My backyard is slightly sloped as well, which is a challenge because of erosion issues. One of the first things I did a few months after settling into our new home(this was about 4 years ago), was to sketch a rough plan of how I wanted the area to look. Having a plan down on paper where exactly you want grass, thyme and flowers will help you stay focused. Because I wanted a tiered look, I penciled in tall evergreens to the back, medium height perennials next and so on. To control erosion, my solution was to till the beds well, (I don't till them anymore-just add compost as needed)add compost/soil, edge them deeply in the spring and fall, and after planting cover well with mulch. I placed plastic edging material,kind of looks like a mini fence, around my veggie bed which is at the top of the hill, the highest point in the yard.

Before you do anything, I highly recommend getting a soil sample and sending it out for testing to see exactly what if any ammendments are needed.

Backtracking a bit, I used a garden hose in the shape of each bed, eyeballed it-I tend not to measure, then spray painted the shaped onto the grass.(Because I didn't really like the idea of using paint on the ground, a couple of times , I put flour into a zip lock bag, and snipped the corner to make the outline. Since I was digging the same day, and it wasn't windy, this worked fine.)

I personally feel that growing grass is a tougher issue than managing flower beds, and other plants because it is water loving, and I hate watering! Anything that lives in my yard, is hardy because I simply don't have time to go out and water every other day. Ground cover is great! If my husband would agree to it, I'd cover our front lawn with it, but that was a no go, so I used it as an undercover for one of my flower beds. It's totally maintanance free.

Because my family loves grass, and we live in a development in the burbs, I grew grass.:( For the grassy areas of my backyard, initially, I roughened the soil with a rake and continued to overseed each year-fall and spring. Handpick any weeds, and eventually the grass will take over. That should also work in areas where you'd like to grow thyme. Until your plants become established, the rain will continue wash the top soil right down the hill. Now is a good time to prepare the ground for new seed, but fall is the best time for new lawns. However, you can start them in the spring as well. You won't get much germination in early spring though, but there's no harm in spreading the seed anyway. You should also consider how much sun the area gets-full, shady, and purchase grass seed based on that. Be sure to keep the seedlings moist.

Also, it's a perfect time to plant small dormant plants. There are several on-line nurseries that sell a variety of well-priced thymes. Hope this helps.

Janine