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SASLAW. April  SASLAW Gauteng Seminar. BASIC CONDITIONS OF EMPLOYMENT AMENDMENT BILL, 2012 Presented by: Shamima Gaibie. Payments to employees or requirement to purchase goods, products or services by an employee.

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Saslaw

SASLAW

April  SASLAW Gauteng Seminar

BASIC CONDITIONS OF EMPLOYMENT AMENDMENT BILL, 2012

Presented by: Shamima Gaibie


Saslaw

Payments to employees or requirement to

purchase goods, products or services

by an employee

The bill proposes the insertion of a new section 33A, which in the scheme of the BCEA is placed just after section 33 (information about remuneration) and before section 34 (deductions).

The proposed section 33A reads as follows:

Section 33 – Prohibited Conduct

(1)An employer may not-

(a)require or accept any payment by or on behalf of an employee in respect of the employment of, or the allocation of work to, any employee;

(b)require an employee to purchase any goods, products or services from the employer or from any business or person nominated by the employer.


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(2)Sub-section 1(b) does not preclude a provision in a contract of employment or collective agreement in terms of which an employee is required to participate in a scheme involving the purchase of specific goods, products or services, if-

(a)the employee receives a financial benefit from participating in the scheme;

(b)the price of any goods, products or services provided through the scheme is fair and reasonable; and

(c)the purchase is not prohibited by any other statute.


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Purpose of Section 33A?

It seems that this provision is aimed at avoiding incidents of bribery or corruption associated with either the employment of persons or the allocation of specific work to them.

The section also prohibits any compulsion on an employee to buy goods, products or services from his or her employer unless:

  • such a scheme is financially beneficial to the employee;

  • the price is fair and reasonable; and

  • the purchase is not prohibited by any other statute.


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Prohibition of work by children

The Bill proposes amendments to the provisions of sections 43 to 47 of the Act.

Amendment to section 43

The proposed amendment to this section reads as follows:

“Prohibition of [employment of] work by children

(1)No person may [employ] require or permit a child to work, whether as an employee or as an independent contractor, if the child –

(a)[who] is under 15 years of age; or

(b)[who] is under the minimum school – leaving age in terms of any law, if this is 15 or older1.

1Section 31(1) of the South African School’s Act, 1996 (Act 84 of 1996) requires a learner to attend school until the last day of the year in which the learner reaches the age of 15 or the 9th grade, whichever is the first.


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(2) No person may [employ] require or permit a child [in employment] to perform any work or provide any services –

(a)that [is] are inappropriate for a person of that age;

(b)that place[s] at risk the child’s well being, education, physical or mental health or spiritual, moral or social development.

(3)A person who [employs] requires or permits a child to work in contravention of sub-section 1 or sub-section 2 commits an offence.

Comment

The proposed amendment tightens the prohibition against child labour either in the form of employment or independent contracting.


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The implication of these provisions is that:

  • it is an offence to employ a child during the year in which the child turns 15 unless he or she has completed the ninth grade;

  • any increase in the statutory minimum school leaving age in terms of educational legislation will automatically increase the minimum age of entry into the workforce;

    This provision also provides a basis for regulating the employment or contracting of children who are 15 years or older. This is consistent with the constitution which defines a child as someone who is under 18 years of age2.

    2 Section 28(3) of the Constitution


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Section 44 of the Act – [Employment] Regulations on work by children [of 15 years or older]

The current section 44 allows the Minister on the advice of the Employment Conditions Commission (established in terms of section 59(1) of the Act) to make regulations to prohibit or place conditions on the employment of children who are at least 15 years of age and are no longer subject to compulsory schooling in terms of any law.

The proposed amendment to this section is aimed at broadening its scope to cover children as employees as well as independent contractors. A new sub-section is proposed and provides as follows:

“Section 44(1A)

The Minister may, on the advice of the Commission, make regulations to give effect to South Africa’s international law obligations dealing with work by children”.


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Comment

The preamble to Act indicates that the purpose of the BCEA is:

“To give effect to the right to fair labour practices referred to in section 23(1) of the Constitution by establishing and making provision for the regulation of basic conditions of employment; and thereby to comply with the obligations of the Republic as a member state of the International Labour Organization; and to provide for matters connected therewith”.

