South African gold producers agreed a R5 billion ($400 million) class action settlement on Thursday with law firms representing thousands of miners who contracted the fatal lung diseases silicosis and tuberculosis, officials said on Thursday.
The most far-reaching class action settlement ever reached in South Africa follows a long legal battle by miners to win compensation for illnesses they say they contracted over decades because of negligence in health and safety.
The companies had already set aside the settlement amount in provisions in previous financial statements and it should not affect future earnings.
The class action suit was launched six years ago on behalf of miners suffering from silicosis, an incurable disease caused by inhaling silica dust from gold-bearing rocks.
It causes shortness of breath, a persistent cough and chest pains, and also makes people highly susceptible to tuberculosis.
Almost all the claimants are black miners from South Africa and neighbouring countries such as Lesotho, whom critics say were not provided with adequate protection during and after apartheid rule ended in 1994.
In addition to the settlement payout, there is also close to R4 billion in a compensation fund which companies have been contributing to for years, which will go to affected miners or the families of those who died from the diseases.
The companies involved are Harmony Gold, Gold Fields, African Rainbow Minerals, Sibanye-Stillwater, AngloGold Ashanti and Anglo American. The latter no longer has gold assets but historically was a bullion producer.
The companies said it was the first class-action settlement in South Africa involving so many companies and claimants.
“The settlement is the product of commercial negotiation and compromise, but we believe this is a beneficial settlement,” said Carina du Toit, a lawyer with the Legal Resources Centre, one of the law groups representing the workers.
Abrahams Kiewitz Inc and Richard Spoor Attorneys also represented the mine workers.
“This is an historic settlement, resulting from three years of extensive negotiations,” a statement by the working group on Occupational Lung Disease (OLD), a group put together by the six companies involved, said.
The parties said the compromise settlement was preferable for all concerned rather than a lengthy and expensive litigation process, and would enable the claimants to receive compensation and relief for their conditions more quickly.
The settlement still needs approval by the Johannesburg High Court before being implemented.