Anglo, gold miners set aside millions for lung disease claims

Johannesburg - South African mining firms, including Anglo American [JSE:AGL], are preparing a billion rand settlement with as many as 100 000 former workers who suffer from debilitating and deadly lung diseases caused by exposure to dust from working underground.

Anglo has set aside $101m (R1.3bn) in preparation for a potential settlement, while Gold Fields expects to pay about $30m (R388m) to end a class action lawsuit, the companies said in separate statements on Thursday. 

AngloGold Ashanti [JSE:AGL], Sibanye Gold [JSE:SGL] and Harmony Gold [JSE:HAR] Mining are among 32 respondents named in the suit, which would be the country’s biggest class action.

“Significant progress has been made towards a settlement, such that companies are feeling comfortable enough to quantify their liabilities,” Richard Spoor, a lawyer representing claimants, said in a phone interview. “It’s still a process but I’m fairly optimistic we will be able to conclude something within the course of this year.”

A settlement would bring an end to almost a decade-long fight by Spoor to compensate the hundreds of thousands of mine workers who contracted silicosis, a lung disease caused by silica dust, while working in South Africa’s gold mines as far back as the 1950s.

READ: Mining firms hope for settlement in silicosis class action

Under the apartheid government, there was little protection for workers who say they were often left in mines while blasting took place and were frequently coated in the deadly dust.

Financially backed

Spoor, who runs his own law firm, is financially backed by Motley Rice LLC, a legal powerhouse based in Charleston, South Carolina and which won a $246bn settlement from the tobacco industry in 1998. Spoor has won a settlement to compensate asbestosis sufferers who incurred the disease while mining the mineral in South Africa decades ago.

The High Court last year ruled that there was enough evidence of unsafe working practices to allow a class action case to proceed and that as many as 500 000 former workers could be included. Given the difficulty in tracking down claimants and proving their employment history, the eventual figure is likely to be less than 100 000, Spoor said.

READ: Mining industry supports unclaimed benefits efforts - lung disease group

Under white minority rule, which ended in 1994, most gold mines operated a migrant labour system, with workers coming from remote rural areas and neighbouring African countries such as Mozambique and Lesotho.

Any settlement would include family members of those deceased, as long as they can prove damages, Spoor said.

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