TL;DR
The Sector 5 (Fuel Retailers) wage rates — R45.79/hour for a Forecourt Attendant — were introduced as part of a DMRE retail profit margin play in October 2025. Implementation at that stage was optional. The rates became legally binding for all Sector 5 employers on 22 December 2025, when Government Gazette No. 53822 extended the MIBCO Main Agreement to non-parties under Section 32(2) of the Labour Relations Act. A mandatory Medical Insurance Allowance of R19.62 per week must be paid directly to the employee — separately from wages. From 1 February 2026, a compulsory medical health insurance scheme also took effect. Missing either obligation exposes you to back-pay, interest penalties, and MIBCO arbitration.
The updated Sector 5 (Fuel Retailers) minimum wage rates form part of the MIBCO Main Agreement 2025–2028, negotiated under the Sector 5 Settlement Agreement. In October 2025, the Department of Mineral Resources and Energy (DMRE) implemented a retail profit margin adjustment for fuel retailers and the wage rates were tied to that process. At that stage, implementation was optional because the agreement had not yet been formally extended to non-parties.
That changed on 22 December 2025. Government Gazette No. 53822, published 12 December 2025, extended the MIBCO Main Agreement to all motor industry employers under Section 32(2) of the Labour Relations Act No. 66 of 1995. From that date, the rates are legally binding - whether or not you are a registered MIBCO member.
The Motor Industry Bargaining Council (MIBCO) governs wage compliance for all Sector 5 employers from 22 December 2025. The back-pay liability runs from that date regardless of when you find out.
This guide covers the exact 2025/2026 rates, the mandatory medical allowance, the February 2026 insurance scheme, and what happens when MIBCO inspectors show up at your forecourt.
What Are the MIBCO Sector 5 Minimum Wages Effective 22 December 2025?
The following minimum wages apply to all Sector 5 employees from 22 December 2025, as set out in the Sector 5 Settlement Agreement and gazetted under Government Gazette No. 53822. Rates are based on a standard 45-hour work week.
| Position | Hourly Rate | Weekly Minimum (45 hrs) | | ----------------------- | ----------- | ----------------------- | | Forecourt Attendant | R45.79 | R2,060.55 | | Cashier | R45.30 | R2,038.50 | | Char / Cleaner | R34.64 | R1,558.80 |
These are minimums under the Basic Conditions of Employment Act (BCEA). If your current contracts already specify higher rates, maintain them and still apply the minimum percentage increase where applicable.
Not sure whether your current payroll is aligned? At ThreeOneSolutions, we audit Sector 5 wage schedules against the 2025–2028 rates as part of every compliance engagement and this table is the first thing we check.
What Is the Mandatory MIBCO Medical Insurance Allowance for Sector 5?
In addition to the basic wage, Sector 5 employers must pay a Medical Insurance Allowance directly to each employee every week.
- Amount: R19.62 per week
- Paid to: The employee directly, not to MIBCO
- Payslip requirement: Reflected as a separate line item on every payslip
- Frequency: Fixed weekly, payable even if the employee works reduced hours or takes leave that week
The Medical Insurance Allowance is not optional and it is not a MIBCO contribution. It is an employee entitlement.
In our compliance audits at ThreeOneSolutions, the Medical Insurance Allowance payslip error is the single most common non-compliance issue we flag at Sector 5 stations. Either it is missing entirely, or it is absorbed into the base wage instead of appearing as a separate line. Both are non-compliant.
This is exactly the kind of payroll gap a ThreeOneSolutions compliance audit is designed to catch before a MIBCO inspector does.
Does the Set-Off Rule Apply to Your Station?
Employers who granted wage increases above the prescribed rates in the preceding 12 months may offset those increases against the new minimum but only under strict conditions.
Under Clause E of the Sector 5 Settlement Agreement, this set-off is permitted once only during the full term of the 2025–2028 agreement. A second set-off in a subsequent year is a compliance violation, regardless of the size of the earlier increase. If you gave above-prescribed increases before December 2025, verify with a compliance specialist before applying any offset.
What Is the Compulsory Medical Health Insurance Scheme That Took Effect in 2026?
Per MIBCO Circular 2025/00042, dated 22 December 2025, the compulsory medical health insurance scheme for Sector 5 is effective from 1 February 2026. MIBCO has partnered with Affinity Health to administer the scheme. This is a structural change not an update to the allowance.
Who Does It Cover?
Every Forecourt Attendant, Cashier, and Char is automatically enrolled from 1 February 2026 or their employment start date, whichever is later.
What Are the Contribution Rates?
The scheme operates on a split-contribution model. Both amounts are remitted to MIBCO through the Returns system by the 10th of each month:
| Party | Year 1 (Feb 2026 – Aug 2026) | Year 2 (Sept 2026 – Aug 2027) | Year 3 (Sept 2027 – Aug 2028) | | ------------------------- | ---------------------------- | ----------------------------- | ----------------------------- | | Employer allowance | R85.00/month | R90.00/month | R95.00/month | | Employee contribution | R174.00/month | TBC | TBC | | Total scheme cost | R259.00/month | — | — |
Important exception: No contributions are payable for any week in which an employee works fewer than 23 hours. An employee will not be covered for any period in which no contributions are paid.
What Are the Employer's Obligations?
