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In lieu means “in place of”. Time-in-lieu refers to the time an employee is granted off from work for working overtime, i.e., beyond scheduled weekly working hours. Instead of receiving payment for their work beyond usual working hours, they are allowed rest from work on working days.
Modern-day employees expect flexible working hours at the workplace, which facilitates them in maintaining a robust work-life balance. Furthermore, in such an environment, they are less likely to experience stress or burnout, which seriously impacts the efficiency and productivity. When negotiating about working overtime and compensation for that time, time-in-lie emerges as a useful tool.
Time-in-lieu is commonly seen in enterprises where a worker may need to work on weekends, weekdays, or when a job is fairly stressful. Thus, employees in such a scenario benefit more from compensation given in the form of time off from work instead of overtime pay.
The amount of time-in-lieu offered to an employee is incumbent on the number of hours an employee worked over the normal working hours stipulated in the contract. So, for instance, if a worker grinds for 8 hours per day in a 5-day workweek, which equals 40 hours of work/ week. Now, if an employee worked for about 44 hours in a particular week, he/ she must be granted 4 hours, which implies half a day. Employment and labor regulations regulate and limit regular and overtime working hours, which an employer needs to abide by.
During peak business days it is often expected to work overtime in order to meet the deadlines on time. In those peak days an employer can provide either extra pay or time-in-lieu in order to compensate their overtime.