Puppies don't understand "time out". Watch how dogs interact and take your cues from them on an effective correction.
With dogs it is quick, loud, and it usually involves a very quick advance.
No nagging.
No time outs.
No grudges.
It is WHAM.
DONE.
Impression made.
SO with puppies who are a little too big for their britches and want to use you for a chew toy, I discourage it by taking the pup by the muzzle, or the loose skin under the chin, and with direct eye contact, I say, nose to nose, "NO BITE". I use a low tone of voice, not loud, and the instant the pup looks away or puts his tongue out, I release him and move on. You may, after such a correction, happily redirect the pup to his toy box to get a toy, or help him find one nearby, and praise him for mouthing the toy.
If you will do a search in the net on "BITE INHIBITION IN PUPPIES" you will get lots of information on how to teach puppies not to mouth.
One excellent way is to teach the "OFF" command. Take a handful of very small soft treats. Feed one to the puppy, and close your hand around the rest. Say nothing. As soon as the puppy moves away a bit and does not touch your hand for a second or 2, say "OFF", Good pup, and give him another bite of the food. Repeat 5X per day, 3X daily, for 15 reps in a day. Once the puppy learns what off means, you can use this verbal reminder if he forgets and mouths.
Do remember that chewing is NECESSARY for puppies, especially during the teething stages. Make sure your pup has good approved and satisfying things to chew during this time, and consistently discourage him from trying to mouth you, your clothing, or the leash.
Please check out my puppy training article, Puppy Raising 101, on this site, for some more great pointers.
Let me know if you cannot find it and I will bump it up for you.