Note 12. Restructuring and Related Charges

The Company has initiated restructuring events primarily intended to reduce its costs, consolidate its operations, integrate various acquisitions, streamline product manufacturing and align its business to address market conditions. The Company’s restructuring charges primarily include severance and benefit costs to eliminate a specific number of positions, facilities and equipment costs to vacate facilities and consolidate operations, and lease termination costs. The timing of associated cash payments is dependent upon the type of restructuring charge and can extend over multiple periods.

As of March 30, 2019 and June 30, 2018, the Company’s total restructuring accrual was $11.4 million and $7.5 million, respectively. During the three and nine months ended March 30, 2019, the Company recorded restructuring and related charges of $0.9 million and $16.0 million, respectively. During the three and nine months ended March 31, 2018, the Company recorded restructuring and related charges of $0.3 million and $4.3 million, respectively.

Summary of Restructuring Plans

The following table presents the adjustments to the accrued restructuring expenses related to all of the Company’s restructuring plans described below for the three and nine months ended March 30, 2019 (in millions):



	Balance June 30, 2018		Nine Months Ended March 30, 2019 Charges (Benefits)			Cash Settlements			Non-cash Settlements and Other Adjustments			Balance March 30, 2019		Three Months Ended March 30, 2019 Charges (Benefits)
Fiscal 2019 Plan
NSE, including AW Restructuring Plan ⁽¹⁾	$	—	$	16.7		$	(5.3	)	$	(0.3	)	$	11.1	$	1.6
Fiscal 2018 Plan
Trilithic Restructuring Plan ^{(1) (2)}	2.9		—			(2.9		)	—			—		—
Fiscal 2017 Plan
Focused NSE Restructuring Plan ^{(1) (2)}	1.9		0.1			(2.1		)	0.1			—		—
Plans Prior to Fiscal 2017
NE Lease Restructuring Plan ⁽²⁾	1.2		(0.5		)	(0.7		)	—			—		(0.5		)
Other Plans ^{(1) (2)}	1.5		(0.3		)	(0.9		)	—			0.3		(0.2		)
Total	$	7.5	$	16.0		$	(11.9	)	$	(0.2	)	$	11.4	$	0.9


⁽¹⁾	Plan type includes workforce reduction cost.


⁽²⁾	Plan type includes lease exit cost.

The long-term portion of our total restructuring liability for the March 30, 2019 and June 30, 2018 periods is $0.7 million and $0.1 million, respectively. The remaining portion has been included as a component of Other current liabilities on the Consolidated Balance Sheets.

Fiscal 2019 Plans

NSE, including AW Restructuring Plan

During the first quarter of fiscal 2019, Management approved restructuring and workforce reduction plans within its Network Service and Enablement (“NSE”) business, including actions related to the recently acquired AW business. These actions further drive the Company’s strategy for organizational alignment and consolidation as part of its continued commitment to a more cost effective and agile organization and to improve overall profitability in the Company’s NSE business. Included in these restructuring plans are specific actions to consolidate and integrate the newly acquired AW business within the NSE business segment. During the third quarter of fiscal 2019, the Company has updated the plan to include additional headcount primarily to transfer a portion of the manufacturing operations related to the recently acquired AW business to a contract manufacturer. As a result, a total restructuring charge of $16.7 million was recorded in the nine months ended March 30, 2019 for severance and employee benefits for approximately 253 employees primarily in manufacturing, R&D and SG&A functions located in North America, Latin America, Europe and Asia. Payments related to the severance and benefits accrual are expected to be paid by the end of the fourth quarter of fiscal 2020.

Fiscal 2018 Plans

Trilithic Restructuring Plan

During the second quarter of fiscal 2018, Management approved a plan within the NE business segment to consolidate and integrate the Trilithic acquisition. As a result, approximately 40 employees primarily in manufacturing, and SG&A functions located in the United States were impacted. Payments related to the severance and benefits accrual were paid by the end of the first quarter of fiscal 2019.

Plans Prior to Fiscal 2018 Plans

Focused NSE Restructuring Plan

During fiscal 2017, Management approved a plan within the NE and SE business segments as part of VIAVI’s continued strategy to improve profitability in the Company’s NSE business by narrowing the scope of the Service Enablement business and reducing costs by streamlining NSE operations. In total, approximately 360 employees in manufacturing, R&D and SG&A functions located in North America, Latin America, Europe and Asia were impacted. Payments related to the severance and benefits accrual were paid by the end of the first quarter of fiscal 2019. In the first quarter of fiscal 2019, the Company exited the workspace in Vancouver, Canada under the plan. Payments related to the Vancouver lease costs were paid by the end of the second quarter of fiscal 2019.

NE Lease Restructuring Plan

During the second quarter of fiscal 2014, Management approved a NE plan to exit the remaining space in Germantown, Maryland. As of June 28, 2014, the Company exited the space in Germantown under the plan. Payments related to the Germantown lease costs were paid by the end of the third quarter of fiscal 2019.

As of March 30, 2019, the restructuring accrual for other plans that commenced prior to fiscal year 2017 was $0.3 million, which consists of immaterial accruals from various restructuring plans.