Fight goes on as Spoor & Co target coal for compensation claims

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THE class action to compensate current and former mineworkers who have contracted silicosis and tuberculosis on 30 of South Africa’s gold mines since 1965 will continue against DRDGold/ERPM and Randgold & Exploration.

In addition, human rights lawyer Richard Spoor, in partnership with the Catholic Church, is pursuing litigation against Sasol, Exxaro Resources and other coal mining companies for compensation for occupational diseases incurred by their workers, he said.

These claims are likely to amount to hundreds of millions of rands.

On Thursday, details were disclosed about a long awaited settlement between lawyers representing thousands of silicosis claimants and six of the gold mining companies who were sued: AngloGold Ashanti, Anglo American South Africa, African Rainbow Minerals, Harmony, Gold Fields and Sibanye-Stillwater. They formed a working group in 2014 to represent their interests.

DRDGold and Randgold & Exploration were not part of the negotiations. Pan African, which was, did not sign the agreement because certain details still remained unresolved, John Brand, representing the working group, said. “I hope that the mining companies in other commodities will follow this example of a settlement so we do not have a shoot-out in a court of law”, health minister Aaron Motsoaledi told a media briefing.

A trust fund, the Tshiamoso Trust, with a 12-year life, will be set up to trace and diagnose claimants and make payments of up to R500,000 each, depending on the severity of the condition. The companies will contribute R1.4bn for the first two years towards benefit payments and after that the trust will notify the companies how much they need to contribute each year.

These six mining companies have together already provided a guaranteed R5bn for compensation but the final cost could be more or less, depending how many people can be traced. The mining companies have also set aside R845m over the life of the trust for administrative expenses.

The four legal firms involved in the action – Richard Spoor, Abrahams Kiewitz, Motley Rice LLP and Hausfeld LLP – will earn R355m in legal fees. The Legal Resource Centre will receive a once-off amount of R15m for its costs.

The parties said these amounts were considered reasonable in view of the expense, length and complexity of the litigation.

In 2012, Spoor launched a class action on behalf of 17,000 former mineworkers for better compensation for these two specific debilitating conditions incurred on gold mines because the compensation provided under existing legislation – the Occupational Diseases in Mines and Works Act and the Compensation of Occupational Injuries and Diseases Act – was negligible.

In 2016 the High Court of Johannesburg allowed a class action to proceed. The gold companies appealed but the appeal was postponed while settlement negotiations took place.

Graham Briggs, representing the working group, said members decided to settle because it provided certainty for the mining companies and quicker payments to claimants.

Spoor said many of the 30,000 individuals who signed up to the class action over the years were old and ill so there was pressure to get a settlement as soon as possible. About 5,000 had died in the last five years.

“But we did not want to compromise their rights by settling too cheaply. This settlement represents a compromise and it was reached on the advice of organisations that work with these individuals and government. So we believe this is fair and the best we could have achieved in the circumstances.”

The trust is expected to be in operation by the end of the third quarter of this year, after court approval, but preliminary preparations will begin immediately.

Brand said the working group had originally intended to address the litigation, the fact that money that mining companies were paying into the compensation funds was not reaching claimants, and the lack of harmonisation between ODMWA and COIDA. But because of pressure of time, the class action received priority. The next steps would be to tackle the existing payment systems and the legislation.

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