South Africa’s automotive component manufacturing, fuel, and retail sectors have signed a three-year wage agreement, capping more than four months of negotiations. The deal, which offers wage hikes and new benefits for workers, aims to balance business sustainability with employee compensation.
The agreement, forged under the Motor Industry Bargaining Council (MIBCO), was finalized by employer representatives from the Retail Motor Industry Organisation (RMI) and the Fuel Retailers Association, and employee unions including the Motor Industry Staff Association (MISA) and the National Union of Metalworkers of South Africa (Numsa).
“The RMI is satisfied with the outcome… as it reflects the mandate of our members, while balancing the realities and sustainability of businesses,” said Jeffrey Molefe, RMI’s labor director.
The new deal provides varying increases across the sectors:
- Component Manufacturing: Employees will receive a 6% wage increase in the first year, followed by 5% in the second and third years.
- Retail: A 5% increase on minimum wages will be implemented in each of the three years.
- Fuel Retail:
- Forecourt Attendants: A 6% raise in year one, 5% in year two, and 4% in year three, plus a 1% medical insurance allowance annually.
- Cashiers: A 6% raise in year one, and 4% in years two and three, also with a 1% medical insurance allowance each year.
A key new benefit is the primary healthcare allowance, which MISA noted will be offered to employees from January 1, 2026. This is the first time such a benefit has been negotiated for service station workers. “This is the very first time that such a benefit has been negotiated and we are pleased that this round of negotiations has ensured that the foundation has been laid for the lowest-paid workers to receive access to quality private healthcare,” said a Numsa spokesperson.
The agreement, effective from September 1, 2025, will be submitted to the Minister of Employment and Labour for gazetting, at which point its provisions will become legally binding for all employers and employees within MIBCO’s jurisdiction.