The new proposed sub-section (1A) broadens the basis of interpretation of this particular section of the Act and allows the formulation or publication of regulations to give effect not only to South Africa’s status as a member state of the International LabourOrganisation, but more widely to give effect to “South Africa’s international law obligations” whatever that may be.


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The difficulty with the provision is that it is, from a consistency point of view, more effective to provide for the interpretation of the Act as a whole on the basis of South Africa’s obligations as a member state of the International LabourOrganisation and more generally to its international law obligations rather than to limit it to particular sections of the Act3.

Section 45 – Medical Examinations

This provision entitles the Minister, after consulting the Commission, to make regulations relating to the conduct of medical examinations of children who perform work. The existing provision limits the making of regulations in this regard to children who are “in employment”.

3See section 39 of the constitution which requires the consideration of international and foreign law in the interpretation of the Bill of Rights.


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Comment

Whilst the Minister may publish regulations in this regard, it must be kept in mind that in terms of section 90(3) of the BCEA the confidentiality of any medical examination conducted in terms of the Act is protected.

Section 46 – Prohibitions

The proposed amendment is as follows:

“Section 46 Prohibitions

It is an offence to-

(a)assist [an employer to employ] any person to require or permit a child to work in contravention of this Act; or

(b)discriminate against a person who refuses to permit a child to [be employed] work in contravention of this Act”.


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Comment

The proposed amendment to this provision like those to sections 44 and 45 is to broaden the scope of its applicability to children.

Section 46 is a curious provision because it makes it a criminal offence for any person to discriminate against a person who refuses to permit a child to work in contravention of this Act. This aspect of discrimination is converted into a criminal offence but it has not been translated into actions that may be justiciable in terms of the Employment Equity Act or the Labour Relations Act. It is possible however that such discrimination may be justiciable in terms of those Acts on the basis of an unspecified ground.

The purpose of this provision, according to Benjamin, is aimed at a situation in which pressure is placed on employees, such as a farm workers, to allow their child to work for their employer.


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Section 47 – Evidence of Age

This provision deals with issues relevant to the evidence of age of the child and provides as follows:

“Section 47- Evidence of Age

In any proceedings in terms of this Act, if the age of [an employee] any person is a relevant factor for which insufficient evidence is available, it is for the party who alleges that the work by that person [employment] complied with the provisions of this chapter to prove that it was reasonable for that party to believe, after investigation, that the person was not below the permitted age in terms of section 43 or 44”.

Comment

The proposed amendment to this section of the Act is aimed at broadening the scope of its application to children who are employed or independently contracted.


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Making a Sectoral Determination

The Bill proposes fundamental amendments to section 55 of the Act. The broad principles of this section are as follows:

  • The Minister is entitled to make a sectoral determination, after considering the report and recommendations of the Commission, for one or more sector and area. (Section 55(1));

  • The sectoral determination may regulate a range of matters concerning remuneration or other terms or conditions of employment4, such as:

    • set minimum terms and conditions of employment including minimum rates of remuneration;

    • provide for the adjustment of minimum rates of remuneration;

      4 See section 55(4)


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  • regulate the manner, timing and other conditions of payment of remuneration;

  • prohibit or regulate payment of remuneration in kind;

    • require employers to keep employment records;

    • prohibit or regulate task based work, piece work, home work and contract work;

    • regulate any other matter concerning remuneration or other terms or conditions of employment.


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Section 55(4)(b)

The proposed amendment reads as follows:

“(4)A sectoral determination may in respect to the sector and area concerned-

(b)provide for the adjustment of remuneration by way of –

  • minimum rates; or

  • minimum increases of remuneration”.

    Comment

    This sub-section is perhaps the most fundamental amendment of the BCEA and allows the Minister to make a sectoral determination not only setting the minimum wage as it is usually referred to, but also providing for minimum increases of remuneration.


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Section 55(4)(g)

The proposed amendment reads as follows:

“(4) A sectoral determination may in respect to the sector and area concerned-

(g)provide or regulate task-based work, piece work, home work, sub-contracting and contract work.”

The insertion of the word “sub-contracting” is aimed at dealing with all possible forms of a-typical employment.

