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Have No Fear! Your Handbook is Here!

EmployeeHandbook_Pop_6467Dear Kathleen,

We are a growing company and have an employee handbook that is several years old. It’s not been updated and has policies that are no longer followed. We would really like to update the handbook but are hesitant to do it ourselves due to the legal repercussions and risks.

Sincerely,
Jonathan from Dahlonega, GA

Dear Jonathan,

Keeping your employee handbook up to date is one of the most important things you can do to reduce the risk for your company. An effective and well-written employee handbook is the foundation of your employees’ success. Additionally, it provides the safest protection for the employer.

The handbook provides standards, expectations, declares employer rights, highlights employee rights, and offers a written employee acknowledgement for all standard practices relating to the employees. One of the most important roles a handbook can play is to preserve the at-will nature of employment.

Employee handbooks also improve communications between employers and employees. A carefully drafted employee handbook can act as an effective motivational tool and it can provide employees with a company history, set forth the company’s objectives and core values, and explain what role each individual employee plays in achieving company-wide goals.

Depending on how old your handbook is, it might be best to start from scratch. Putting together a handbook requires a thorough analysis of written policies, known but unwritten policies, and knowledge of all policies that are required by city, state, and federal laws. Your handbook should also be in alignment with and reflect your company’s policies and culture.

Although this process can be daunting, you will still need to start somewhere. My suggestion would be to only start with your own internal policies and not to worry too much about the legally mandatory policies yet. The legally mandatory policies will need to be particularly precise and conform to the related laws. Because of this, these policies need to be created by a qualified and experienced person.

Make your task easier by following these steps:

1.Start only with an outline of the policy subjects you have clear views on, such as smoking, benefits, social media, technology, etc.

2.Look through your old handbook and determine what you need to keep, versus what should be discarded or changed.

3.Conduct internal discussions to get feedback from management about what should be included in the handbook.

4.For each of the handbook subjects you still need to determine, simply create bullet points of your requirements and don’t waste too muchtime trying to write them completely yourself. Remember that the person you hire will re-write your handbook but having an outline is always a good starting point.

I do not suggest that your employee handbook be created internally. Even experienced corporate attorneys are not familiar with employment law and handbooks, so even they would not be your best choice for creating a new handbook. Externally, you do have a few good choices, some more expensive than others: you can hire an employment attorney to create your handbook, or you can hire a Human Resources consultant who is experienced in creating employee handbooks.

If you decide to hire an employment attorney, your cost may be upwards of $10,000, depending on how many states your company operates in. If you hire an HR consultant, you may be able to get a flat fee handbook and he or she may be able to include an “attorney review” in the fee. This option offers you comfort because you know that the content has been “blessed” by an attorney that the HR consultant works with. Plus, this option gives you the opportunity to ask as many questions as you like without the fear of an hourly charge. You can also have an HR consultant create the handbook and then have your own employment attorney review it.

One thing to remember is that creating an employee handbook is extremely time consuming and it takes multiple meetings, calls, questions, and lots of communication. You can expect that a good employee handbook will take a few months to complete, so patience is vital. Once your employee handbook is finalized, sit with your contractor to make sure that you know each and every policy in it so that you can clearly explain the policies to your own employees. Your employees will have questions for you, so it’s important that you know the handbook from front to back—including all the legally mandated policies.

Make sure to incorporate your handbook into each new employee orientation meeting and obtain a signed acknowledgment form. In the end, your handbook will become a continually changing and evolving tool that guides your company and provides a strong foundation for your employees. A well-created employee handbook assists employers to reduce risks, streamlines the answering of frequently asked questions, and sets the tone for your company culture and rules.

Good Luck!

Kathleen

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Vacation Time? Too little or too much?

