Restructuring and Transformation Activities

6 Months Ended

Jun. 30, 2024

Restructuring and Related Activities [Abstract]

Restructuring and Transformation Activities

2024 Actions

The Company incurred restructuring charges and transformation fees of $4.3 million in the second quarter of 2024 and $6.6 million in June year-to-date 2024 as a continuation of the actions that were announced in the second quarter of 2023 as part of the comprehensive transformation initiative. The transformation activities include severance charges of $2.4 million and $3.5 million for the second quarter and June year-to-date 2024, respectively, and costs to execute the transformation including the use of an external consultant of $1.9 million and $3.1 million for the second quarter and June year-to-date 2024, respectively. The severance and transformation costs are recorded in selling, general and administrative ("SG&A") expenses in the consolidated statements of earnings. Additionally, in the second quarter of 2024, the Company recognized an impairment charge of $5.5 million for certain right-of-use assets related to our leased headquarters facility reflecting adjustments as to how we are utilizing the building as a part of our ongoing transformation efforts. The impairment charge related to the right-of-use assets is recorded in the asset impairment charge in the consolidated statements of earnings.

The restructuring and transformation costs included in SG&A are detailed below for the second quarter and June year-to-date 2024 (in millions of dollars):


	Second Quarter 2024						June Year to Date 2024
	Severance Costs		Transformation Costs		Total		Severance Costs		Transformation Costs		Total

Professional & Industrial	$	0.3	$	—	$	0.3	$	0.4	$	—	$	0.4
Science, Engineering & Technology	0.3		—		0.3		0.3		—		0.3

Outsourcing & Consulting	—		—		—		0.6		—		0.6
Corporate	1.8		1.9		3.7		2.2		3.1		5.3
Total	$	2.4	$	1.9	$	4.3	$	3.5	$	3.1	$	6.6

2023 Actions

In the second quarter of 2023, the Company announced a comprehensive transformation initiative that includes actions that will further streamline the Company's operating model to enhance organizational efficiency and effectiveness. The total costs incurred related to these transformation activities in the second quarter of 2023 totaled $8.0 million. The transformation activities included $4.5 million of costs to execute the transformation initiatives through the use of an external consultant, a $2.4 million impairment charge for right-of-use assets related to an unoccupied office space lease and additional severance of $1.1 million, net of adjustments. The impairment charge related to the right-of-use assets is recorded in the asset impairment charge in the consolidated statements of earnings. The costs to execute and severance are included in the $5.6 million of restructuring costs incurred in the second quarter of 2023, net of prior period adjustments, and are recorded in SG&A expenses in the consolidated statements of earnings, as detailed further below.

In the first quarter of 2023, the Company undertook restructuring actions to further our cost management efforts in response to the current demand levels and reflect a repositioning of our P&I staffing business to better capitalize on opportunities in local markets. Restructuring costs incurred in the first quarter of 2023 totaled $6.6 million and were recorded entirely in SG&A expenses in the consolidated statements of earnings.

The restructuring and transformation costs included in SG&A are detailed below for the second quarter and June year-to-date 2023 (in millions of dollars):



	Second Quarter 2023						June Year to Date 2023
	Severance Costs		Lease Termination Costs, Transformation and Other		Total		Severance Costs		Lease Termination Costs, Transformation and Other		Total

Professional & Industrial	$	0.3	$	—	$	0.3	$	3.0	$	0.3	$	3.3
Science, Engineering & Technology	—		—		—		0.4		0.1		0.5
Education	0.3		—		0.3		0.4		—		0.4
Outsourcing & Consulting	(0.1)		—		(0.1)		0.5		—		0.5
International	—		—		—		0.6		—		0.6
Corporate	0.6		4.5		5.1		0.8		6.1		6.9
Total	$	1.1	$	4.5	$	5.6	$	5.7	$	6.5	$	12.2

Accrual Summary

A summary of the global restructuring balance sheet accrual, included in accrued payroll and related taxes and accounts payable and accrued liabilities in the consolidated balance sheet, is detailed below (in millions of dollars):


Balance as of year-end 2023	$	15.1
Accruals	2.3






Reductions for cash payments	(11.0)
Disposition of EMEA staffing operations	(1.5)
Accrual adjustments	(0.2)
Balance as of first quarter-end 2024	4.7
Accruals	4.3
Reductions for cash payments	(4.4)

Balance as of second quarter-end 2024	$	4.6

The remaining balance of $4.6 million as of second quarter-end 2024 primarily represents the costs to execute the transformation initiatives and severance costs, and the majority is expected to be paid by the end of 2024. No material adjustments are expected to be recorded.