Employee Termination, Asset Impairment and Other Charges

The Company recorded the following charges related to employee terminations benefits, asset impairment, and other charges:



	Three Months Ended				Six Months Ended
	December 28, 2018		December 29, 2017		December 28, 2018		December 29, 2017
	(in millions)
Employee termination and other charges:
Restructuring Plan 2016	$	—	$	32	$	—	$	77
Closure of Foreign Manufacturing Facilities	7		—		11		—
Business Realignment	13		16		55		23
Total employee termination and other charges	$	20	$	48	$	66	$	100

Closure of Foreign Manufacturing Facilities

In July 2018, the Company announced the closing of its HDD manufacturing facility in Kuala Lumpur, Malaysia, in order to reduce its manufacturing costs and consolidate HDD operations into Thailand. The Company now currently expects the closure to be substantially completed by the fourth quarter of fiscal 2019 and to result in total pre-tax charges of approximately $110 million. These charges are expected to consist of approximately $70 million in employee termination benefits and $40 million in asset-related, contract termination and other charges, of which $56 million were recognized in the year ended June 29, 2018. During the six months ended December 28, 2018, the Company recognized an additional $3 million in employee termination benefits and $8 million in asset-related, contract termination and other charges.

The following table presents an analysis of the components of the restructuring charges, payments and adjustments made against the reserve during the six months ended December 28, 2018:



	Employee Termination Benefits		Contract Termination and Other			Total
	(in millions)
Accrual balance at June 29, 2018	$	56	$	—		$	56
Charges	3		8			11
Cash payments	—		(5		)	(5		)
Accrual balance at December 28, 2018	$	59	$	3		$	62

Business Realignment

The Company periodically incurs charges as part of the integration process of recent acquisitions and to realign its operations with anticipated market demand. The following table presents an analysis of the components of the activity against the reserve during the six months ended December 28, 2018:



	Employee Termination Benefits			Contract Termination and Other			Total
	(in millions)
Accrual balance at June 29, 2018	$	36		$	7		$	43
Charges	46			9			55
Cash payments	(35		)	(5		)	(40		)
Accrual balance at December 28, 2018	$	47		$	11		$	58