The Motor Industry Bargaining Council (MIBCO) has officially gazetted a landmark three-year collective agreement covering 2025 through 2028. This deal provides much-needed stability for employers and employees by setting out fixed percentage increases and adjustments to social funds well in advance.
Understanding how these phased increases impact your specific sector is critical for budgeting and avoiding the back-pay liabilities that follow missed deadlines.
The Core 3-Year Roadmap
The agreement mandates annual increases effective on the anniversary date of the agreement (typically 1 October of each year).
Year 1: October 2025 – September 2026
- Sector 5 (Fuel Retailers): A 6% increase for Forecourt Attendants and a 5% increase for other categories (Cashiers/Chars).
- Other Sectors (1, 2, 3, 4, 6, 7): A general weighted increase of 6% for all technical and administrative grades.
- Introduction of Healthcare: Launch of the compulsory medical insurance allowance (R19.62/week) for Sector 5.
Year 2: October 2026 – September 2027
- General Increase: A flat 5% increase across most technical and administrative roles.
- Apprentices: Adjusted based on their specific year of contract to ensure the artisan pipeline remains viable.
Year 3: October 2027 – September 2028
- Final Adjustment: A flat 4% increase across all sectors.
- Fund Reviews: The council will perform a technical review of the Provident and Sick Pay funds to ensure long-term solvency.
Sector-by-Sector Highlights
Sector 5: Fuel Retailers
This sector has the most significant changes, including the mandatory Medical Health Insurance Scheme that commenced on 1 February 2026. Employers must ensure the Sector 5 Wage Rates are correctly applied to Forecourt Attendants, who are the backbone of the industry's front-line service.
Sector 6: Dealerships and Body Shops
For dealerships, the focus is on the administrative and technical staff (Grades 1-6). Sales staff remain under a different commission-based structure but must still be registered for all mandatory council levies.
Sector 7: Manufacturing and Component Makers
Artisans (Grade 7 & 8) in this sector will see their Additional Holiday Pay (AHP) rates increase proportionally with their hourly wage adjustments.
Compliance and Anniversary Dates
Missing a MIBCO wage increase deadline is not a "minor error" — it is a legal breach.
- Back-pay is Mandatory: If you implement an increase late, you must pay every employee the difference from the due date.
- Interest is Compounded: MIBCO charges interest on the total under-payment amount.
- Automatic Audit: The Online Returns system automatically flags employers who submit wages lower than the new minimums.
How to Prepare Your Business
To stay ahead of the 2025-2028 changes:
- Update Contracts: Ensure your employment contracts reference the current Main Collective Agreement to avoid ambiguity.
- Budget for On-Costs: Remember that a 6% wage increase also increases your Provident Fund and AHP contributions.
- Verify Grading: Perform a specialized MIBCO audit to ensure every technician is in the correct grade before the next increase cycle hits.
Don't get blindsided by phased increases. Download the 2025-2028 Wage Schedule Cheat Sheet from Three One Solutions and master your payroll budgeting for the next three years.