v3.25.2
EMPLOYEE RETENTION TAX CREDITS
6 Months Ended
Jun. 29, 2025
Postemployment Benefits [Abstract]  
EMPLOYEE RETENTION TAX CREDITS EMPLOYEE RETENTION TAX CREDITS
In 2020, the World Health Organization publicly characterized COVID-19 as a pandemic. The Company recognized a substantial amount of incremental costs during the pandemic, including costs to compensate employees who were not able to work due to facility closures, reduced work schedules or health related reasons.
The Coronavirus Aid, Relief, and Economic Security Act was signed into law in March 2020, which provided, among other things, an employee retention credit to eligible employers who paid qualified wages to employees during the pandemic. The employee retention credit represents a government grant. Our policy is to recognize government grants when they are reasonably assured of receipt. We recognized employee retention tax credits totaling $10 million and $87 million in the second quarters of 2025 and 2024, respectively, after concluding the recognition threshold had been met. All credits were classified in cost of sales in the condensed consolidated statements of income with the exception of $1 million in the second quarter of 2024, which was classified in SG&A.