Restructuring Costs

3 Months Ended

Mar. 31, 2022

Restructuring Charges [Abstract]

Restructuring Costs

Restructuring costs

Our accounting for employee separations is dependent upon how the particular program is designed. For voluntary programs, we recognize eligible separation costs at the time of employee acceptance unless the acceptance requires explicit approval by the company. For involuntary programs, we recognize eligible costs when management has approved the program, the affected employees have been properly notified and the costs are estimable.

Restructuring costs for the three months ended March 31, 2022 and 2021 were as follows:

(Millions of dollars)	Three Months Ended March 31
	2022		2021
Employee separations 1	$	5	$	45
Long-lived asset impairments 1	—		11
Other 2	8		8
Total restructuring costs	$	13	$	64
1 Recognized in Other operating (income) expenses.
2 Represents costs related to our restructuring programs, primarily for accelerated depreciation, project management, equipment relocation and inventory write-downs, all of which are primarily included in Cost of goods sold.

For both the three months ended March 31, 2022 and 2021, the restructuring costs were primarily related to actions across the company including strategic actions to address a small number of products.

In 2022 and 2021, all restructuring costs are excluded from segment profit.

The following table summarizes the 2022 and 2021 employee separation activity:

(Millions of dollars)	Three Months Ended March 31
	2022		2021
Liability balance, beginning of period	$	61	$	164
Increase in liability (separation charges)	5		45
Reduction in liability (payments)	(19)		(55)
Liability balance, end of period	$	47	$	154

Most of the liability balance at March 31, 2022 is expected to be paid in 2022.