Subsequent Event

6 Months Ended

Jul. 03, 2016

Subsequent Events [Abstract]

Subsequent Events

Subsequent Event

On July 4, 2016, the Company and Temp Holdings completed a transaction to expand their existing North Asia joint venture, TS Kelly Workforce Solutions (formed in 2012). A new joint venture, TS Kelly Asia Pacific, was formed by the transfer of the Company’s Asia Pacific staffing operations, which will be subsequently deconsolidated, and Temp Holdings’ businesses, including Capita, with offices in Singapore and Malaysia; First Alliances, with offices in Vietnam; and Intelligence, with a presence in Indonesia, Vietnam, Singapore and Malaysia.

Upon closing, the Company received a cash payment of $36.5 million and a 49% equity interest in TS Kelly Asia Pacific. Temp Holdings owns the remaining 51% of the joint venture. In accordance with the terms of the transaction, a post-closing cash true-up adjustment may be required. The Company will record its interest in the joint venture as an equity method investment on the consolidated balance sheet during the third quarter of 2016 and will include its share of earnings prospectively in the consolidated statement of earnings. In connection with the transaction, the Company expects to record a gain on the deconsolidated assets of its Asia Pacific staffing operations during the third quarter of 2016, which is expected to be material. The Company is currently in the process of determining the fair value of its investment in TS Kelly Asia Pacific as of the closing date.

During the second quarter of 2016, the transaction met the criteria to be classified as held for sale. Accordingly, the Company has presented the assets and liabilities of its Asia Pacific staffing operations as held for sale on the consolidated balance sheet as of July 3, 2016 (see Assets and Liabilities Held for Sale footnote).