USG People gets adverse ruling in French appeal case
After receiving an adverse ruling in a French appeal case, USG People have said they will look into other legal possibilities, such as lodging an appeal with a higher court.
In 2011, USG People received an assessment relating to Start People, from the French social security authority URSSAF, following a social security investigation. The assessment concerns the assumption by URSSAF that taxes and social security contributions owed on the salaries of temporary employees were calculated incorrectly. The assessment concerns the years 2009 and 2010 and amounts to € 16.9m.
USG People lodged an appeal against the URSSAF assessment with the Arbitration Committee (Commission de Recours Amiable) at the end of February 2012. This appeal was dismissed on 21st June 2012. USG People subsequently lodged an appeal with the Tribunal des affaires de sécurité sociale at the end of July 2012 and the court ruled in USG People’s favour on 3rd September 2014. URSSAF then appealed against this decision. Given this ruling by the Tribunal des affaires de sécurité sociale, and based on USG People’s position that the payments, as made, were in accordance with the law, the assessment amount was recognised as a contingent liability in the 2014 financial statements.
Now that the French appeal court has ruled in favour of URSSAF, USG People has decided to charge the total costs relating to the assessment, including the interest on tax due (estimated at € 3.4m), to income as non-recurring costs in the fourth quarter of 2015. USG People will study the ruling and look into the legal possibilities of lodging an appeal with a higher court. Should USG People lodge an appeal and go on to win the procedure, the amounts refunded will be recognised as non-recurring income.