If it has wheels and a diesel growl, does it automatically belong in the “motor industry”? The dispute in the matter of Neniko Agencies CC vs MIBCO Highveld Region obo Mahlangu and 4 Others MPEM 7875-22 was more legal than factual. Neniko Agencies CC (“Neniko”) approached the CCMA on the grounds set out in section 62 of the Labour Relations Act No. 66 of 1995, which deals with disputes relating to the demarcation of a sector.

Mr Jako du Preez from AHI Employer’s Organisation argued on behalf of its member that it does not have to be registered with the Motor Industry Bargaining Council (“MIBCO”) as its business activities fall outside the scope of MIBCO’s Certificate of Registration (“Certificate”).

This demarcation dispute put a simple question under a legal microscope. Do employees who repair agricultural tractors and farm implements fall under the registered scope of MIBCO?

This dispute went to the heart of demarcation, and that is matching the true character of the business to the registered scope of a bargaining council, and not to incidental activities or catch-all definitions. Commissioner Dibden’s demarcation award offers a practical roadmap.

The question turned on the interpretation of the definitions of MIBCO’s Main Collective Agreement (“the Main Agreement”) as gazetted in March 2023, as well as the Certificate. Mr du Preez submitted that two matters were specifically in dispute, which were whether the Main Agreement distinguishes between a tractor and an agricultural tractor; and whether an agricultural tractor and agricultural equipment qualify as a “Motor Vehicle” in terms of MIBCO’s Main Agreement and the Certificate.

Neniko operates from their premises in Ermelo with a team consisting of two technicians, two assistants, and an apprentice, who split their time between farm call-outs and repairing, refurbishing and servicing agricultural equipment like tractors, combine harvesters and seed spreaders. From time to time, Neniko processes administrative paperwork for tractor sales on behalf of a third party for a fee, but it does not act as a dealership and does not maintain a mixed portfolio of car or truck servicing alongside its agricultural work. This was confirmed at the inspection in loco.

Firstly, the commissioner addressed the hierarchy of MIBCO’s instruments, and he ruled that the Certificate is the definitive document for jurisdictional demarcation and not the Main Agreement. Therefore, the journey begins with the Certificate, the jurisdictional GPS and only once the scope is fixed does the Main Agreement tell us how to drive within it.

After the hierarchy was determined, the commissioner went ahead to establish for which purpose the employer and employee were associated. It was ruled that demarcation must focus on the employer’s core enterprise, not cherry-picked tasks or job titles. Job titles and specific functions do not determine the industry. The decisive factor is the common-purpose nature of the enterprise, and once that industry is identified, all employees fall within it regardless of their particular duties. Accordingly, the employer’s actual activities must be identified and then assessed against the definitions in the Certificate.

Next, the commissioner considered whether MIBCO’s legal instruments intended for an agricultural tractor to be differentiated from a tractor.

The commissioner ruled that these instruments recognise a deliberate split between “tractors” and “agricultural tractors” and the split is not decorative. It signals that some wheeled, self-propelled machines sit near the boundary of the Motor Industry, and the Certificate must decide where to draw the line. The Certificate excludes the assembling, erecting, repairing, adjusting, overhauling, wiring, spray-painting and reconditioning of agricultural tractors, and it likewise excludes the manufacture, maintenance and repair of agricultural equipment or parts thereof unless those activities take place in an establishment that also provides similar services for motor cars, motor lorries or motor trucks. The exception proves the rule. Agricultural work remains outside, but a mixed workshop that truly services cars or trucks alongside those tractors is pulled back within scope for the overlapping services.

Finally, the definitions of the legal instruments were considered to determine whether agricultural equipment and tractors fall within the definition of “Motor Vehicle”. Neniko argued that towing features (e.g. a draw bar) are merely incidental to an agricultural tractor’s primary purpose and rejected MIBCO’s broad “can be used for” interpretation. Mr du Preez referred to the matter of Chauke v Santam Ltd [1996] ZASCA 120 in his Heads of Argument, where the court considered the difference between “designed for” and “can be used for”.

The commissioner supported the purposeful interpretation, which should look at the “designed for use” rather than “can be used for” approach. MIBCO failed to adduce credible and or reliable oral evidence to rebut the version of Nineko in respect of a tractor not meeting the definitions of a “Motor Vehicle” as set out in the case law referred to by Mr du Preez.

A forklift might drive on a road, but it’s really built to lift and move pallets. A road roller can travel between sites, but it’s made to flatten surfaces. If we judge these machines just because they can move or tow, we blur the lines and start calling all kinds of farm and construction gear “motor industry” machines. The “designed for” test prevents that by asking the simple question: what was this machine actually built to do in everyday use?

Applying the purpose of association test, the commissioner held that the employer and employees are primarily associated for the purpose of repair and maintenance of agricultural tractors and agricultural equipment, and should therefore fall under the exclusion within the definition. For all the reasons mentioned above, the commissioner ultimately ruled that the employees of Nineko do not fall within the registered scope of MIBCO. With the Certificate as a map and the Main Agreement as a compass, Neniko’s route remains on the agricultural side of the fence.

On 12 December 2023, NEDLAC also confirmed that it is in support of the commissioner’s award.

Written by Lize Coetzee, Director at Coetzee Attorneys Inc.