16.	CONTINGENCIES

From time to time, the Company is a defendant or plaintiff in various legal actions that arise in the ordinary business course. These matters

may

relate to professional liability, tax, compensation, contract, competitor disputes, and employee-related matters and include individual and class action lawsuits, as well as inquiries and investigations by governmental agencies regarding the Company's employment and compensation practices. Additionally, some of the Company's clients

may

also become subject to claims, governmental inquiries and investigations, and legal actions relating to the Company's professional services. Depending upon the particular facts and circumstances, the Company

may

also be subject to indemnification obligations under its contracts with such clients relating to these matters.

As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries. The Company

may

not

be covered by insurance as it pertains to some or all of these matters. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. The Company records a liability when management believes an adverse outcome from a loss contingency is both probable and the amount, or a range, can be reasonably estimated. Significant judgment is required to determine both probability of loss and the estimated amount. The Company reviews its loss contingencies at least quarterly and adjusts its accruals and/or disclosures to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, or other new information, as deemed necessary. Once established, a provision

may

change in the future due to new developments or changes in circumstances and could increase or decrease the Company's earnings in the period that the changes are made.

The Company has reserved

$1.7

million for the settlement of a class action suit in California that alleges the Company did

not

properly pay its travel nurses overtime wages. While the Company believes it did

not

violate any overtime wage laws, it nevertheless decided to settle this class action lawsuit in

December 2020.

The Company expects to pay the

$1.7

million settlement sometime during its

third

quarter of fiscal

2021.

The Company is exposed to other asserted claims as of

January 2, 2021,

but the Company does

not

believe any of these other claims have a probability of loss. As of

January 2, 2021,

the Company did

not

have an accrual for any such other claims. Furthermore, even if any of these other claims do result in an unfavorable outcome or settlement, the Company believes that such matters will

not,

either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows.

The Company had a dispute with a customer that is a major utility in the United States. Both parties agreed in fiscal

2017

to resolve this dispute through binding arbitration. Arbitration hearings with this customer started in fiscal

2018.

Essentially, the customer did

not

pay the balance of accounts receivable the Company believes were owed for certain disputed projects. As of

December 28, 2019,

the total amount of recorded receivables from this customer on these disputed projects was

$14.1

million. Additionally, as part of the arbitration process, the customer asserted counter-claims of

$10.3

million. The arbitrator rendered a decision in this dispute in

April 2020,

awarding the Company

$7.4

million, and the arbitration award was paid during the

fifty-three

week period ended

January 2, 2021.

The counter-claims asserted against the Company of

$10.3

million were denied in their entirety. For the

fifty-three

week period ended

January 2, 2021,

the Company recorded a charge of

$8.4

million, including

$6.7

million constituting the portion of the accounts receivable relating to the disputed projects that was

not

awarded by the arbitrator,

$0.7

million from other projects with this customer that were

not

part of the arbitration,

$0.8

million in professional fees related to the dispute and arbitration, and

$0.2

million of transit accounts receivable associated with disputed projects that were part of the arbitration. The Company decided to write off the

$0.7

million of accounts receivable from other projects

not

part of the arbitration for business reasons.