Section 55 (4)(o) and section 55(4)(p)

These are new provisions that will be inserted after the general provision in subsection (n). The proposed amendment will amend the current provision as follows:


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“(4) A sectoral determination may in respect to the sector and area concerned-

(n)regulate any other matter concerning remuneration or other terms or conditions of employment;

(o)taking into account the consideration set out in section 21(8) of the Labour Relations Act, 1995 set a threshold of representativeness within a sector at which a trade union automatically has organizational rights contemplated in sections 12 and 13 of the Labour Relations Act, 1995 in respect of all workplaces covered by the sectoral determination regardless of their representativeness in any particular workplace.

(p)Establish for the purpose of section 4(3) of the Land Reform (Labour Tenants) Act, 1996 (Act No. 3 of 1996), one or more methods for determining the value for labour tenants of a right to occupy or use part of a farm as contemplated in section 3 of that Act”.


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Comment

Setting the threshold of representativeness and enabling automatic organizational rights in undefined sectors with reference to section 21(8) of the LRA Act is interesting. What that section provides is the resolution of a dispute as to whether or not a registered trade union is a representative trade union in a particular workplace for the purposes of awarding organizational rights to that trade union.

If the Commission is called upon to arbitrate such a dispute, it must arrive at a decision in accordance with the parameters set out in that section, in the context of a ‘sector’ as opposed to a ‘workplace’ bearing in mind the injunction to curb union proliferation.


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What that sub-section also indicates however is the ability of the Commission to withdraw any of the organizational rights conferred if that particular trade union has ceased to be a representative trade union. It would be interesting to see how a regulation issued in terms of this sub-section establishes:

  • How the threshold is met?

  • How competing trade unions will be granted automatic organizational rights in circumstances where they may conceivably have representation in certain workplaces higher than in other work places but the section allows the awarding of organizational rights on an automatic basis if a threshold in the sector is obtained.


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  • As indicated, the resolution of any disputes in relation to representivity for the purposes of organizational rights is aimed at seeking the minimization of the proliferation of trade union representation in a single workplace. How the Minister translates that for the purposes of a ‘sector’ is going to be particularly interesting;

  • This new subsection is in fact premised on section 19 of the LRA which provides as follows in respect of established councils who have jurisdiction in specified sectors of the economy:

    “Registered trade unions that are parties to a council automatically have the rights contemplated in sections 12 and 13 in respect of all workplaces within the registered scope of the council regardless of their representativeness in any particular workplace”.


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  • The insertion of sub-section (p) is significant for employees in the agricultural section because it enables the Minister to provide a value of employees’ rights to tenancy on the employer’s farm. This information could be used for a variety of reasons, such as, to determine what the nature of that benefit is for the purposes of claims against that particular employer.

    The insertion of a new sub-section 8 – section 55(8)

    This new sub-section provides as follows:

    “Subject to the provisions of sub-section 7, the Minister may publish a sectoral determination that applies to employers and employees who are not covered by any other sectoral determination”.


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Sectoral determinations provide a basis for developing sector specific basic conditions of employment for unorganized sectors. A sectoral determination may not-

  • cover employees and employers bound by a bargaining council agreement;

  • regulate a matter in respect of which a statutory council has concluded a collective agreement5.

    The new subsection 8 effectively entitles the Minister to publish a sectoral determination that covers employees and employers:

  • who may fall under the jurisdiction of an existing bargaining council or statutory council but where no collective agreement has been concluded by parties to those councils.

    5 Section 55(7)(a) and (b)


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    Enforcement Mechanisms of the Act

    • do not fall under the jurisdiction of a bargaining council or statutory council.

      If you read sections 55(7), the new proposed section 55(8), together with the proposed amendment to the definition of ‘sector’ it is certainly arguable that the Minister is entitled to make sectoral determinations that apply across industries. The proposed amendment to ‘sector’ provides as follows:

      “sector’ means an industry or a service or part of an industry or service and, in respect of a sectoral determination made in terms of section 55(8), means the employers and employees covered by that determination.”


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    Enforcement Mechanisms of the Act

    The Bill provides for fundamental amendments to the enforcement mechanisms of the Act provided for in sections 68, 69, 70, 71, 72, 73, 74 and 77 of the Act.

    The new regime deals with contravention of the BCEA like a traffic offence.

    Section 68 – Compliance Order

    The BCEA currently gives labour inspectors the power to enforce its provisions through the issue of compliance orders. The principle features of this process are-

    • the requirement to secure an undertaking from the relevant employer;

    • issuing compliance orders;

    • objection procedures;

    • appeals and thereafter applications to the Labour Court.


