A Secret about MIBCO Unclaimed AHP Bonuses (Case Study)

When Madubula Automotive Workshop reopens, it seeks compliance with MIBCO, the Motor Industry Bargaining Council in South Africa. This council oversees workplace benefits like provident funds and Additional Holiday Pay (AHP) bonuses. One employee, an artisan planning retirement, discovers an unexpected amount of over R37,000 in unclaimed AHP bonuses.

This case shows the hidden benefits of AHP bonuses. It also highlights who can claim them and how both employees and employers can ensure they don’t go unnoticed. For artisans and apprentices, knowing about these funds can add significant value at retirement or when leaving the industry.

The Discovery of Unclaimed AHP Bonuses at Madubula Workshop

When Madubula Automotive Workshop reopened, we helped register employees under new owners. One worker, a qualified motor mechanic and artisan, said he did not want to register.

He planned to return to Zimbabwe. He had already claimed his provident fund and waited for the festive season to retire. However, we needed to register him with MIBCO until he officially left.

This decision revealed something surprising. While checking his MIBCO records, we found a bonus he didn’t know about. The AHP bonus, over R37,000, had built up during his years of service.

He didn't know, and his employer also missed the contribution requirements and filing needs. Unclaimed funds move to MIBCO’s Contingency Reserves after three years but stay claimable forever.

Why Does This Happen?

The oversight by both employees and employers is common. MIBCO contributions are mandatory, and compliance requires companies to pay into these benefits for qualifying employees.

AHP bonuses don’t automatically pay out with provident funds or when you leave a job. Most people never realize they exist.

Most people don’t even know they exist. Without filing an annual MIBCO AHP form, the funds remain unclaimed, waiting for an employee to seek them.

How many artisans, PR artisans, and apprentices in the motor industry have unclaimed AHP bonuses they don't know about?

What Is an Additional Holiday Pay (AHP) Bonus?

The Additional Holiday Pay (AHP) bonus is a benefit for qualifying employees in South Africa’s motor industry. It adds value to artisans’ and apprentices’ earnings during their service.

The fund grows over time as the employer contributes to it alongside other mandatory payments. Many eligible people miss out on the AHP because they don’t claim it.

Who Qualifies for an AHP Bonus?

Employees who can claim AHP bonuses include:

1. Artisans and PR Artisans (Grade 7) include motor mechanics, diesel mechanics, spray painters, panel beaters, auto electricians, engine fitters, fitters and turners, auto trimmers, fuel injection mechanics, body builders, service advisors, and similar roles.

2. Apprentices – Those currently working or who have worked in the industry as registered apprentices.

3. Technical Employees – Certain part-time employees, workshop managers, and technical sales employees may also qualify.

These roles qualify because they register with MIBCO. Employers must contribute to the AHP bonus as part of standard compliance.

Why Do AHP Bonuses Go Unclaimed?

Many employees don’t know they can claim this money. Employers, especially smaller businesses, often don’t understand MIBCO’s requirements.

If people don’t claim the AHP bonus, MIBCO holds it for three years before transferring it to the Contingency Reserves. Even though it is still available beyond that point, employees must take the initiative to claim it.

The key issue remains awareness. Ensuring employees know their entitlements will improve compliance and reduce the amount lost to MIBCO’s reserves.

How to Claim Unclaimed AHP Bonuses

To ensure eligible employees receive their AHP bonuses, both employers and employees should follow a few simple steps:

1. Annual Verification – Both parties should check MIBCO statements every year to see if contributions have built up.

2. File the MIBCO AHP Form – Employers file the MIBCO AHP form each year to record employees’ bonus entitlements.

3. Initiate Claim with MIBCO – Employees can contact MIBCO or visit a MIBCO office to file their claim. Former employees should confirm their unclaimed bonus status.

4. Account Requirements – Make sure the employee’s bank account is active. Payments usually arrive within seven days for electronic fund transfers (EFTs).

The process is simple, yet the biggest barrier remains awareness. Helping employees understand their entitlements will improve compliance and reduce unclaimed funds.

Example of Potential Earnings

To illustrate the significance of these contributions, here’s a hypothetical example:

Imagine a diesel mechanic who has worked with one employer for 15 years without claiming his AHP bonus. If we assume a steady, modest contribution that grows each year, his unclaimed bonus could exceed R30,000. This could mean a much-needed financial boost for many artisans, especially those preparing for retirement.

Compliance Tips for Employers: Bonus Caps and Guidelines

MIBCO offers a capped bonus structure that may help employers manage compliance costs. Employers cap bonuses for employees earning above the national threshold of R21,197.64 a month or R4,891.76 a week. This cap helps smaller businesses manage compliance costs.

For the upcoming period, the capped bonus limits are:

• From 01 September 2024 to 31 August 2025: R6,346.68 per annum.

Employers registered under Chapter III of Division C pay a leave bonus of 3 weeks of actual wages, with no cap. Following these guidelines helps employers stay compliant while ensuring artisans receive their entitled benefits.

A Message for Employers and Employees

For artisans, apprentices, and PR artisans in the motor industry, checking for unclaimed AHP bonuses is essential. It is not just money left on the table; it is a benefit that you or your family could claim. For employers, knowing about AHP contributions can help businesses stay compliant and improve worker satisfaction.

The Role of Three One Solutions in MIBCO Compliance

Three One Solutions helps South African motor industry businesses with MIBCO compliance. We guide employers and employees in payroll, HR, and complete management. We show them how to maximize benefits and avoid penalties. We offer:

• Full-Service Packages – Complete MIBCO compliance management.

• Consultations – Tailored compliance support for unique cases.

• Workshops and Online Courses – Educational resources to help employers understand and implement best practices.

Our goal is to simplify compliance and ensure that artisans, apprentices, and PR artisans receive the benefits they deserve. If you suspect unclaimed bonuses, we can help you find and claim what is yours.

Visit ThreeOneSolutions.com to learn more about claiming your MIBCO entitlements or for expert advice on motor industry compliance.