Regulated Increases – MIBCO Main Collective Agreement

The Motor Industry Bargaining Council (MIBCO) governs the Retail Motor Industry through collective agreements reached by the parties to the Bargaining Council. These collective agreements are binding once signed by the Minister of Labour and published in the Government Gazette. One such an agreement is the MIBCO Main Collective Agreement (hereinafter referred to as ‘the Agreement’). The Agreement regulates the terms and conditions of employment and minimum wages/salaries in the retail motor industry.

Nineteen (19) months ago, on 31 August 2019, the Agreement lapsed despite in-depth negotiations that took place from as early as March 2019, to ensure an easy transition into the new three-year period effective 1 September 2019. The result was that there was no regulated or guaranteed increase effective 1 September 2019.

Newly signed MIBCO Main Collective Agreement

The Agreement, signed by the Minister of Employment and Labour, Mr. TW Nxesi, on the 12^th of March 2021 and published in the Government Gazette on 18 March 2021, is binding on employers and employees from the second Monday after publication, which is 29 March 2021.

Wage/Salary Increases

This is a very contentious subject and need some clarification. The retail motor industry consist of sectors and in certain instances, the terms and conditions differ between the sectors. Most of our members are employed in sector 6, sector 4 and sector 7 establishments as defined below.

A. Sector 6: Establishment/Dealership actively engaged in dealers’ sales and distribution establishments (hereinafter referred to as ‘sector 6’) such as:

• Used motor vehicle, bus truck and tractor sales and repairs; or
• Franchised motor vehicle, bus, truck, tractors and parts sales and repairs.

Wages/Salaries

• The minimum wages/salaries for employees employed in a sector 6 establishment is slightly higher than that in the other sectors.
• Employees employed on the minimum wage/salary in a sector 6 establishment are entitled to the newly negotiated yearly minimum wage/salary provided for in the Agreement.

• The Agreement does not regulate or provide a guaranteed wage/salary increase for an employee employed at a sector 6-establishment earning above the minimum wage/salary.

B. Sector 4: Establishments actively engaged in services and repairs such as:

• cycle sales and repairers;
• battery sales and repairers;
• tyre sales, repairs and wheel alignment, tyre retreaders;
• exhaust, tow-bar and shock-absorber fitters;
• radio, alarms and immobilizer fitters;
• sun roof fitters;
• air-conditioning fitters;
• body repairers;
• upholsterer and motor trimmers, auto electrical repairers;
• auto valet and steam cleaners;
• prop-shafts and CV joints repairers;
• motor plastic component repairers, glass fitters;
• carburettor sales and repairers;
• drive-train fitters and repairers; only.

C. Sector 7: Establishments actively engaged in automotive parts, accessories, equipment and tools such as:

• motor parts, accessories, equipment and tools;
• auto-breakers and used parts dealer establishments only.

Wages/Salaries

• Employees employed on the minimum wage/salary in both sector 4 and sector 7 establishments are entitled to the newly negotiated yearly minimum wage/salary provided for in the Agreement.
• Employees earning above the minimum wage/salary, but below the threshold (R17 119.44 p/m excluding incentives, bonuses and commission), are entitled to a MIBCO guaranteed wage/salary increase.
• A MIBCO wage/salary guaranteed increase in terms of the Agreement is the monetary difference between the newly negotiated minimum wage/salary and the previous minimum wage/salary. These monetary values are set out in Division D of the Agreement.

• The Agreement regulates the minimum wage/salary for an employee employed in a sector 4 and 7, as well as a guaranteed wage/salary increase for employees earning above the minimum wage/salary but below the threshold.

The New Minimum Wage/Salary

You will find the newly negotiated minimum wages/salaries set out in the Agreement on the following pages:

The newly negotiated wages/salaries for clerical and workshop employees employed at a sector 6 establishment is under Division D, on page 168 to 169 of the Agreement.

(Important: – The minimum wage/salary as per the newly signed MIBCO Main Collective Agreement as far as it relates:

• Clerical Employees on page 168, the table seems to be inaccurate. MISA will revert back once we’ve obtained clarity;
• Other Employees on page 169, the information under ‘Class of Employment’ is not aligned with the newly negotiated minimum wage/salary in the ‘Minimum Wages Column’ (it is slightly below the applicable class of employee).

The newly negotiated wages/salaries for clerical employees employed at a sector 4 or 7 establishment is under Division B, on page 123 – 124 of the Agreement.

The newly negotiated wages/salaries for workshop employees employed at a sector 4 or 7 establishment is under Division C, on page 126 – 127 of the Agreement.

The Threshold and Wage/Salary Increases

Salary Increase is a complex issue. It is for this reason that we will unpack the position for employees earning above the minimum wage/salary in a sector 6 establishments, as well as those who earn above the threshold, in next week’s article.

Signatories to the Agreement

During the negotiations, MISA, in good faith, put forward certain items to the benefit of our members. The RMI did however not engage on any of those items and as a result, MISA did not sign the Agreement.

Notwithstanding the fact that MISA did not sign the Agreement, the Minister of Employment and Labour extend the Agreement to all employees, unionised and non-unionised, as well as all employers, affiliated or non-affiliated with the Employer Organisations.

The Agreement therefor applies to all employees and employers in the retail motor industry, subject to certain terms and conditions.

Conclusion

The MIBCO Main Collective Agreement has been signed and gazetted and will be enforceable with effect from 29 March 2021. Increases will be effected from 29 March 2021 and will not be retrospective.

Remember, MISA is just a phone call away.

Kindly utilise the following e-mail addresses and links for assistance during this time: