Restructuring

On September 15, 2014, the Board of Directors of the Company approved a management simplification restructuring plan ("Plan") that was subsequently communicated to Kelly personnel in October 2014. We expect to complete this Plan during the fourth quarter of 2014.

We began 2014 with a firm commitment to growth and a clear plan for accelerating Kelly's strategic priorities through significant investments in our PT specialties, our OCG practices and our centralized approach to servicing large customers. We have executed these investments on schedule, and the Plan now brings additional efficiency to our operating models across the organization by:


•	In the Americas segment:


◦	Streamlining our local U.S. field operations through the closure or consolidation of approximately 50 branches


◦	Simplifying our centralized large account delivery structure


◦	Simplifying our U.S. management structure


•	Continuing to align OCG resources more efficiently against areas that deliver rapid growth and return on investment


•	Optimizing our headquarters operations

Estimated headcount reduction related to the above actions is approximately 100 permanent positions across our global workforce, including several senior leadership positions that will be vacated at the end of December 2014. The headcount reduction related to the Americas segment is estimated to be 40 positions, OCG headcount is estimated to be reduced by 5 positions and corporate headquarters is estimated to be reduced by 55 positions.

Related to this Plan, we reported restructuring charges of $3.7 million, consisting entirely of severance costs, in the third quarter of 2014. These severance costs include contract termination costs of $2.9 million and substantive plan costs of $0.8 million. Subsequent restructuring charges, to be incurred in the fourth quarter, are estimated to range between $5.3 million to $6.3 million and will include additional severance, as well as lease termination costs of approximately $2.0 million.

We estimate restructuring charges to total between $9.0 million to $10.0 million, as detailed below, and will be recorded entirely in corporate selling, general and administrative expenses. The majority of these costs will result in future cash expenditures, starting in the fourth quarter of 2014.



	Severance Costs					Lease Termination Costs					Total
	(In millions of dollars)
	Range					Range					Range
Americas	$	1.8	-	$	2.0	$	1.9	-	$	2.1	$	3.7	-	$	4.1
OCG	1.3		-	1.5		0.0		-	0.0		1.3		-	1.5
Headquarters	4.0		-	4.4		0.0		-	0.0		4.0		-	4.4

Total	$	7.1	-	$	7.9	$	1.9	-	$	2.1	$	9.0	-	$	10.0