Dear Kathleen,
I am the HR manager for a company of 85 people. As I am starting to get into the details of the department, I am discovering that because of poor record keeping, many of our employees have large deficits with their vacation time. Some are several weeks “in the hole” and the process has not been managed very well. On the other hand, we have other employees that have so much vacation that it will be very difficult to use it all and it just keeps accumulating. How do we rectify this situation?
–Bob, New Orleans
clock-beach
Dear Bob,
Thank you for your question. There are a few things you can do to remedy the situation but in the end, it comes down to the right policy for your company. First, for all those employees who have an abundance of vacation time; why not give them a one-time buy out for any vacation time in excess of one or two weeks? This way, if someone currently has four weeks of vacation, they can essentially “cash in” one to three weeks, or whatever you determine to be fair.
I assume from your question that you do not have a rollover maximum of vacation time. Remember that if you have many employees with large amounts of vacation accrued and no end in sight, that’s a big liability. For example, if your employees make an average of $30.00 per hour and half of your employees have five weeks of vacation time carrying over at the end of year to the next year, that’s almost a quarter of a million dollars in liability.
The way to reduce that liability is to rectify the current situation and bring vacation balances down to reasonable levels. Then, create a policy that works for your company, limiting carry-over vacation. A suggestion might be to only allow two weeks of vacation to carry over from one year to the next. Most people would agree that it is a fair amount. In the meantime, give employees notice well in advance of the policy changes so that they have time to take their excess vacation time without forfeiting it. You will have some employees who cash out their vacation, and some who will have enough flexibility to use their vacation before the policy changes take effect, but in the end, your company will get that vacation time down to reasonable levels.

Regarding the employees who have a large vacation deficit, correcting that also starts with creating a policy where employees will no longer be able to take time off if they do not have any available. I do not suggest that you forgive any remaining balances as that would be unfair to those who have followed the rules. Instead, employees with a deficit should understand that all time taken off will be unpaid until new time is accrued. The only issue you may have with this solution is with your exempt employees, but as a general rule, you can make deductions from pay if the exempt employee takes the whole day off, as long as it’s not for illness or a disability. See this document for more information on that. If you have a sick time policy, you can also allow employees to pay down their deficit with their available sick time.
Moving forward, there is always an exception to the rule, so I would not completely forbid employees from going into the hole with their vacation time. As long as advance vacation is kept to a minimum of a day or two, and as long as your employees sign a release agreeing to allow a payroll deduction in the event they leave the company, compromise is possible.

It might also be a good idea to consider a PTO plan versus a vacation and sick time plan. It creates efficiency and makes it less likely that employees will call in sick unexpectedly. As a final note, make sure to communicate your new policy clearly so that all employees understand your timeframes, the remedy for their particular situation, and the details about the new policy going forward. If everyone is on the same page, you’ll have less difficulty implementing the changes.
Good luck!

Kathleen

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Performance Push Back? What’s the big deal? part II

