Does MIBCO Apply to Your Business? Lessons from Neniko Agencies CC

When Does MIBCO Really Apply?

If it has wheels and an engine, does it automatically fall under the Motor Industry Bargaining Council (MIBCO)?

The main question in a recent case is about MIBCO's rules. The case is Neniko Agencies CC vs MIBCO Highveld Region obo Mahlangu and 4 Others (MPEM 7875-22). It gives important advice for employers who are unsure if MIBCO applies to their work.

💡 Quick answer: The case confirmed that businesses repairing only agricultural machinery are not under MIBCO’s jurisdiction.

👉 If you’re unsure where your business stands, book a MIBCO Compliance Audit to get clarity before the next inspection.

⚖️ Case Background

Neniko Agencies CC, based in Ermelo, repairs and services agricultural tractors and farm implements — not cars or trucks. When MIBCO claimed jurisdiction, Neniko went to the CCMA. They did this under Section 62 of the Labour Relations Act. This section deals with demarcation disputes. These disputes decide which sector or bargaining council a business belongs to.

Mr. Jako du Preez from the AHI Employers’ Organisation represented Neniko. He argued that Neniko's operations are not part of MIBCO’s legal scope.

❓ What Was the Main Legal Question?

Do employees who repair agricultural tractors and equipment fall under MIBCO, or are they part of the agricultural industry?

The dispute was about whether agricultural tractors should be treated like motor vehicles. This was under MIBCO’s Certificate of Registration and Main Agreement.

Step 1: The Certificate Is the Legal Map

The Certificate of Registration — not MIBCO’s Main Agreement — determines whether MIBCO applies to a business. The Main Agreement only governs how to comply once jurisdiction is confirmed.

Commissioner Dibden described it best:

Step 2: Focus on the Business’s Core Activity

Demarcation isn’t about job titles or incidental tasks. It’s about the true purpose of the enterprise. Neniko’s main business was repairing and maintaining agricultural machinery — not servicing cars or trucks. Therefore, it fell outside MIBCO’s scope.

✅ Key takeaway: If your workshop focuses purely on farm or industrial equipment, MIBCO may not apply.

Step 3: Tractor ≠ Agricultural Tractor

MIBCO’s own documents distinguish clearly between tractors and agricultural tractors.

• Agricultural tractors and implements are excluded from MIBCO’s jurisdiction.

• But mixed workshops — those that also repair cars or trucks — remain within MIBCO’s reach.

Example:

Step 4: “Designed For” vs “Can Be Used For”

Neniko argued that classification should depend on what a machine is designed to do, not how it can be used. A forklift can drive — but it’s made to lift pallets. A tractor can tow — but it’s built for farm work. This “designed for” test ensures agricultural machinery isn’t incorrectly pulled into the motor industry.

The Outcome

• Neniko’s employees were ruled not to fall under MIBCO.

• The company was confirmed as part of the agricultural industry.

• NEDLAC supported the decision on 12 December 2023.

With the Certificate as the map and the Main Agreement as the compass, Neniko stays on the farm side of the fence.

💡 Key Lessons for Employers

1. Start with the Certificate of Registration. It defines MIBCO’s boundaries.

2. Assess your main activity. Don’t rely on job titles or side services.

3. Mixed workshops beware. Servicing cars or trucks brings you under MIBCO.

4. Use the “designed for” test. It clarifies which machines count as motor vehicles.

5. Get a compliance audit. Avoid costly registration errors and penalties.

FAQs: Demarcation Disputes and MIBCO

• Q1. What is a demarcation dispute under the Labour Relations Act?

  A demarcation dispute decides which industry or bargaining council a business belongs to under Section 62 of the LRA.

• Q2. How can I check if MIBCO applies to my business?

  Start with your Certificate of Registration and your core business activity. If you mainly repair or sell vehicles, MIBCO likely applies. If you focus on farm or industrial equipment, you may be excluded.

• Q3. What happens if I’m wrongly registered with MIBCO?

  You could face unnecessary fees, back-pay obligations, or inspection penalties. A MIBCO Compliance Audit helps confirm your correct industry.

• Q4. Can agricultural mechanics be exempt from MIBCO?

  Yes. The Neniko Agencies CC vs MIBCO case shows something important. Agricultural machinery repairers are not included in MIBCO’s registered scope. This is true unless they also repair vehicles.

What This Means for You

If you’re unsure whether your business falls under MIBCO, it’s time to find out — before an inspection does. At Three One Solutions, we help South African motor industry employers:

• Understand which bargaining council applies

• Conduct MIBCO Compliance Audits

• Handle demarcation disputes confidently

👉 Book your MIBCO Compliance Audit today

Author: Elleck Mgiba, Founder, Three One Solutions | 20+ years in the Motor Industry | MIBCO Compliance Specialist.

Source: Lize Coetzee, “A Practitioner’s Roadmap to Demarcation Disputes” – Polity.org.za, 23 Oct 2025