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MIBCO wage schedules and status


Members would be aware of the MIBCO wage cycle that runs from 1 September to 31 August every year. By now the new wage schedules should have been circulated to employers by either MIBCO or the RMI, however, it has not been done as the amended main agreement for year 2 of the 3 year wage cycle has not yet been published by the Minister of Employment and Labour. Only a gazetted, published and extended main agreement is compulsory for implementation and legally binding on all employers and employees. A gazetted agreement will contain an effective date for implementation (no backdating) and once we have such date all members will be updated by way of a circular inclusive of the new wage schedules and related provisions applicable for the period ending 31 August 2021.

It should be noted that we have not received any indication from the Department of Employment and Labour (DoEL) as to when publication is expected to take place, however we can advise that it is extremely unlikely to be before 01 September 2020 when the next cycle of increases commences.

We are aware of the serious financial and economic pressure that is being experienced by many Members after the protracted period of business lockdown associated with the COVID-19 pandemic and accompanying State of Disaster.
As a consequence, we wish to assure our Members that the amended MIBCO Main Agreement, once published, will contain provisions that will allow businesses in financial distress to apply for an exemption from implementing these increases. An exemption is basically a certificate issued, if approved against certain financial criteria, to an employer authorising that employer to not implement certain provisions of the agreement, such as wage- and other non-wage cash component increases.

The window period for exemption applications is 30 days from the effective date of the newly published agreement. Members therefore cannot at this stage bring any applications for exemption from implementing these increases until such time as and when the amended MIBCO Main Agreement is published in the Government Gazette. We will inform our members as soon as the agreement is published, by way of circular.

Members who are in a financial position to do so may elect to implement wage increases on 01 September 2020, or before the agreement is published, strictly on a voluntary basis, and without prejudice. Should a Member implement the increases in this way, it will be immune from having to do so again once the agreement is published given an off-set provision contained in the agreement that permits for the setting- off of increases granted in the preceding 12 months, against what is legally due and payable at the time of publication.

PLEASE NOTE that wage increases for employees of Members operating filling and / or service stations, registered under Sector 5 of the Industry, is subject to a retail profit margin adjustment. Members of the South African Petroleum Retailers’ Association (SAPRA) will only be obliged to implement wage increases for forecourt-, C-Store and wash bay staff once the Department of Mineral Resources and Energy (DMRE) has approved and implemented a concomitant retail profit margin adjustment aimed at compensating Members for the agreed increases. We will communicate separately with SAPRA members in this regards, in particular insofar as the date of the proposed margin adjustment is concerned. The advices herein related to exemptions and setting-off, applies equally to SAPRA members.

If Members have any questions in this regard, they should contact their nearest RMI Regional Office and consult with one of our highly trained IR Specialists.