Dear Readers,
Last month we addressed the benefits of performance reviews. This month, let’s talk about some quick “Do”s and “Don’t”s that will help managers conduct meaningful and productive reviews.
Do!
•Be prepared. You don’t want your employee to feel like his or her review is not important and is something you have just thrown together.
•Consider both time and place. Pick a quiet place where there are no interruptions and allow sufficient meeting time for you and the employee to address all issues.dos-and-donts
•Recognize the reality of top ratings/length of service. Be aware that length of service does not always equal or constitute a higher rating—and make that clear to your employee if necessary.
•Give balanced feedback. Start with good feedback, then address anything negative, and always end on a positive note.
•Be as specific as possible. Instead of saying, “You’re not doing a good job,” be more specific. A better comment would be, “We’ve had three customer complaints in the last two weeks regarding your lack of follow-up.”
•Focus on the job, not the person. Never make it personal. Your comments should only be job and performance related. As difficult as it may be, managers need to set aside their personal likes and dislikes and only focus on job performance.
•Keep it a two-way discussion. Make sure you don’t do all the talking. Ask open-ended questions and allow the employee to provide feedback and ask questions.
•Share ideas for improvement. If you have ideas on how the employee can improve, by all means share them!
•Identify future aspirations. Make sure to ask and understand what the employee sees for themselves in the future.
•Summarize and review the important points. Summarizing important points ensures you are both on the same page and that you have the same understanding of the conversation.
•Restate goals, action steps, and time-frames. This should be done in writing.
•Reassure the employee. Make sure the employee knows that he or she is not alone and has support from you as their manager, as well as from others on the team.
•Allow 24 hours for employee comments and signature. Allow each employee to make comments and return the signed review to you within 24 hours.
•Clarify that the employee’s signature does not signify agreement. Especially with a challenging review, it’s important that the employee knows that his or her signature on the review does not necessarily indicate that he or she agrees with all that was said. A signature verifies that a copy was received.
•Write in clear, full sentences. When you write a review, make sure a stranger could understand what you are trying to communicate. You may not always be the employee’s manager and there is nothing more frustrating than trying to decipher cryptic comments from a previous manager.
•Ask your employee ahead of time for an update on his or her goals and performance accomplishments. This will help you get an idea of his or her perspective prior to your meeting.
•Follow up. There’s nothing worse than a manager who only has performance discussions once or twice a year. Make sure you follow up and keep the conversation going!
Don’t!
•Don’t wait until the last minute! Each employee is deserving of an accurate and thoughtful performance review.
•Don’t try to avoid your own pain. Sometimes conversations can be difficult and as humans, we try to avoid them. This isn’t the time to avoid those painful discussions, however you should be sure to also include positive feedback.
•Don’t go solely by memory. No one can remember everything. Make notes throughout the year.
•Don’t rush. Take your time. The last thing you want to do is have the employee lose respect for you or feel disrespected. If you rush, it will imply that the employee’s review is not important to you.
•Don’t be afraid to provide truthful and factual information. Sometimes the truth hurts but in many cases the discussion seems to hurt the manager more than the employee. Get over that fear. Employees appreciate honesty and usually are expecting your constructive comments.
Avoid Biases and Pitfalls
Performance reviews are tough enough even when you don’t run up against errors on your end. Keep these common biases and pitfalls in mind as you’re preparing for each review.
•Contrast errors: Don’t compare the employee against other employees. Compare the employee against the standard.
•Halo Effect” or “Horn Effect”: Don’t appraise based on perceived positive or negative quality or if you like the employee. Appraise based on actual performance. You won’t like everyone and this practice keeps your reviews objective.
•Excessive stiffness or lenience / central tendency: Pay attention to your own patterns. Are you always too strict (or too lenient)? Do you rate everyone as average?
•“Spillover Effect” or “Recency Effect”: Don’t rate an employee based the performance from the far past or based on the most recent behavior. Instead, consider the entire appraisal period.

Hopefully, these tips will help you become a more effective manager and will increase your ability to conduct really meaningful performance reviews every time.
Good luck to you in your reviews. Remember: “Your company is only as good as your people.”
Kathleen Weiss, SPHR, Director of Human Resources

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Performance Push Back? What’s the big deal?

hands-up-no-way-stop-e1351285294963-600x337[1]Dear Kathleen,

I just started working for a company with about 75 employees. I am getting a lot of pushback from managers who do not want to conduct performance reviews for the employees. What is the best way to explain the benefits of the performance reviews?

-Leila from Garden City, Kansas

Dear Leila,

I understand the pushback and have experienced it myself many times over many years. I hate to say this, but most managers give you pushback not because they want to make the process better but because they hate having hard conversations, are lazy, don’t think they need them, feel they don’t have time, and they think there is no value. I would say these are all ridiculous excuses. The truth is that performance reviews have tremendous value, if they are done right.

If your company is sued by a former employee, the first thing that will be asked for by attorneys for both sides will probably be the performance reviews. These claims can run from discrimination to harassment, whistleblower, and others. The EEOC’s 2013 report states, “The EEOC obtained a record $372.1 million in monetary relief for victims of private sector workplace discrimination in FY 2013. This is $6.7 million more than was recovered last year, and the highest level obtained in the Commission’s history. Overall, the agency secured both monetary and non-monetary benefits in FY 2013 for more than 70,522 people through administrative enforcement activities including mediation, settlements and conciliations.” This is a serious threat to your company that the managers must be aware of.

Performance reviews are one of the most powerful protections an employer has against employee-related lawsuits. It helps you to prove non-discriminatory termination decisions, as well as claims that can be brought against the company regarding pay inequity and other benefits such as training and promotions. Remember, anytime an employee calls the EEOC, you can count on a very lengthy investigation. Management should know that employees win an average of 77% of employee-related litigation cases. Performance reviews can lay the legal groundwork for terminations, if necessary.

