Logo [logo]

Settlement discussions

Mine worker [photo]Class action litigation was instituted in 2012 by Richard Spoor, Abrahams Kiewitz and the Legal Resources Centre. Two NGOs, Sonke Gender Justice and Section 27, have joined as Friends of the Court.

A total of 32 respondents were cited although many of these were previous structures or current divisions of existing companies. The six Working Group companies are the six largest respondents. There are three others.

The litigation covers the period since 1965 and addresses silicosis and TB.

The South Gauteng High Court granted class certification in May 2016 after a hearing the previous October.

Even prior to the initial hearing, in early 2015, settlement talks began between the Working Group companies and the claimants' lawyers.

It may be asked why the parties are seeking a settlement rather than pursuing litigation. We believe that both groups have strong incentives:

  • Mutually acceptable comprehensive settlement which is both fair to the claimants and sustainable for the companies
  • Preferable to protracted and costly litigation
  • This would not be in the interests of former employees, many of whom are elderly
  • And it would not be in the interests of shareholders, who would prefer certainty
  • A settlement would  make some recompense for this legacy issue

The talks are well advanced and there is hope for agreement by late 2017 or early 2018. The negotiations are being conducted under conditions of confidentiality. Details cannot be disclosed until terms of a settlement are agreed.

From July to September, as a consequences of progress made, each of the six working group companies made financial provisions based on their estimates of the settlement costs. Different methodologies and bases were used so the amount cannot easily be aggregated. However, the total pre-tax nominal amount appears to amount to around R5 billion.

Any agreement will have to be ratified by the High Court in a public hearing process – this was an element of the judgment delivered in May 2016. The terms of the settlement will include not only amounts to be paid to claimants but also ensure that as many eligible claimants as possible are located, and adequate financial provision is made for the administration of the trust fund.