Restructurings

9 Months Ended

Jul. 03, 2020

Restructuring and Related Activities [Abstract]

RESTRUCTURINGS

We have periodically implemented restructuring actions in connection with broader plans to reduce staffing, reduce our internal manufacturing footprint and generally reduce operating costs. The restructuring expenses are primarily comprised of direct and incremental costs related to headcount reductions including severance and outplacement fees for the terminated employees, as well as facility closure costs.

The following is a summary of the restructuring charges incurred under the plans noted below (in thousands):


	Three Months Ended						Nine Months Ended
	July 3, 2020		June 28, 2019		July 3, 2020		June 28, 2019
Employee related expenses and adjustments	$	(761)	$	5,135	$	787	$	6,742
Facility related expenses	207		3,752		707		10,305
Total restructuring (benefit) charges	$	(554)	$	8,887	$	1,494	$	17,047

The following is a rollforward of the accrued restructuring liabilities for the nine months ended July 3, 2020 (in thousands):


	Employee-Related Expense ⁽¹⁾		Facility-Related Expense ⁽²⁾		Total
Balance at September 27, 2019	$	1,549	$	978	$	2,527
Charges and adjustments	787		707		1,494
Charges paid/settled/other	(1,460)		(1,492)		(2,952)
Balance at July 3, 2020	$	876	$	193	$	1,069

(1) Primarily includes severance charges associated with the reduction of our workforce in certain facilities.

(2) Primarily includes activities associated with the closure of certain facilities, including any associated asset impairments and contract termination costs.

Ithaca Plan

During the fiscal quarter ended December 28, 2018, we commenced a plan to exit certain production and product lines, primarily related to certain production facilities located in Ithaca, New York (the “Ithaca Plan”). We incurred restructuring charges for the Ithaca Plan of $0.2 million in the three months ended June 28, 2019, including $0.1 million of employee-related costs, and $5.5 million in the nine months ended June 28, 2019, including $1.5 million of employee-related costs and $4.0 million of facility-related costs. This action was completed in fiscal year 2019 and no further costs will be incurred. The remaining charges were paid during the three months ended January 3, 2020.

Details of the Ithaca Plan activities during the nine months ended July 3, 2020 are as follows (in thousands):


	Employee-Related Expense		Facility-Related Expense		Total
Balance at September 27, 2019	$	13	$	70	$	83
Charges and adjustments	—		(40)		(40)
Charges paid/settled	(13)		(30)		(43)
Balance at July 3, 2020	$	—	$	—	$	—

Design Facilities Plan

During the fiscal quarter ended March 29, 2019, we committed to a plan to exit certain design facilities and activities (the “Design Facilities Plan”). We recorded a net benefit of $0.3 million in the three months ended June 28, 2019, including $0.1 million of employee-related costs and $0.4 million of facility-related reimbursements. We incurred restructuring charges of $2.5 million for the nine months ended June 28, 2019, including $0.3 million of employee-related costs and $2.2 million primarily related to impairment of equipment. This action was completed in fiscal year 2019 and no further costs will be incurred. The remaining charges were paid during the three months ended July 3, 2020.

Details of the Design Facilities Plan activities during the nine months ended July 3, 2020 are as follows (in thousands):


	Facility-Related Expense
Balance at September 27, 2019	$	451
Charges and adjustments	(18)
Charges paid/settled	(433)
Balance at July 3, 2020	$	—

2019 Plan

During the fiscal quarter ended June 28, 2019, we committed to a plan designed to strategically realign, streamline and improve certain of our business and operations, including reducing our workforce by approximately 250 employees, exiting six development facilities in France, Japan, the Netherlands, Florida, Massachusetts and Rhode Island, reducing certain development activities for one of our product lines and no longer investing in the design and development of optical modules and subsystems for Data Center applications (the “2019 Plan”). We incurred a restructuring benefit of $0.6 million in the three months ended July 3, 2020 under the 2019 Plan, including a benefit of $0.8 million for employee-related costs and $0.2 million of other costs, and charges of $1.6 million in the nine months ended July 3, 2020, including $0.8 million of employee-related costs and $0.8 million of other costs. The restructuring net benefit for the three months ended July 3, 2020 includes an adjustment to accrued employee-related costs resulting from a decision during the fiscal third quarter to retain certain employees. We incurred restructuring charges of $9.0 million in the three months ended June 28, 2019 under the 2019 Plan, including $4.9 million of employee-related costs, $4.0 million of impairment expense for fixed assets that will be disposed of and $0.1 million of other costs. We expect to incur additional restructuring costs up to $0.2 million through fiscal year 2020 as we complete this restructuring action.

Details of the 2019 Plan activities during the nine months ended July 3, 2020 are as follows (in thousands):


	Employee-Related Expense		Facility-Related Expense		Total
Balance at September 27, 2019	$	1,536	$	457	$	1,993
Charges and adjustments	787		765		1,552
Charges paid/settled/other	(1,447)		(1,029)		(2,476)
Balance at July 3, 2020	$	876	$	193	$	1,069