In addition to being the first line of defense for litigation, everyone benefits from meaningful feedback from their boss. There is nothing worse for an employee than to be fired or reprimanded for something they were not told about. As managers, we must give every employee the opportunity to live up to the expectations of the job and that involves clear feedback and documentation.

Performance reviews are a time not just for managers to talk to their staff but also for the staff to give feedback on ideas and personal goals that they may have as well. It’s a time for both to discuss challenges, training opportunities, future goals, and how they fit in to the department and company as a whole. Every employee needs and deserves undivided time from their manager.

In essence, performance reviews provide a system by which to determine salary increases and job promotions. They help determine needed changes for behavior, job skills, and attitude. They do a lot.

I hope this helps you to relay to your managers how important performance reviews really are.

Kathleen

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Are They Really Sick?

Q – Dear Kathleen: Our company has a vacation policy and a sick time policy. We offer our   employees six sick days per year and they are not allowed to carry over any sick days to the following year. They have to use it or lose it. As you can imagine, the employees always exhaust their sick time. We have had suspicions on many occasions that employees have not actually been “sick,” but have called in sick for personal reasons. How do we manage this and make sure they are calling in for a legitimate illness? Bob R., CEO – Advertising Company, Newark

A – Dear Bob: The answer to your question is – there is no way to make sure employees calling in sick are actually sick. It’s not surprising that your employees take all their sick time during the year. The Federal Bureau of Labor Statistics reports that 42 percent of all workers in private industry are not entitled to sick time. For those who are, paid sick time is viewed as an entitlement to the employees and most do take all the time allowed – and call in at the last minute. Sick pay banks, especially the “use it or lose it” kind, are a haven for deception. Statistics show that, on average, only 34 percent of employees calling in “sick” are actually sick. The other 66 percent take off for personal reasons. Employees who call in under the guise of being sick, call in at the last moment to support their story of illness. This causes undo strain on the daily functions of a business. Managers have to scramble to reschedule work activities, other employees must unexpectedly pitch in, work is delayed, and, many times, customer service suffers. As long as employers offer “sick time” banks, the problem of the last minute scramble will always be there. So what do you do? Many companies are switching from a traditional vacation and sick time banks to one “Paid Time Off” (PTO) bank. PTO banks are gaining huge popularity due to the win-win situation for employee and employer. A work-life balance is of growing importance; PTO policies offer employees one bank of paid time to be used for illness, family matters, vacation or whatever they like. They no longer have to worry about manufacturing an illness excuse to earn their sick day. It gives them the freedom and flexibility to schedule their time off without worry.

For the employer concerned about employee retention, this flexibility is a significant benefit to the employee and can be used as a tool in the hiring and retention process. A PTO policy typically reduces man -hours and offers less administrative hassles with only one time off bank to manage. If employees are given PTO instead of vacation and sick time, they are more likely to schedule their time off in advance. As a result, PTO offers the company more control in the approval process. PTO allows companies to better manage the day-to-day business needs without as many last minute “no-shows,” and keeps up productivity since work arrangements can be pre-scheduled. The employer no longer needs to worry if the employees are being honest about their time off. It’s really a win-win situation for both employee and employer!

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Probation? Should we?

Q- Dear Kathleen: We have a policy that states employees are given a probationary period when they are

first hired. We have an employee who just passed his 90-day probationary period, but now we want to terminate him. Our management is concerned that we should have done this before his 90-day probationary period, but they were so wrapped up in the day-to-day business that the probationary period was overlooked. What should we do now?

A- I would guess by your policy that you have a very outdated handbook. Because almost all states comprise some version of an at-will state, probationary periods have gone by the wayside. At-will means that the employee and employer may terminate the employment arrangement at any time, with or without cause. This is the case, unless you make promises or implied promises, such as in your handbook.

Without reading the exact policy, the first thing I would suggest is that you update your employee handbook to reflect the current HR and legal best practices, state and federal laws, and eliminate the probationary period. An employee handbook is an employer’s first defense against legal action and is an absolute MUST. This is a “living” document that should be reviewed at least annually to make sure it reflects the current laws and your company’s business practices.

