Time Off In Lieu (TOIL) is often used on farms as a practical way to manage long hours during busy periods like seeding or harvest.

 

In theory it’s simple, work overtime now and take time off later. In practice however, it’s one of the most common areas where things go wrong.

 

How Informal TOIL Arrangements Create Risk

We recently worked with a farm that had been using TOIL arrangements during busy periods. Employees were working long days and were told they could “take the time back later” when things slowed down. There was no formal agreement in place, no written terms, and no clear tracking of hours. The arrangement was managed informally and based on a verbal understanding.

 

When work slowed down, questions started to arise:

• How much time had been accrued?
• When should time off be taken or paid out?
• What happens if it isn’t used?

 

The business wasn’t sure where they stood, and neither were the employees.

 

Where the TOIL Arrangement Was Falling Short

The issue wasn’t the intention, it was the process. TOIL must be:

• Mutually agreed in writing.
• Taken in the timeframe set by the applicable Award.
• Paid out in line with the applicable Award.

 

In this case:

• There was no written agreement in place.
• TOIL was not being formally tracked.
• There was no clarity on how it was calculated (time for time or at overtime rates).
• There was no plan for when it would be taken or paid out.

 

As these requirements were not met, our clients TOIL arrangement was not compliant. This meant the overtime worked could be treated as unpaid overtime, exposing the business to an underpayment risk.

 

How We Reset the Arrangement

We worked with the client to reset the arrangement and ensure it aligned with Award requirements.

 

First, we reviewed:

• The Award the employees were classified under.
• The specific requirements of that Award.
• What overtime and TOIL had already been accrued.

 

What the Pastoral Award Requires for TOIL

Through this, we confirmed that the employees were covered by the Pastoral Award 2020. We then clarified the key requirements for TOIL:

• TOIL cannot be directed, it must be genuinely agreed between employer and employee.
• The agreement must be in writing and include specific conditions.
• Employees can request payment of overtime instead of taking TOIL.
• Informal or “we’ll sort it out later” arrangements create significant risks.

 

From there, we supported the farm owner to implement a compliant structure:

• Put a compliant TOIL agreement and policy in writing, including required Award terms.
• Clearly define how TOIL is accrued as per the Award (time for time).
• Implement a system to accurately track overtime and TOIL balances.
• Set clear expectations around when TOIL will be taken.
• Maintain proper employee records of all TOIL agreements.

 

To ensure no TOIL went unpaid or unmanaged, we also stepped through the specific timing requirements under the Pastoral Award 2020 (clause 35.6):

• TOIL must be taken within 6 months of the overtime being worked, at a time agreed between the employer and employee.
• If not taken within that period, it must be paid out in the next pay cycle at the applicable overtime rate.

 

The Outcome

Once the structure was in place, the business had clarity and control.

• Employees clearly understood and agreed to how their time was being managed.
• Records were accurate and defensible.
• Outstanding TOIL was identified and addressed appropriately.
• The risk of underpayment claims was significantly reduced.

 

Importantly, the business could still offer flexibility but in a way that was compliant and sustainable.

 

How ProcessWorxAg Can Support You

If you’re using TOIL on your farm, it’s important to make sure it’s set up correctly. The ProcessWorxAg team can help you implement compliant TOIL arrangements, review your current setup, and ensure your systems are protecting your business. Call (08) 9316 9896 or get in touch here.

 

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