[miningmx.com] – MINISTERIAL discretion in mining related legislation has cropped up again, and is at the forefront of objections to proposed amendments to the Mine Health & Safety Act, the terms of which were published in parliament on 15 November.
Warren Beech, an attorney for Routledge Modise, says the amendments heighten the risk of personal liability for CEOs of mining companies in the event of safety breaches, and allow the mines minister to increase the maximum and minimum fines mining companies would face.
At the moment, fines of R1m to R501,000 are imposed per breach. In terms of one amendment, however, a fine of 10% of company turnover can be imposed if a guilty verdict is achieved.
Additionally, the mines minister, currently Susan Shabangu, would have the power to increase the fine without consulting the Mine Health & Safety Council, a tripartite organisation consisting of industry, unions and government representatives.
Beech thinks the amendments, if promulgated, will dissaude applications for CEO positions whilst effectively enabling the minister to impose a tax on the industry through the proposed unmediated fines process.
“Proceeds from the fines currently go to a health and safety research fund, but this is ostensibly a method of taxing the industry,’ Beech told Miningmx in a telephonic interview.
A 60-day period for public consultation has been called regarding the amendments with reponses from industry being heard before the minerals resources portfolio committee in parliament thereafter. It’s possible the proposed amendments could be promulgated after that, says Beech.
A degree of personal liability for directors and CEOs is contained in international mine health and safety law, but where South Africa’s proposals don’t benchmark is in the lack of reason. “These measures are draconian,’ says Beech of the proposed amendments.
Worryingly for the industry, the proposed amendments also extend to the issue of occupational diseases – such as silicosis and manganism – in that the minister will also have discretion to decide whether claims against employers fall under certain codes: Odimwa and Coida.
Odimwa (Occupational Diseases in Mines and Works Act) is specific to mining related repatriation claims and is restricted to medical compensation. Coida (Compensation for Occupational Injuries and Diseases Act), however, allows for more general claims against company negligence.
The upshot of the proposed amendments to the Mine Health & Safety Act is that they will increase the scope of personal liability for managers and the financial liability of the sector as a whole.
Given the increase and lack of predictability in the award of Section 54 notices, which allows the mineral resources department (DMR) to halt mining for small and large safety breaches, the widening of discretional powers is a concern.
