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 The most far-reaching class action settlement ever reached in South
Africa follows a long legal battle by miners to win compensation for
illnesses they say they contracted over decades because of
negligence in health and safety.
The six companies involved had already set aside the settlement
amount in provisions in previous financial statements and it should
not affect future earnings, unless the number of claimants who come
forward exceed the current provisions.
Estimates for the number of potential claimants range from tens of
thousands to hundreds of thousands. Three smaller gold producers are
not party to the settlement and the class action against them will
continue.
The class action suit was launched six years ago on behalf of miners
suffering from silicosis, an incurable disease caused by inhaling
silica dust from gold-bearing rocks.
It causes shortness of breath, a persistent cough and chest pains,
and also makes people highly susceptible to tuberculosis.
Almost all the claimants are black miners from South Africa and
neighboring countries such as Lesotho, whom critics say were not
provided with adequate protection during and after apartheid rule
ended in 1994.
The settlement is broken into three parts and a trust will have 12
years to track down the claimants and distribute the funds - no easy
task as many are in remote rural areas and may do not have proper
medical and other records.
Out of the 5 billion rand, 845 million rand will be used to cover
the administration expenses of the trust over the 12 years and 370
million rand will be paid to the law firms.
The remainder is for compensation and the final total will depend on
the number of claims that are processed.
"If there are more claimants the actuaries have estimated, then that
five billion number could increase. If there are less then it will
decrease," Graham Briggs, who chaired the Occupational Lung Disease
Working Group, a unit put together by the six companies, told a news
conference.
In addition to the anticipated settlement payout, there is also
close to 4 billion rand in a compensation fund which companies have
been contributing to for years.
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The companies involved are Harmony Gold, Gold Fields, African
Rainbow Minerals, Sibanye-Stillwater, AngloGold Ashanti and Anglo
American South Africa. The latter no longer has gold assets but
historically was a bullion producer.
SAME BALL PARK
"Our numbers differ slightly from the industry, we think there are
more claimants and that the numbers will be higher than what they
anticipate. While we differ slightly with the industry we think it's
all in the same ball park," said Richard Spoor, one of the lawyers
representing the mine workers.
It is the first class-action settlement in South Africa involving so
many companies and claimants.
"The settlement is the product of commercial negotiation and
compromise, but we believe this is a beneficial settlement," said
Carina du Toit, a lawyer with the Legal Resources Centre, one of the
law groups representing the workers.
Abrahams Kiewitz Inc and Richard Spoor Attorneys and two other
companies also represented the mine workers.
The parties said the compromise settlement was preferable for all
concerned rather than a lengthy and expensive litigation process,
and would enable the claimants to receive compensation and relief
for their conditions more quickly.
The settlement still needs approval by the Johannesburg High Court
before being implemented.
In recent years the gold mining industry has taken precautions to
prevent its workers from contracting silicosis, including the use of
masks and other measures.
(Editing by James Macharia and Richard Balmforth)
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