NOTE 11: RESTRUCTURING CHARGES

During the first three and six months of fiscal year 2018, Adtalem recorded restructuring charges primarily related to reductions in force (“RIF”) and real estate consolidations at Carrington and Adtalem’s home office. Termination benefit charges, as a result of reducing Adtalem’s workforce by 98 positions in the first six months of fiscal year 2018, represented severance pay and benefits for these employees. We also recorded a reduction to restructuring charges in the first six months of fiscal year 2018 for an adjustment to previously accrued estimates for real estate consolidations at Adtalem’s home office. During the first three and six months of fiscal year 2017, Adtalem recorded restructuring charges primarily related to real estate consolidations at Carrington and Adtalem’s home office. Adtalem’s home office is classified as “Home Office and Other” in “Note 15: Segment Information” to the Consolidated Financial Statements. Pre-tax restructuring charges by segment were as follows (in thousands):

	Three Months Ended December 31, 2017						Six Months Ended December 31, 2017
	Real Estate		Termination Benefits		Total		Real Estate		Termination Benefits		Total
Medical and Healthcare	$	-	$	-	$	-	$	26	$	86	$	112
U.S. Traditional Postsecondary		830		298		1,128		1,722		656		2,378
Home Office and Other		160		1,266		1,426		(465)		2,916		2,451
Total	$	990	$	1,564	$	2,554	$	1,283	$	3,658	$	4,941

	Three Months Ended December 31, 2016						Six Months Ended December 31, 2016
	Real Estate		Termination Benefits		Total		Real Estate		Termination Benefits		Total
U.S. Traditional Postsecondary	$	2,335	$	-	$	2,335	$	3,703	$	-	$	3,703
Home Office and Other		266		362		628		1,929		681		2,610
Total	$	2,601	$	362	$	2,963	$	5,632	$	681	$	6,313

The following table summarizes the separation and restructuring plan activity for the fiscal years 2018 and 2017, for which cash payments are required (in thousands):

Liability balance at June 30, 2016	$	48,223
Increase in liability (separation and other charges)		27,620
Reduction in liability (payments and adjustments)		(29,728)
Liability balance at June 30, 2017		46,115
Increase in liability (separation and other charges)		11,954
Reduction in liability (payments and adjustments)		(16,304)
Liability balance at December 31, 2017	$	41,765

Of this liability balance, $16.4 million is recorded as Accrued Liabilities and $25.4 million is recorded as Deferred Rent and Other Liabilities on the Consolidated Balance Sheet at December 31, 2017. These liability balances primarily represent rent accruals and costs for employees that have either not yet separated from Adtalem or their full severance has not yet been paid. All of these remaining costs are expected to be paid over the next 12 months except for rent charges which may be paid out for periods of up to 8 years.