The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office closures. Restructuring and related charges primarily include the following costs related to these programs:

•Employee - severance and relocation benefits

•Exit - contract termination penalties

The expenses related to these activities are included in the Condensed Consolidated Statements of Operations as restructuring and related charges and totaled $51 million and $4 million during the three months ended March 31, 2021 and 2020, respectively.

Restructuring expenses in 2021 are primarily due to Transformative Growth to optimize and simplify the Company’s operating model and cost structure and costs related to the future work environment.

In connection with Transformative Growth, the Company expects to incur restructuring and related charges totaling approximately $290 million, with $238 million recorded in 2020 and $17 million recorded in the first quarter of 2021.

In connection with the future work environment, the Company expects to incur restructuring and related charges, primarily for real estate exit costs totaling approximately $110 million with $33 million recognized in the first quarter of 2021.

These charges are primarily recorded in the Allstate Protection segment. The Company expects these actions will be completed in 2021.

Employee costs related to the Transformative Growth program include severance and employee benefits primarily impacting claims, sales, service and support functions. Exit costs reflect real estate costs primarily related to accelerated amortization of right of use assets and related leasehold improvements at facilities to be vacated.


Restructuring activity during the period
($ in millions)	Employee costs		Exit costs		Total liability
Restructuring liability as of December 31, 2020	$	72	$	—	$	72
Expense incurred	2		53		55
Adjustments to liability	(4)		—		(4)
Payments and non-cash charges	(29)		(53)		(82)
Restructuring liability as of March 31, 2021	$	41	$	—	$	41

As of March 31, 2021, the cumulative amount incurred to date for active programs related to employee severance, relocation benefits and exit expenses totaled $220 million for employee costs and $105 million for exit costs.