The Kirk believes the plan will further open the debate on prayers in schools after calls for an overhaul of religious observance in non-denominational schools.
The Scottish Secular Society lodged a petition at Holyrood arguing parents should be opting in to religious observance rather than the current position where they can decide their children should not take part.
The Church said its new proposal has set principles including that headteachers should decide who leads such a Time for Reflection. A spokesman for the Church of Scotland said: "All Time for Reflection and religious observance should be genuinely inclusive of people of faith. This will not be easy but the Church believes that it can be achieved and to do so will make very significant contribution to creating a genuinely inclusive society that moves beyond tolerance to deep respect, understanding and common living based on real self-understanding about others beliefs and values."
Caroline Lynch, chairwoman of the Scottish Secular Society, said it was not opposed to re-branding it Time For Reflection, but added: "However that is a very insubstantial response to a substantial problem in our schools."