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French unions protest loosening of labor rules

Tuesday - 3/5/2013, 2:20pm  ET

French CGT and FO union members demonstrate to protest the Socialist government’s plans to loosen this country’s famously rigid labor rules, Paris, Tuesday, March 5, 2013. Multinationals are shutting factories around France amid Europe’s economic slowdown. France’s government is trying to stem job losses and turn the stagnant economy around with a new draft labor law being presented at a Cabinet meeting Wednesday. Writing on banner at top right reads, "Forbid layoffs". (AP Photo/Benjamin Girette)

SYLVIE CORBET
Associated Press

PARIS (AP) -- France's toughest unions are protesting a potentially landmark plan to loosen the country's famously rigid labor rules, calling it a betrayal by Socialist President Francois Hollande and a gift to capitalist bosses.

Multinationals are shutting factories around France amid Europe's economic slowdown, with many complaining about the high cost of employing French workers. The French government is trying to stem job losses and turn the stagnant economy around with a new draft labor law expected to be introduced at a Cabinet meeting Wednesday.

Three leading French unions and the leading employers' lobby signed on to the plan in January, but two leading hard-line unions oppose it -- and staged protests in cities around France on Tuesday along with small, scattered strikes.

The bill would make it easier for companies to cut salaries and working hours and negotiate with workers in times of financial difficulty. The government hopes this would encourage small businesses to hire, and encourage multinationals to keep production in France until the economy improves.

"This could really change the state of mind," Nicolas Grivel, a top aide to Labor Minister Michel Sapin, told The Associated Press. "There's a psychological aspect to all of this, in terms of the signal it could give, domestically and internationally. ... We are emerging from a schema of pure confrontation."

Opponents say the plan threatens France's hard-earned worker rights, which include powerful unions and complex benefits, and accuse Hollande of betraying his leftist ideals.

With red union flags waving above central Paris, protester Catherine Marchais said, "Some people are telling us that it is a way to preserve jobs. I think it is the contrary. That's why I think it is very dangerous."

Some marchers in Paris had their hands tied together to symbolize their argument that workers would be enslaved under the new plan.

The plan is full of "lies and disdain" for workers, far left politician Jean-Luc Melenchon said at the protest, adding, "We didn't elect him to do this."

Melenchon, whose Left Front party is increasingly critical of the more moderate Socialist Party, accused Hollande of following in the footsteps of his conservative predecessor Nicolas Sarkozy.

Sarkozy was widely accused of being too friendly to rich executives and threatened to shake up France's worker-friendly labor system. He largely failed, however, and the changes he did push through met mass protests.

Hollande won election pledging to defend the French economic model. His government argues that the labor overhaul is a compromise that will save jobs and offers new benefits to workers, too.

"You could say, for two years, we can adjust the working hours, adjust salaries, and in these conditions we can envisage getting out and surmounting the problem," Grivel said. "In exchange, the company says, I'll keep the jobs, and in parallel I won't distribute growing dividends to shareholders, I won't raise the salaries of executives, etc."

The plan, which will need parliamentary approval, includes incentives for companies to hire people on full-time contracts instead of temporary contracts, and would involve workers more in discussions about a company's economic health.

France has long struggled with high labor costs, which include high payroll taxes and social charges, but the global economic slowdown has exposed and exacerbated the problem, and French companies are less and less competitive internationally.

Hollande's popularity is sinking as unemployment is rising. A poll by Ifop released Tuesday showed just 37 percent of respondents support him, with approval eroding especially sharply among working class voters and young people.

___

AP writer Angela Charlton contributed to this story.


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