South African Gold Firms Face Multi-Billion Dollar Lawsuit From Ex-Miners

South Africa’s leading gold mining firms could face the largest class action lawsuit ever seen in the African continent, said a report by Reuters on Tuesday, as former miners gather to seek compensation for lung-diseased ailments gained during years of work in decrepit conditions.

South Africa’s leading gold mining firms could face the largest class action lawsuit ever seen in the African continent, said a report by Reuters on Tuesday, as former miners gather to seek compensation for lung-diseased ailments gained during years of work in decrepit conditions.

According to the report, 6,876 former gold miners – who have worked in South Africa and neighbouring Lesotho for the past 4 decades – have signed up for the class action suit led by a South African attorney named Richard Spoor, with more and more people continuing to be added to the lawsuit every week.

[quote]“We’re signing up 500 people a week at the moment,” said Spoor, who became involved in the mining industry after winning a $100 million settlement against a South African asbestos-mining company back in 2003.[/quote]

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Related: Gold Production Countries, Gold Production, Manufacture Of Gold

The class action papers should be filed with the Johannesburg High Court “within the next few months”, Spoor noted; and the principal targets of the suit would be AngloGold Ashanti, Gold Fields and Harmony Gold – South Africa’s three largest gold miners – and minor producer DRD Gold.

The lawsuit comes just a year after a landmark ruling by the South African Constitutional Court, which allowed lung-diseased miners to sue their employers for damages.

Previously, though South Africa was the first country in the world to pass a law that recognised the need of lung-diseased miners, apartheid laws had prevented the black population from suing their employers for damages; and even after apartheid came to an end in 1994, no changes could be introduced as the mining companies and the government could not agree on the details for an overhaul of the compensation regime.

But in 2006, a South African miner named Thembekile Mankayi decided to sue his former employer AngloGold for 2.6 million rand ($319,000) in damages after contracting silicosis and tuberculosis from working in AngloGold’s mines from 1979 to 1995.

Unfortunately, Mankayi died just days before the Constitutional Court could reach its decision in March 2011. The judges also ultimately did not rule on his claim though they agreed to finally allow lung-diseased black miners to sue their employers for damages, for the first time in South Africa.

Spoor, who represented Mankayi, has since begun searching across South Africa and Lesotho to build the class action suit. According to numerous former miners interviewed, the case rests on the fact that they had never received any form of protective gear while working in the mines, while many “were never made aware of the dangers of the dust.”

[quote]”The only safety gear they gave us was gloves,” said 55-year-old Tele Nchaka, who was laid off after 33 years of service. “We didn’t have masks. To stop the dust, we just had old T-shirts that we used to make wet.”[/quote]

At the height of the industry in the 1980s, South Africa’s gold mines employed close to more than half a million workers, with medical research suggesting that as many as one in two former gold miners could have contracted lung diseases during that period.

A 2009 paper by researchers from Witswatersrand University and University College, London, estimated that there could be up to 27 billion rand ($3.5 billion) in unpaid compensation liability at present, with many of the claimants hoping to settle the case before it reaches court.

 

“We want to engage the mining companies to find out what scope there may be for sorting this out between ourselves,” said Spoor. “One way or another, we have a common in interest in resolving this.”

Peter Major, a mining industry analyst at Cadiz Corporate Solutions in Cape Town, added that with many of the men working their entire life in just one mine, the case would be almost “definitive.”

Related: South Africa Mining Industry

Related: Gold Mining Industry

[quote]”You can take a miner, trace his history and if he spent 25 years at one company, they’re definitely liable,” said Major. “There are going to be payouts, without a doubt.”[/quote]

The African National Congress (ANC), South Africa’s governing political party, has also come out in support for the lawsuit, with top ANC officials describing the case as “close to irrefutable”.

“The proof is sufficient to require compensation,” said mining minister Susan Shabangu. “They need to find an amicable settlement out of court. Going through the courts is not caring and brands the industry irresponsible.”