Restructuring Costs

9 Months Ended

Sep. 30, 2023

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 and nine months ended September 30, 2023 and 2022 were as follows:



(Millions of dollars)	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Employee separations 1	$	10	$	39	$	32	$	62
Longwall divestiture 1	—		—		586		—
Contract terminations 1	—		1		—		1
Long-lived asset impairments 1	2		(4)		4		1

Other 2	34		13		66		26
Total restructuring costs	$	46	$	49	$	688	$	90


1 Recognized in Other operating (income) expenses.
2 Represents costs related to our restructuring programs, primarily for inventory write-downs, accelerated depreciation, project management and equipment relocation, all of which are primarily included in Cost of goods sold.

The restructuring costs for the nine months ended September 30, 2023 were primarily related to the divestiture of the company's Longwall business within Resource Industries. The divestiture closed on February 1, 2023 and resulted in a pre-tax loss of approximately $586 million, primarily a non-cash item driven by the release of $494 million of accumulated foreign currency translation. The transaction is subject to certain post-closing adjustments. For the nine months ended September 30, 2022, the restructuring costs were primarily related to actions across the company including strategic actions to address a small number of products.

In 2023 and 2022, all restructuring costs are excluded from segment profit.

The following table summarizes the 2023 and 2022 employee separation activity:



(Millions of dollars)	Nine Months Ended September 30,
	2023		2022
Liability balance, beginning of period	$	39	$	61
Increase in liability (separation charges)	32		62
Reduction in liability (payments)	(55)		(63)
Liability balance, end of period	$	16	$	60

Most of the liability balance at September 30, 2023 is expected to be paid in 2023 and 2024.