Assuming you are in an at-will state, you can terminate the employee for any reason other than a discriminatory reason, unless you have made a promise or contract otherwise. If you want to terminate this employee because of performance issues, I suggest that you Document! Document! Document! Start progressive discipline immediately; record all performance problems to date and have a discussion with the employee regarding where he is failing in his job performance. Document all the specifics, facts and pertinent conversations, and convey the consequences for not improving within a specific time period.

The last thing you need is to terminate this employee and then be faced with a lawsuit. Employees win approximately 71 percent of all employment related lawsuits. Even if your company is completely in the “right,” it will cost you to make him go away. It is vitally important, now more than ever, that employers have a savvy and knowledgeable person heading their human resources function – or educate themselves on the current federal, state and local laws so they are not in the position your company is in now.

In most cases, if an employee is given specific guidelines and goals for job performance when they are first hired AND they receive continual feedback from management, you have a much more productive and engaged workforce. Through progressive discipline, you give the employee the opportunity to correct the performance issues. You never know; he just may live up to your expectations!

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HUD Zone Hiring to Avoid Discrimination

Dear Kathleen:
I need to hire, but to qualify for HUD zone, I need to hire people who live in two specific towns near my business. Can I run an ad saying that only those who live in these two cities need apply? Am I opening myself up for lawsuits?

Thanks,
Todd A.

Dear Todd:
Well, it’s a little complicated, but here’s your answer. I wouldn’t specify an area requirement in an advertisement to the world, but you can screen for candidates who are most advantageous to your business model as long as your hiring practices do not discriminate against a protected class. In the end, you may not have a problem, but it’s always good to err on the side of caution.

Here’s the issue. If the area you are targeting is primarily made up of Caucasians and very few African Americans, you could be accused of “disparate treatment” or “disparate impact” because your business practices may adversely impact members of a particular minority group. You can’t discriminate based on where a person lives because where they live may indicate their national origin and/or racial background, or a number of other factors.

Consider where you advertise. There are two ways to look at it. If you advertise in local papers, you may get you candidates from the areas that is most advantageous to your HUD status. However, if you advertise on Monster.com, for example, this ad will definitely cast a wider net and get you more qualified candidates. If you are hiring for entry-level positions or you think it may be important, you might want to include something about public transportation and mention your area.

In the end, you have to remember to hire based on the person’s qualifications for the job. As always, check with you employment attorney for legal advice.

Good luck!

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RSS Feeds for Federal and State Employment Law

Dear Kathleen:
I’m the HR manager for our company and also wear other hats. We have about 60 employees in our state and a few in other states. I am concerned about keeping up with what is going on with Federal and state laws. What is the best way to keep up to date?

Thanks,
Mary M.

Dear Mary:
The amount of information to keep up with for any HR professional is overwhelming. I spend at least two hours a week reading employment law update, law blogs and industry alerts. Still, even with that much dedication to stay current, I still get surprised.

For you, I’d start by joining the Society of Human Resources (SHRM) and their local chapter as well. There is a wealth of knowledge that comes from this organization. The website is chock full of toolkits, advice and updates on state laws, as well as message boards so you can connect with other HR professionals.

The local chapters usually have monthly meetings. You can to go SHRM.org to find the location nearest you. From my experience, some chapters are better than others, so if you have more than one near you, check each of them out before deciding on which one to join.

Another way I keep up with state and Federal employment law is through RSS feeds. I get at least 30 RSS feeds on a regular basis through “My Yahoo” account. It’s quite easy to do this once you find the feeds that appeal to you. Start by setting up your “My Yahoo” page, but you can also use Google, MSN, AOL and other aggregators if you may prefer. Then, by doing a web search for “employment law RSS feeds,” you’ll find dozens of employment law firms that issue RSS feeds for their articles. You can customize your list by changing your search terms to include the states you desire or other criteria important to you. Here are some I like to subscribe to:

The amount of information available is endless, but it does take a tremendous amount of dedication if you really want to have your finger on the pulse of employment law. The consequences are dire for those that ignore and proceed with business as usual. It’s not easy to keep up with the law, but it’s well worth it if you are faced with a lawsuit. If you’re not going to keep your company updated and in compliance, it’s best to have a trusted HR consultant and employment attorney available at hand.

