on the employer’s policy and, in some cases, the employee’s preference.
| Factor | Lieu Days | Overtime Pay |
|---|---|---|
| Cost to employer | Delayed (time off later) | Immediate (extra wages now) |
| Benefit to employee | Extra day off | Extra money |
| Tax implications | None (paid normal wages on the lieu day) | Subject to income tax and NI |
| Scheduling | Requires planning coverage | No scheduling impact |
| Employee preference | Favoured by those valuing work-life balance | Favoured by those valuing income |
Some employers offer a choice: the employee can take the time off or receive overtime pay. This is the most flexible approach, but it requires clear tracking to prevent double-counting.
Building a Lieu Day / TOIL Policy
Without a written policy, lieu days become a source of confusion. Employees may assume they can accumulate unlimited TOIL, managers may forget previously agreed arrangements, and disputes arise when someone requests time off that was never formally approved.
A strong TOIL policy covers these elements.
1. When TOIL Is Offered
Specify the circumstances under which TOIL is available. Is it only for bank holiday working? For any hours beyond the standard contract? Only when approved in advance by a manager?
2. Accrual Rate
Define how lieu time accrues. Common approaches include:
- Hour for hour — 1 extra hour worked = 1 hour of lieu time.
- Enhanced rate — For example, bank holiday hours accrue at 1.5x (8 hours worked = 12 hours of lieu time).
3. Maximum Accrual
Set a cap to prevent employees banking months of TOIL. A typical cap is 5–10 days. Once the cap is reached, additional hours are paid as overtime or lost.
4. Usage and Approval
State that lieu days must be taken with manager approval, with a minimum notice period (e.g., 2 weeks). This prevents last-minute requests that disrupt team scheduling.
5. Expiry
Define when accrued TOIL expires. Without an expiry clause, old TOIL becomes a growing liability. Many employers set a 6- or 12-month expiry from the date it was earned.
6. Treatment on Termination
Clarify whether accrued TOIL is paid out on termination. In the UK, TOIL is not automatically treated as accrued holiday, so it may not be payable unless the contract or policy says otherwise.
Tracking Lieu Days
Lieutime tracking is where most organisations slip up. If a manager verbally agrees to give someone a day off “for working Saturday,” that arrangement lives only in memory. When the employee requests the day off three months later, nobody remembers — and the employee feels short-changed.
A leave management system records each TOIL entry with the date it was earned, the hours accrued, and the expiry date. It gives employees visibility of their balance and gives managers a clear record of what was agreed.
Frequently Asked Questions
Is a lieu day the same as a day in lieu?
Yes. “Day in lieu,” “lieu day,” and “TOIL” (time off in lieu) all refer to the same concept: paid time off granted in exchange for extra hours worked.
Are employers legally required to give lieu days in the UK?
No. There is no statutory right to TOIL in the UK. Whether lieu days are available depends on your contract, your employer’s policy, or an informal agreement with your manager. However, if your employer has consistently offered TOIL, withdrawing it without notice may constitute a breach of contract.
Can I cash out my lieu days instead of taking time off?
Only if your employer’s policy allows it. Lieu days are not the same as accrued annual leave, so they are not automatically payable on termination. Check your contract or ask HR.
How many lieu days can I accrue?
This depends on your employer’s policy. Many organisations cap TOIL at 5–10 days. Once you reach the cap, additional overtime hours may be paid as wages or lost, depending on the policy.
Do lieu days expire?
They can. Many employers set an expiry of 6–12 months from the date the TOIL was earned. If your policy does not specify an expiry, the TOIL generally remains available until used or until employment ends.
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