It is unclear whether the requirements of Mining Charter III for mining companies with regard to the housing and living conditions of their mineworkers will fall away once the Draft Reviewed Housing and Living Conditions Standard, 2019, is finalised and comes into effect, says law firm Fasken partner Godfrey Malesa.

The draft standard was published for public comment on March 20 this year.

“The draft standard states that government realises that, as an element of the Mining Charter III, the housing and living conditions standard is untenable and deprives this aspect of the mining industry of its prominence,” explains Malesa.

Under Mining Charter III, mining companies must improve the standards of housing and living conditions for mineworkers as indicated in the 2009 standard. A mining right holder is required to submit a housing and living conditions plan, which must be approved by the Department of Mineral Resources and Energy (DMRE) after consultation with organised labour and the Department of Human Settlements.

Mining right holders must also report yearly on their compliance in this regard in accordance with the requirements stipulated under the implementation guidelines of the Charter.

The draft standard seeks to ensure that adequate housing, healthcare services, balanced nutrition, water and related amenities are adequately provided for mine employees in South Africa.

While the draft standard retains many of the conditions contained in the 2009 standard, it also introduces new requirements that new and existing mining right holders will be required to comply with.

Draft Requirements

Should the draft standard be finalised in its current form, right holders will be required to, among other requirements, acquire land, after consultation with other stakeholders, in proximity to the mine operations and plan housing needs in support of a compact, integrated and mixed land use environment.

Malesa says this is a departure from the wording of the 2009 standard, which provides that “mining companies in consultation with other stakeholders, shall assist financially and facilitate the acquisition of land”.

Further, for an existing mining right holder to comply with the housing and living conditions, it will be required to submit a detailed housing and living conditions plan within six months from the date on which the new standard is published.

The plan should, among other aspects, detail how the mining right holder plans to maintain single and family units in line with the national norms and standards approved by the Human Settlements Minister.

Malesa highlights that the housing and living conditions plan and any other related plan shall be applicable for the duration of a mining right and may be reviewed every five years. The plan may not be amended or varied without the consent of the Minister.

“Existing mining right holders will also be required to submit, where applicable, a detailed plan to finalise single- and family-unit hostel conversion upgrades, a three-year detailed plan to phase out living-out allowances where verifiable decent accommodation cannot be proven and verified, and an agreed (between the mining right holder and organised union) employer-assisted home ownership scheme consistent with growth plans,” explains Malesa.

In addition, an application for a mining right in terms of the Mineral and Petroleum Resources Development Act (MPRDA) must be accompanied by a preliminary housing and living conditions plan based on the applicant’s employment forecast. The final plan must be finalised, after consultation with organised labour, within 12 months from the start of operations and must be submitted to the DMRE within 21 days from the date of signing.

When granting a mining right, the Mineral Resources Minister must take into account the applicant’s commitments in terms of the housing and living conditions plan, and the extent of compliance to the principles embodied in the standard. The final plan will form part of the terms and conditions of a mining right.

“Noncompliance with the approved housing and living conditions plan will render a mining right holder in breach of the MPRDA and subject to the provisions of sections 93, 98, 99 and 47 of the Act,” says Malesa.

Section 93 of the MPRDA enables the DMRE to enforce compliance with the Act by ordering mines to cease operations, while sections 98 and 99 deal with offences and penalties respectively. Section 47 covers the Minister’s power to suspend or cancel rights, permits or permissions.

Key Concern

One of the key concerns of the proposed draft standard is that it goes far beyond what a standard is intended to achieve.

It aims to impose enforceable legal obligations on mining companies that provide housing for employees regarding the acquisition of land for housing and the undertaking of housing developments, as well as the provision of housing options and financing schemes for housing accommodation, he avers.

“Mining companies in South Africa are not legally obligated to provide housing for workers. However, because mines are often located in remote areas, where there is often little opportunity to find housing, mining companies choose to provide accommodation for their employees.”

South Africa’s standards for housing and living conditions of mine employees are comparable to those of Australia, which are exemplary, Malesa advances.

The local mining sector has made significant inroads in improving the housing and living conditions of mineworkers by providing decent, affordable housing and accommodation. However, some challenges remain, he concludes.