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Innovative Ways to Change Your Working Environment

Dear Kathleen: 
Our company has gone through a lot of change in the last five or six years. Thankfully, we’ve grown tremendously, but now it seems as if our innovative culture is somewhat stuck in a rut. I’d like to get some ideas as to how to give everyone an uplift in attitude and innovative thinking.

Thanks,
Nancy B.

Dear Nancy:
One of the hottest and most cutting-edge components in business today is creating an innovative and creative workspace. The space around you affects mood and attitude tremendously, and employers are starting to realize this. The best companies to work for have taken a calculated and innovative foot forward when it comes to the company’s environment, perks, culture and workspaces, realizing that they are all tied together to discourage or promote productivity.

There are many things you can do at your company that can give the culture a revitalization toward innovation and collaboration; some can be expensive and some can be quite inexpensive.

As always, everything starts with your people, so when you hire, hire those who have the qualities that fit into your culture. Structure the interview so that identifying questions are part of that process.

Create workspaces that inspire. Remember the old Apple commercial with the IBM drones walking in single format? Yes, that’s what you want to avoid! A cheap and easy way to brighten attitudes is to brighten the office. Swap out traditional drab colors for bright splashes of color on the walls. Use colors that inspire and stimulate the brain versus the “mental institution green” commonly used to subdue the brain.

I recently found a fantastic product called Idea Paint. In my humble opinion, every office in the country should have this product. It’s a specialized paint that can make any wall or surface a whiteboard. The product is flying off the shelves to companies such as yours. Paint an entire wall in offices, hallways, the refrigerator or anywhere your staff need to collaborate or brainstorm. Find it here.

One of the best examples of a creative workspace is from Red Bull. If you haven’t seen this, it’s worth a look: Red Bull Office Slide. Red Bull has installed slides for employees to move from floor to floor in their multi-level office. I have to say it’s as cutting edge as you can get. Not every company has the money or space to install slides in their office, but here are some examples of what other companies are doing:

  • If you have wireless, allow employees to work in spaces other than at their same old desk. If you have access to outdoor space, set up areas for employees to work outside in the fresh air.
  • Arrange for spaces to be open and unobstructed, even if that means moving cubicles around and adding some open meeting spaces.
  • Install a climbing wall (Google).
  • Many companies now have free snacks and drinks.
  • Bring your dog to work days.
  • Convert an unused office to a company wellness room where employees can take naps on their lunch break, keep up with the news, watch a movie, or meditate and de-stress.
  • Offer health perks for gym memberships or have mini-gym in your offices.
  • Have creative team building events.
  • Free flu shots (Wegmans)
  • Free fruit on Tuesdays (Netapp.com).
  • Use online meeting services that incorporate webcams. GoToMeeting now has the beta version coming out to incorporate into their current web meeting software.
  • Reward and recognize creativity and innovation. If the company does not actively recognize these qualities, employees won’t strive for them.
  • Reward for referrals. Employees who work for you know the drill, so when they refer an applicant for an open position, most are pretty sure that they will be a good fit, especially if they themselves like working there. The apple doesn’t fall far from the tree, and referrals from employees have a lower turnover rate. Cisco topped the list as one of the best companies to work for; 47% of all new hires are from employee referrals.
  • Make the employees’ lives easier for little or no cost to the company. Negotiate costs for a weekly on-site car cleaning service or dry cleaning pickup. Even if the cost is on the employee, this makes life easier. As a result, employees are more likely to be productive and creative.
  • Meet in creative spaces. Check out the “conference bike.” http://conferencebike.com/
  • Use office flexibility. This product creates a temporary wall wherever you need it. http://grapedesign.dk/molo/softwall/textile-softwall/ Just roll or unroll as needed.
  • Add art. What a better way to inspire creativity? Art doesn’t have to be expensive but makes a huge difference in an office setting.

In the end, the movement toward creativity and innovations comes from the top. If your leadership values these qualities in its employees and this is communicated in the way your company works, you will in turn have that culture. It’s the “build it and they will come” philosophy. Good luck!

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