4. Impairment and Restructuring Charges

For the three and six months ended June 30, 2017, the Company recorded $6 million and $16 million, respectively, of net restructuring charges. During the first quarter of 2017, the Company implemented an organizational restructuring effort in Argentina in order to achieve a more competitive cost position. We notified the local labor union of a planned reduction in workforce, which resulted in a strike by the labor union and an interruption of manufacturing activities during the second quarter of 2017. We finalized a new labor agreement with the labor union in the second quarter, ending the strike on June 1, 2017. For the three and six months ended June 30, 2017, the Company recorded total pre-tax restructuring-related charges in Argentina of $6 million and $17 million, respectively, for employee-related severance and other costs. The Company has nearly completed this important organizational restructuring of the Argentina business.

During the second quarter of 2017, the Company announced a Finance Transformation initiative in North America to strengthen organizational capabilities and drive efficiencies to support the growth strategy of the Company. The Company recorded $1 million of non-employee-related restructuring charges during the second quarter of 2017 related to this initiative. The Company expects to incur between $8 million and $10 million of employee-related severance and other costs in the second half of 2017 and between $1 million and $2 million in 2018 related to this initiative. Additionally, for the three and six months ended June 30, 2017, the Company recorded a reduction in employee severance costs of $1 million and $2 million, respectively, related to refinement of estimates for prior year restructuring activities.

During the second quarter of 2016, the Company recorded $13 million of restructuring charges consisting of $8 million of employee-related severance and other costs due to the execution of global IT outsourcing contracts, $3 million of employee-related severance costs associated with the Company’s optimization initiative in South America and $2 million of costs attributable to the 2015 Port Colborne plant sale.

A summary of the Company’s severance accrual as of June 30, 2017 is as follows (in millions):


Balance in severance accrual as of December 31, 2016	$	7
Restructuring charge for employee severance costs:
Argentina employee-related severance		15
Prior year restructuring activities		(2)
Payments made to terminated employees		(12)
Balance in severance accrual as of June 30, 2017	$	8

Of the $8 million severance accrual as of June 30, 2017, $6 million is expected to be paid in the next twelve months.