Restructuring and Employee Severance

3 Months Ended

Sep. 30, 2018

Restructuring Charges [Abstract]

Restructuring and Employee Severance

3. Restructuring and Employee Severance

The following table summarizes restructuring and employee severance costs:

	Three months ended September 30,
(in millions)	2018		2017
Employee-related costs (1)	$	29	$	4
Facility exit and other costs (2)	3		128
Total restructuring and employee severance	$	32	$	132

(1) Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated.

(2) Facility exit and other costs primarily consist of product distribution and lease contract termination costs, accelerated depreciation, equipment relocation costs, project consulting fees and costs associated with restructuring our delivery of information technology infrastructure services.

In early fiscal 2019, we implemented certain enterprise-wide cost-saving measures, which we expect to reduce our future operating expenses. As a result, we incurred employee-related severance costs of $26 million, on a pre-tax basis, which are reflected in restructuring and employee severance in the condensed consolidated statements of earnings for the three months ended September 30, 2018.

In fiscal 2018, we entered into an agreement to transition the distribution of our Medical segment's surgeon gloves in certain international markets from a third-party distribution arrangement to a direct distribution model. The costs associated with this restructuring included $125 million, on a pre-tax basis, in contract termination costs that were paid during fiscal 2018. These costs are reflected in restructuring and employee severance in the condensed consolidated statements of earnings during the three months ended September 30, 2017.

The following table summarizes activity related to liabilities associated with restructuring and employee severance:

(in millions)	Employee- Related Costs			Facility Exit and Other Costs			Total
Balance at June 30, 2018	$	24		$	4		$	28
Additions	26			2			28
Payments and other adjustments	(5		)	(1		)	(6		)
Balance at September 30, 2018	$	45		$	5		$	50