One of the features of Time Out is the ability to detect natural breaks, i.e. when your Mac is idle, not being used.
In version 1, this was detected via what I call the "Event Source" mechanism, but this can be unreliable for some people, as some apps can make it look like you are using the computer, when it's just an automated activity. So in version 2 I switched to a new approach, which I call "Event Monitor". This is generally more reliable, but has one downside: it requires a manual step by you to allow it, as discussed below. It can detect mouse or trackpad movement, but to detect keyboard activity you need to authorize it. Note that Time Out doesn't log or even watch what you type, it is just detecting any key press as a sign that you're actively using your computer.
Because not everyone wants idle detection at all, or would prefer the old approach, I added a preference on the Advanced Options page: "Natural break detection method". This pop-up menu includes options to disable idle detection altogether, or switch between the two approaches.
When you first launch Time Out, the second page of the Setup Assistant includes instructions on how to authorize idle detection. It's pretty simple, though a number of steps to navigate to the right place:
Since that could seem overwhelming, here's a very brief video demo:
(Or watch on YouTube.)