The Metal and Engineering Industries Bargaining Council (MEIBC) is a statutory body created under the Labour Relations Act (LRA) to provide for the co-regulation of stable and productive employment relations in the metal and engineering industries. More information can be found on the MEIBC website.
Examples* of agreements that could be made with the MEIBC are the following:
- Provident Fund Collection (7.1% employer and 7.1% employee)
- Dispute Resolution (R7.45 MEIBC Admin Levy and R2.68 Dispute Levy – employer and employee pay the same)
- Collective Bargaining Levy (1% employer and 1% employee)
- Sick Pay Fund Agreement (0.09% employer and 0.09% employee)
*Please note: The above are only examples. You should use the information contained in your specific agreement with the MEIBC.
The rest of this article will explain how to use a template to set the above examples up in SimplePay. More information about templates can be found in the following section:
Once you have created a template (as described in the Templates section linked to above), you can continue with the setup.
As there is a system item for provident funds, you can click Add under Regular Inputs and then select Provident Fund under Deduction. Then complete the information as follows:
- Select “% of Retirement Funding Income” next to Contribution Calculation.
- Since, in this example, both the employer and employee will be contributing 7.1% to the provident fund, enter 7.1 next to % of RFI – employee and % of RFI – employer.
- You can select the Beneficiary from the drop-down menu if you have already set up beneficiaries. To set up beneficiaries, go to Settings > Beneficiaries and click Add under the relevant fund.
- Since no information is available that this a Defined Benefit (DB) or hybrid fund, you can leave the Category Factor field blank.
- Click Save.
Please note: if you haven’t set up how employees’ RFI should be determined, the provident fund contributions will not be calculated on their payslips. To set this up, follow these steps:
- Click on Add Normal Item.
- Click on Retirement-funding income under Other.
- Select the relevant RFI Determination option from the drop-down menu.
- Click Save.
Since there is no system item for this, and if you have not previously created a custom item for it, you would add a template item for Dispute Resolution by clicking New Template-Only Item under Actions.
It is recommended that the MEIBC Admin Levy and Dispute Levy be set up separately so that they will display separately on payslips. The employer and employee contributions are set up slightly differently from each other.
On the Add New Custom Item screen, click on Benefit. The reason you should use this custom item is so that the employer contribution will be included in the employees’ taxable income as a fringe benefit. Complete the information as follows:
- When entering the Name, it is suggested that “MEIBC” always form the first part of the name. Thereafter, add the description of the item – in this case “Admin Levy”. Furthermore, it is suggested that an indication be added that this is the employer contribution; for example, you can add “CC” to signify Company Contribution. Therefore, the full name would be “MEIBC Admin Levy CC”.
- Select “Fixed Amount” as the Input Type and then enter 7.45 as the Amount.
- Select the Bargaining Council Item checkbox.
- Click Save.
On the Add New Custom Item screen, click on Deduction. The reason you should use this custom item is so that the employee contribution will be deducted from the nett pay. Complete the information as follows:
- Compose the Name in a similar way as described above, but leave out the “CC”; therefore, the full name would be “MEIBC Admin Levy”.
- The Input Type and Amount would be the same as above since the employer and employee are making the same contributions.
- Click Save.
To complete the Dispute Resolution part of the agreement, repeat the two steps above – for the Employer Contribution and the Employee Contribution – but replace “Admin Levy” with “Dispute Levy”, and enter R2.68 instead of R7.45.
Collective Bargaining Levy*
The steps in adding this item to the template are very similar to those described above for Dispute Resolution. The main differences are that it has only one component and that the levy is a percentage instead of a fixed amount.
Therefore, in this case, select “% of Income” as the Input Type and 1.0 as the Percentage.
Under Select Income Items, you should choose all the income items that should be included when the percentage of income is calculated. If it was not specified – as in the example – this information should be verified with the MEIBC so that the contribution is calculated correctly.
In cases where it is a percentage of “regular wage”, you should tick both Basic Salary and Basic Hourly Pay so that the template can be used for both hourly paid and salaried employees.
*Note: the information discussed in this section can be applied to the Sick Pay Fund Agreement as well.
Once your template is ready, you can decide on the applicability of template items, as well as which employees to add the template to. More information on these two aspects is available in the Templates section (linked to above).