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South Africa’s High Court is letting up to half a million current and former miners proceed with a multi-million-dollar class action suit seeking damages from gold firms.
The decision paves the way for the workers to sue 30 companies for damages, as they claim they contracted the often-fatal lung diseases silicosis and tuberculosis from working under unsafe underground conditions.
Judge Phineas Mojapelo said workers who had died of the diseases could be included in the suits, with any damages paid to family members, Business Day reported. He also said that each mining company should be held liable separately for any damages, US-based law firm Motley Rice LLC said in a statement.
The lawsuits accuse 32 mining companies of knowingly and systematically failing to protect workers against silicosis.
A group of about 60 former miners brought the case, which is set to expand to involve thousands of elderly men from the poorest rural areas of South Africa as well as Lesotho, Swaziland, Malawi and Mozambique.
The defendants in the case include some of the world’s biggest bullion producers, including Africa’s top bullion producer AngloGold Ashanti (NYSE:AU), Gold Fields (NYSE:GFI), Harmony Gold (NYSE:HMY), Sibanye Gold (NYSE:SBGL) (JSE:SGL) and African Rainbow Minerals (ARM), all of which have together formed the Occupational Lung Disease (OLD) Working Group to deal with such issues.
“Major” blow
Ruth Bookbinder, Africa Analyst at risk consultancy Verisk Maplecroft, said Friday’s decision is a major blow to South Africa’s ailing mining sector.
In a note to investors, she said that mounting legal costs will badly hit the already struggling mining companies. Since thousands of jobs cuts are already anticipated across the sector this year, she noted that greater financial losses could lead to more redundancies.
“The mining sector accounts for the vast majority of strikes in South Africa and prospective job cuts significantly raise the likelihood of disruptive and costly labour action,” Bookbinder wrote. “With this most recent blow any hope of a recovery in the near future is fading,” she warned.
The claims go back decades, which explain why Anglo American, which no longer has any interests in gold mining, and ARM, which no longer operates gold mines, have been named in the suits.
Research indicates the miners caught silicosis, which has no known cure, from inhaling silica dust while drilling rock. The dust lodges in the lungs and causes permanent scars.
Symptoms include persistent coughing and shortness of breath, and the disease regularly leads to tuberculosis and death.
The suit, first filed in 2012, alleges the named companies knew of the dangers posed to miners by silica dust for more than a century and lists 12 specific forms of neglect and endangerment, including wilfully ignoring and/or failing to execute almost all of the recommended steps mandated in regulations and legislation designed to protect the miners from silica dust.
4 Comments
J. D. Baker
With claims reaching back many decades now retroactively declared valid, and applying also to deceased individuals, this invites massive fraudulent claims.
What are the specific criteria required to validate a claim?
What is the common sense statute of limitations here and how is any company expected to defend itself retroactively for decades old claims?
How do you substantiate claims for deceased individuals without hard diagnostic and medical records?
What does current law require of employers for employee records?
How long are employers required to retain employee records?
What legal liability did employers have for employees at the time of their death?
This is setting up a windfall for lawyers, hucksters, and political figures. If this stands the precedent set here, combined with other existing problems related to labor, legal, economic, etc., is a death knell for industry there. While the short term “payoff” no doubt provides political benefits and cover for the latest iteration of “redistributive social justice”, the real world consequence is to kill the golden goose.
djnforce9
Wouldn’t surprise me. Foolish CEO’s thinking that they could cut corners on worker health and safety to increase profit. Any company leader that only cares about nothing but the bottom line doesn’t belong in his or their position. Any shareholder that bullies a company into adopting unethical practices needs to take their stupid shares and go stuff it.
Reuvensure
Precious metals have always been the backbone of the South African economy and particularly gold benefited from the long apartheid regime which enabled mining companies to exploit their workers with impunity. This does not bode well for the SA economy as a whole.
SingleFather
“The mining industry is likely to remain an important end-user sector for the PPE market globally due to its high level of occupational hazards. However, developing countries currently lack proper regulatory enforcement. For instance, most Southern African countries have no specific PPE legislation for the workplace, and implementation of existing laws is neither strict nor continuous.”
http://ww2.frost.com/news/press-releases/frost-sullivan-industrialization-fortifies-safety-culture-and-demand-mining-ppe-emerging-countries/
*An ounce of prevention is worth a pound of cure continues to apply today.