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    An inspector may issue a compliance order in terms of the current provisions-

    • if the inspector has sought to obtain a written undertaking from the employer to comply with its obligations and the employer has failed or refused to give the undertaking; or

    • the employer has given a written undertaking but has not complied with it6.

      Section 68(1) was accordingly premised on the requirement that any enforcement mechanism could only apply if the labour inspector endeavoured to secure a written undertaking by the employer to comply with its obligations in terms of the Act. The proposed amendment to Section 68(1) of the Act gives the labour inspector a discretion as to whether of not to secure a written undertaking by the employer. The proposed amendment reads as follows:’

      6Section 68(1) and (9)


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    “Section 68(1) –

    A labour inspector who has reasonable grounds to believe that an employer has not complied with any provisions of this Act [must] mayendeavour to secure a written undertaking by the employer to comply with the provision”.

    Insofar as the labour inspector endeavours, nonetheless, to secure a written undertaking by the employer, the provisions of sub-section (1A) and sub-section (2) will apply. These provisions simply require the labour inspector to secure a written undertaking by meeting with the employer or serving a document on him in prescribed form that informs him of his non-compliance and the extent of it.

    In terms of sub-section 2, the labour inspector may seek to obtain agreement between the employer and the employee as to any amount owed to the employee and arrange for payment to an employee in terms of that undertaking.


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    The section is amended by the insertion of a new sub-section 3 which provides as follows:

    “Sub-section 3-

    If an employer fails in full or in part to comply with a written undertaking given by it in terms of this section, the Director General may apply to the Labour Court for an order in terms of section 73 directing the employer to comply with the undertaking”.

    This section accordingly provides for the enforcement of any breaches of undertakings given, directly to the Labour Court.


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    Section 69 – Compliance Order

    This section operates independently of the amendments to section 68 and does not require an undertaking from the employer.

    In terms of the current provisions of this section, a labour inspector who has reasonable grounds to believe that an employer has not complied with the provision of the Act may issue a compliance order that must set out a range of information including the details of the employer, the location of the workplace, the provision that has not been complied with, any monetary amount owing to the employee and any written undertaking by the employer in terms of section 68.

    In particular section 69(2)(d) provides that a compliance order must set out-

    “Any written undertaking by the employer in terms of section 68(1) and any failure by the employer to comply with a written undertaking”.


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    The above provision is deleted.

    In addition, sub-section (2A) as a new provision has been inserted and provides as follows:

    “A compliance order may, in addition, set out –

    • The date by which the employer should serve any representations it may wish to make with the Department and the Labour Court;

    • The date on which, if the employer does not comply with the order, application may be made without further notice to the employer to have the compliance order made an order of the Labour Court in terms of section 73”.


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    In the event that there is non-compliance with a compliance order, the Director General may apply directly to the Labour Court for an appropriate order with due regard to the employer’s right to serve any representations it may make in relation to the matter It is a short, sharp and effective enforcement mechanism.

    It is however unclear, whether such an application (especially if it is unopposed), will be heard before the Labour Court or whether it will be decided upon by a Judge in Chambers. Either way, it seems that the Labour Court will need to design a specific strategy to deal with such issues and to ensure a fast and expeditious system in relation to this matter.

    The further amendments to sub-sections 3 and 5 of this section are linguistic and simply require service of the compliance order on the employer and to each employee affected or to the employee’s representative.


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    Section 70 – Limitations

    This section currently provides that a compliance order may not be issued if:

    • the employer and employee are covered by a collective agreement providing for resolution of disputes in terms of the BCEA by arbitration (section 70(a));

    • the employee is a senior managerial employee or earns in excess of the statutory threshold set by the Minister in terms of section 6(3) (section 70(b));

    • the employee has instituted legal proceedings to recover the outstanding amount (section 70(c)); and

    • the amount has been payable by the employer to the employee for longer than 12 months before the employee lodged a complaint, or if no complaint is lodged the date on which the inspector attempted to secure a written undertaking (section 70(d)).


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    The provisions of 70(c) are aimed at achieving clarity of that limitation and provides as follows:

    “Sub-section (c)

    Any proceedings have been instituted for the recovery of that amount [or, if proceedings have been instituted] , unless those proceedings have been withdrawn;”

    The amendment to section 70(d) is simply to remove the requirement of a written undertaking by the employer in terms of section 68.