- Configure your payroll: Your payroll system must process both the employer allowance and the employee deduction from February 2026, and remit both to MIBCO by the 10th of the following month
- Process opt-outs correctly: Employees have 60 days from scheme commencement or employment start date to opt out by completing the opt-out form at their nearest MIBCO Regional office. There are two ways an employee loses the right to opt out: failing to submit within 60 days, or using the scheme benefits at any point during the 60-day window — either locks them in permanently
- Understand the coverage: The scheme provides access to GP consultations, acute and chronic medication, basic dentistry, optometry, emergency medical services, radiology, and a hospital accident benefit of up to R100,000 per annum through Affinity Health
The key distinction your Liable Person must understand: the Medical Insurance Allowance (R19.62/week) is paid directly to the employee. The scheme contribution (R85/month employer + R174/month employee) is remitted to MIBCO. They are not the same obligation. Confusing them is one of the fastest ways to accumulate back-pay liability.
What Are the Risks of Not Implementing These Changes?
MIBCO's inspectorate conducts what the industry calls Ghost Audits, unannounced site visits specifically targeting fuel stations to verify hourly rates and allowances. Fuel retailers are a priority sector for these audits.
Non-compliance results in:
- Back-pay liability: You pay the shortfall for every hour worked since 22 December 2025, the back-pay runs from that date, not the date of the inspection
- Interest penalties: MIBCO charges interest on all under-remitted amounts
- DRC referrals: Unresolved wage disputes escalate to MIBCO's Dispute Resolution Centre (DRC), which issues binding arbitration awards against the employer
Under the Labour Relations Act No. 66 of 1995, a binding arbitration award has the same legal force as a court order. That means sheriff enforcement, attachment of assets, and reputational damage, all from a payroll error that costs almost nothing to fix in advance.
ThreeOneSolutions helps fuel retailers close these gaps before they become arbitration awards. A compliance audit costs far less than one DRC outcome.
How Do You Prepare Your Payroll for the December 2025 Changes?
Work through this checklist before your next pay run:
- Update your payroll software: Confirm your provider has loaded the Sector 5 tables effective 22 December 2025
- Add the Medical Insurance Allowance as a separate payslip line item: R19.62 per week, paid to the employee, not bundled into wages
- Enroll eligible employees in the February 2026 scheme: Forecourt Attendants, Cashiers, and Chars are automatically enrolled from 1 February 2026. Ensure your payroll is configured to process and remit both the employer allowance and employee deduction to MIBCO by the 10th of each month
- Train your Liable Person: The Liable Person on your site must know the difference between the allowance (paid to the employee) and the insurance contribution (remitted through the scheme)
- Audit historical records: If you missed the 22 December 2025 deadline, run a self-audit immediately, calculate the back-pay before an inspector arrives and quantify the liability yourself
A missed deadline is not the end. Self-correction before an inspection is always the better outcome.
Frequently Asked Questions
What are the MIBCO minimum wages for Sector 5 fuel retailers in 2025?
The current minimum rates: Forecourt Attendant R45.79/hour (R2,060.55/week at 45 hours), Cashier R45.30/hour (R2,038.50/week), Char R34.64/hour (R1,558.80/week) are set out in the Sector 5 Settlement Agreement.
These rates were tied to a DMRE retail profit margin adjustment in October 2025 but only became legally binding on 22 December 2025, when Government Gazette No. 53822 extended the MIBCO Main Agreement to all Sector 5 employers.
Does the MIBCO Medical Insurance Allowance apply even when an employee is on leave? Yes. The R19.62 per week Medical Insurance Allowance is a fixed weekly entitlement. It applies regardless of whether the employee works reduced hours or takes leave during that week.
What happens if I don't implement the December 2025 wage rates? From 22 December 2025, these rates are mandatory for all Sector 5 employers. Non-compliance means back-pay liability for every hour worked since that date, plus interest. Ongoing non-compliance can result in a DRC referral and a binding arbitration award against your business.
Who qualifies for the compulsory medical health insurance scheme in 2026? Forecourt Attendants, Cashiers, and Chars are automatically enrolled from 1 February 2026 or their employment start date, whichever is later.
Employees have 60 days to opt out by completing the opt-out form at their nearest MIBCO Regional office. Two things permanently lock an employee into the scheme: failing to opt out within 60 days, or using the Affinity Health benefits at any point during that window.
How do MIBCO Ghost Audits work at fuel stations?
MIBCO inspectors conduct unannounced site visits "Ghost Audits" specifically targeting Sector 5 employers. They check hourly rates, payslip line items (including the Medical Insurance Allowance), and compliance with the current MIBCO circular. No advance notice is given. Back-pay liability is calculated from the effective date of non-compliance, not the date of the audit.
Are MIBCO minimum wages different from the National Minimum Wage?
Yes. The National Minimum Wage Act No. 9 of 2018 sets a floor for all South African workers. MIBCO's sectoral minimums are higher and where a bargaining council agreement exists, the higher rate applies. Sector 5 employers must meet the MIBCO rates, not the national minimum.
Catch the gaps before MIBCO does. ThreeOneolutions.com — MIBCO Compliance for the Motor Industry
Written by the Founder & MIBCO Compliance Specialist at ThreeOneSolutions.com - HR compliance for South Africa's motor industry.