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Integration and Restructuring Costs
 12 Months Ended
Dec. 31, 2019
Restructuring and Related Activities [Abstract]  
Integration and Restructuring Costs Integration and Restructuring Costs
JLT Related Integration and Restructuring
The Company is currently integrating JLT, which will involve combining the business practices and co-locating colleagues in most geographies, rationalization of real estate leases around the world, realization of synergies and migration of legacy JLT systems onto the Company's information technology environment and security protocols, consulting fees related to integration management processes and legal fees related to the rationalization of legal entity structures that will reduce costs, mitigate risks and improve operational transparency.
Costs will be recognized based on applicable accounting guidance which includes accounting for disposal or exit activities, guidance related to impairment of long lived assets (for right of use assets related to real estate leases), as well as other costs resulting from accelerated depreciation or amortization of leasehold improvements and other property and equipment. Based on its current estimates, the Company expects to incur costs of approximately $700 million in connection with the integration and restructuring of the combined businesses, primarily related to severance, real estate rationalization, information technology rationalization, consulting fees related to the management of the integration processes and legal fees related to the rationalization of legal entity structures. The Company has incurred $335 million in 2019 and expects most of the remaining costs to be incurred in 2020, with a modest amount in 2021. These integration and restructuring plans are still being finalized, which may change our current cost and related savings estimates, as the Company continues to refine its detailed plans for each business and location.
In connection with the JLT integration and restructuring, for the twelve month period ended December 31, 2019, costs incurred were $229 million in RIS, $18 million in Consulting, and $88 million in Corporate. The severance and related costs were included in compensation and benefits and the other costs were included in other operating expenses in the consolidated statement of income.
Details of the JLT integration and restructuring activity from January 1, 2019 through December 31, 2019, are as follows:
(In millions)
Severance
 
Real Estate Related Costs (a)
 
Information Technology (a)
 
Consulting and Other Outside Services (b)
 
Total
Liability at 1/1/19
$
—

 
$
—

 
$
—

 
$
—

 
$
—

2019 Charges
154

 
38

 
45

 
98

 
335

Cash payments
(112
)
 
(14
)
 
(45
)
 
(94
)
 
(265
)
Non-cash charges
—

 
(19
)
 
—

 
(4
)
 
(23
)
Liability at 12/31/19
$
42

 
$
5

 
$
—

 
$
—

 
$
47

(a) Includes data center contract termination costs and temporary infrastructure leasing costs.
(b) Includes consulting fees related to the management of the integration processes and legal fees related to the rationalization of legal entity structures.
Other Restructuring
During 2018 and 2019, Marsh initiated programs to simplify its organization structure and realign and rebrand certain of its businesses. The Company incurred severance and consulting costs of $34 million for the twelve month period ended December 31, 2019, related to these initiatives.
During the fourth quarter of 2018, Mercer initiated a program to restructure its business to further optimize the way Mercer operates, setting up the Company for a more fluid and nimble structure and operating model for the future. The Company incurred restructuring severance and consulting costs of $56 million for the twelve month period ended December 31, 2019 related to this initiative.
In addition to the changes discussed above, the Company incurred at Corporate $22 million of restructuring costs primarily related to future rent under non-cancelable leases.
Details of the restructuring liability activity from January 1, 2018 through December 31, 2019, including actions taken prior to 2019, are as follows:
(In millions)
Balance at
1/1/18

 
Amounts
Accrued

 
Cash
Paid

 
Other

 
Liability at
12/31/18

 
Amounts
Accrued

 
Cash
Paid

 
Other

 
Balance at
12/31/19

Severance
$
15

 
$
137

 
$
(77
)
 
$
(2
)
 
$
73

 
$
73

 
$
(91
)
 
$
(4
)
 
$
51

Future rent under non-cancelable leases and other costs
50

 
24

 
(37
)
 
2

 
39

 
39

 
(21
)
 
(6
)
 
51

Total
$
65

 
$
161

 
$
(114
)
 
$
—

 
$
112

 
$
112

 
$
(112
)
 
$
(10
)
 
$
102


As of January 1, 2017, the liability balance related to restructuring activity was $93 million. In 2017, the Company accrued $40 million and had cash payments and other adjustments of $68 million related to restructuring activities that resulted in the liability balance at December 31, 2017 reported above.
The expenses associated with the above initiatives are included in compensation and benefits and other operating expenses in the consolidated statements of income. The liabilities associated with these initiatives are classified on the consolidated balance sheets as accounts payable and accrued liabilities, other liabilities or accrued compensation and employee benefits, depending on the nature of the items. These programs are substantially completed as of December 31, 2019.