16.

Contingencies

From time to time, the Company is a defendant or plaintiff in various legal actions that arise in the ordinary business course. These matters

may

relate to professional liability, tax, compensation, contract, competitor disputes, and employee-related matters and include individual and class action lawsuits, as well as inquiries and investigations by governmental agencies regarding the Company's employment and compensation practices. Additionally, some of the Company's clients

may

also become subject to claims, governmental inquiries and investigations, and legal actions relating to the Company's professional services. Depending upon the particular facts and circumstances, the Company

may

also be subject to indemnification obligations under its contracts with such clients relating to these matters.

As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries. The Company

may

not

be covered by insurance as it pertains to some or all of these matters. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. The Company records a liability when management believes an adverse outcome from a loss contingency is both probable and the amount, or a range, can be reasonably estimated. Significant judgment is required to determine both probability of loss and the estimated amount. The Company reviews its loss contingencies at least quarterly and adjusts its accruals and/or disclosures to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, or other new information, as deemed necessary. Once established, a provision

may

change in the future due to new developments or changes in circumstances and could increase or decrease the Company's earnings in the period that the changes are made.

The Company is exposed to various asserted claims as of

April 3, 2021,

where the Company believes it has a probability of loss. As of

April 3, 2021,

the Company has accrued

$1.8

million for asserted claims of

$2.0

million. Additionally, the Company is exposed to other asserted claims whereby an amount of loss has

not

been declared, and the Company can't determine the potential loss. Any of these various claims could result in an unfavorable outcome or settlement that exceeds the accrued amounts. However, the Company believes that such matters will

not,

either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. Included in the

April 3. 2021

accrual of

$1.8

million, the Company has reserved

$1.7

million for the settlement of a class-action suit in California that alleges the Company did

not

properly pay its travel nurses overtime wages. While the Company believes it did

not

violate any overtime wage laws, it nevertheless decided to settle this class action lawsuit in

December 2020.

The Company expects to pay the

$1.7

million settlement sometime during the

third

quarter of fiscal

2021.