Everything you need to know about the R5bn silicosis settlement as mining companies prepare to pay out

Following a lengthy legal process, the Gauteng High Court in Johannesburg recently approved a landmark settlement agreement which will see gold miners affected by silicosis or tuberculosis receiving compensation.

The settlement is between the Occupational Lung Disease (OLD) Working Group - representing African Rainbow Minerals, Anglo American SA, AngloGold Ashanti, Gold Fields, Harmony and Sibanye Stillwater. Miners were represented by Richard Spoor Inc, Abrahams Kiewitz Inc and the Legal Resources Centre.

Silicosis is caused by Sicilia dust, which cannot be seen by the human eye and is prevalent in many industries, including gold mining. It reduces the elasticity of lungs, causing chest pains and breathing problems as well as increasing the prevalence of TB, an airborne disease, according to the OLD Working Group.

Miners and their dependents battling the disease which has no cure but can be managed with the correct medical treatment, will finally be able to claim compensation from the six mining companies.

Here’s everything you need to know ahead of the difficult process of locating and medically screening thousands of miners across Southern Africa.

How many people stand to benefit?

It’s unknown how many miners and dependents are affected across South Africa and neighbouring countries, extending as far as Zambia and Malawi, due to the migrant labour system. Everyone who was employed by the six mines from March 1965 to the present and who contracted an occupational lung disease is eligible for compensation. The estimates are that thousands of people and the families of deceased miners will come forward to claim.

What will they receive?

The R5bn settlement agreement makes provision for claims between R10 000 and R500 000 for ten classes of claimants. The lowest tier is for people who were unlikely to have any prospect of success suing the mining company individually in court, to the half a million payout which is reserved for the worst cases.

Some affected miners are also entitled to claim from the Medical Bureau for Occupational Disease (Mbod) which falls under the Department of Health and this is a statutory payout for eligible workers.

Why did this take so long?

Prior to a Constitutional Court battle in 2011, miners could not sue employers for occupational lung diseases due to technical labour legislation. Test litigation for a miner, Thembikile Manyaki, suffering from Silicosis after working underground at AngloGold Ashant opened the floodgates for thousands of miners to claim compensation and it was decided to combine this in a class-action suit.

Class action suits were not part of apartheid-era legislation and it was a complex matter to set this precedent. A class-action suit was approved by the High Court in Johannesburg in May 2016. Six of the largest mining companies decided to work together with lawyers for the miners and come to a settlement agreement out of court. Negotiations were long and technical and the parties finally reached an agreement in May 2018. The court approved this agreement on July 26 in the historic judgment.

What process will people follow to be paid out?

The Tshiamiso Trust has been tasked with locating, verifying, medically screening and paying out thousands of miners across Southern Africa. The trust will be headed up by former chief inspector of mines and academic May Hermanus as chairperson. They have 12 years to complete their work and R845m for the complex administrative task ahead.

Miners will be verified as having worked at one of the six mining companies involved in the class action suit and their lungs will then be X-rayed to check for TB or silicosis. If dependents are claiming on behalf of a deceased miner, they will need to provide proof they suffered from a lung disease. Lawyer for the OLD Working Group Michael Murray expects the first claims to be paid out from early 2020.

What happens if the claims top R5bn?

The six mining companies have collectively set aside R5bn as the lowest guaranteed amount they will pay out. This figure is ring-fenced and even if they go bankrupt in the next 12 years, miners will receive their compensation, according to lawyer Richard Spoor who acted on behalf of the class claimants.

However, their liability for employees affected by Sicilia dust in the past, is infinite and they could have to pay out more than R5bn. However, Murray believes this is unlikely as they carefully estimated the number of people affected and their possible claims.

Can miners opt out of the class action settlement?

By agreeing to the class action settlement, miners acknowledge they will not try and sue the firms for more money as an individual. Between May and July, affected parties had an opportunity to make objections to the court. There was extensive advertising in print media and radio to this effect, targeting mining communities.

Before the trust begins its work in a meaningful way, notices and advertising for four weeks will inform workers they have the right to opt-out of the class settlement. They will then have a further 60 days to fill in the necessary forms.

What happens to employees affected by silicosis but did not work for the six companies who joined the settlement agreement

Thirty gold mining companies were cited as respondents in the 2012 application for a class action suit. Many of these are subsidiaries of the six companies who agreed to the settlement as the mining industry shifts and consolidates.

Two companies who did not form part of the class action settlement DRDGold and ERPM (East Rand Proprietary Mines) are waiting for an outcome to the appeal they lodged against the granting of the class action suit.

The Supreme Court of Appeal postponed the litigation in 2018 to allow for parties to the class action settlement to reach an agreement.

Lawyer for the miners, Charles Abrahams said they will reopen this case and urged the two mining houses to reach a settlement with workers, out of court.

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