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    Section 71 and 72 – Objections to compliance order / appeals from order of Director General

    These provisions have been deleted. Given the approach to the enforcement of compliance orders, there will no longer be a process for an objection process or an appeal process from the Director General’s order. Any disputes in this regard will now be dealt with by the Labour Court.

    Section 73 – Order made by the Labour Court

    The amendments to section 73 of the Act are aimed at achieving the adjudication of compliance orders by the Labour Court. The proposed amendment read as follows:


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    “Section 73

    (1)The Director General may apply to the Labour Court on the date specified in the compliance order in terms of section 69(2A)(b) or, with further notice to the employer on a subsequent date for a compliance order to be made an order of the Labour Court [in terms of section 158(1)(c) of the Labour Relations Act 1995] if the employer has not complied with the order [and has not lodged an objection against the order in terms of section 71(1)].

    (2)[The Director General may apply to the Labour Court for an order… in terms of section 71(3) to be made an order of the Labour Court in terms of section 158(1)(c) of the Labour Relations Act, 1995, if the employer has not complied with the order and has not appealed against the order in terms of section 72(1)]. After considering any representations made to it, the Labour Court may issue an order in terms of sub-section (1) requiring-


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    • the employer to comply with any provision of this Act;

    • subject to section 70(d), the payment of any amount owing to an employee;

    • the payment of a fine calculated in terms schedule 2 of this Act”.

      The amendment to schedule 2 is as follows:


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    Consolidation of proceedings and

    Jurisdiction of the Labour Court

    An employee generally may choose to recover any amount owing to him or her in terms of the BCEA –

    • by making a claim in the Civil Courts and in the Labour Court (section 77(3);

    • if the employee has been dismissed, by instituting the claim jointly with proceedings in the Labour Court or in arbitration proceedings concerning the fairness of the dismissal. This claim is restricted to amounts that have not been outstanding for longer than 1 year (section 74 (2)).


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    Section 74(2) (in its current form) does not explicitly state from when the period of 1 year is calculated. One arbitration award rejected a claim because it had been outstanding for 1 year prior to the date of the arbitration7, and in another award it was held that the arbitration is entitled to hear claims that arose in the year prior to the date of dismissal of the employee8.

    The proposed amendment extends the period of the claim and in this regard the amendment to sub-section 2 provides as follows:

    7 Weller v Group 6 Security Services (Pty) Limited (2001) 22 ILJ 1275 (CCMA)

    8 Motaung v Issa (2007) 28 ILJ 1351 (CCMA)


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    “Section 74 (2)

    If an employee institutes proceedings for unfair dismissal, the LabourCourt or the arbitrator hearing the matter may also determine any claim for an amount that is owing to that employee in terms of this Act if the claim has not prescribed. No compliance order may be issued or enforced and no other legal proceedings may be instituted or enforced in respect of any claim that has been determined in terms of this sub-section.

    [(a) a claim is referred in compliance with the Labour Relations Act, 1995;

    (b)the amount has not been owing by the employer to the employee for longer than 1 year prior to the dismissal; and

    (c)no compliance order has been made and no other legal proceedings have been instituted to recover the amount]”.


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    Section 77 jurisdiction of the Labour Court

    According to the explanatory memorandum, the jurisdiction of the Labour Court is clarified by specifying that it has jurisdiction to grant civil remedies (such as interdicts) in respect of matters which are criminal offences. This clarifies that the Labour Court can, for instance, interdict an employer from requiring children to work in breach of the child labour provisions of the Act. The exclusion of certain sections from the jurisdiction of the Labour Court has now been transformed into inclusions. The proposed amendment provides as follows:

    “Section 77 (1)

    Subject to the Constitution and the jurisdiction of the Labour Appeal Court and except where this Act provides otherwise, the Labour Court has exclusive jurisdiction in respect of all matters in terms of this Act [except in respect of an offence specified in sections 43, 44, 46, 48, 90 and 92].


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    Section 77(1A)

    The Labour Court has exclusive jurisdiction to grant civil relief arising from a breach of sections 33A, 43, 44, 46, 48, 90 and 92”.

    Finally, the bill proposes the amendment to section 93 which deals with penalties. Offences and penalties in respect of the following provisions have been increased:


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    Offences and Penalties


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