Sarkozy makes push on labour reform

Paris - French President Nicolas Sarkozy will push union leaders on Wednesday to accept an overhaul of labour rules, promising quick fixes for unemployment as he faces re-election, but one union official ruled out any “impulsive measures” before the vote.

As the euro debt crisis strips France of its prized AAA credit rating and pushes the economy to the brink of recession, Sarkozy is presenting his “crisis social summit” with business and union leaders as a chance to tackle high unemployment.

Unions, however, are refusing to be rushed into reforms to help his chances in the presidential elections to be held in April and May. This has weakened the prospects of a frank discussion on areas economists see as ripe for reform, ranging from restrictive labour laws to the 35-hour work week and the role unions play in pay negotiations.

“We are not going to this summit to negotiate structural reforms,” Laurent Berger, national secretary for employment at the powerful CFDT union, told Le Figaro newspaper on Tuesday. “Three months before a presidential election is not the time to take impulsive measures.

Pressure on Sarkozy intensified last week when ratings agency Standard & Poor's singled out “labour market rigidities” when explaining its downgrade of France by one notch to AA+.

Opinion polls show Sarkozy - who has yet to announce his candidacy officially - in danger of losing the presidential election. But he is racing for two deals he can announce by the end of January: making it easier for companies to cut working hours in a downturn; and shifting a portion of social fees from salaries to a consumption tax.

Sarkozy is due to present a summary of his meeting with unions and employers at midday, but will wait until the end of January to unveil the details of his reform proposals.

Critics say Sarkozy has a habit of hurrying into reforms and then watering them down to avoid conflict with unions.

“This is the classic scenario where he rushes into a deal at the last minute without taking enough time for consultation or following through,” said economy professor Pierre Cahuc at France's elite Polytechnique school.

“I'm extremely pessimistic about the chances of either the unions or the government pushing the job market in the direction of a real reform,” he added. - Reuters