France's Hollande holds ground on contested labour reform bill

[PARIS] French President Francois Hollande said there was no turning back on a bill to loosen France's rigid labour regulations and that the principles behind the most contentious proposal handing firms more scope to negotiate working conditions must remain in place.

France, the euro zone's second biggest economy, has been rocked by violent street protests and walkouts in the transport and energy industries over the labour bill that proposes making it easier for firms to hire and fire.

With just 10 days to go until France hosts the Euro 2016 soccer tournament, the government is under intense pressure to find a way out of its standoff with the CGT union, which is spearheading demands the labour bill be scrapped.

A key sticking point is Article 2 of the bill which hands companies more power to negotiate pay and working conditions and could weaken the influence of trade unions in the work place. "The bill will not be withdrawn," Mr Hollande was quoted as saying in an interview published in the Sud Ouest newspaper late on Monday. "The principles of Article 2 will be kept."

The bill awaits debate in the Senate after the government forced it through the lower chamber without vote, faced with a rebellion by its own lawmakers. It will then return to the National Assembly lower house for a final vote.

Asked if he would pass the bill into law by decree, Mr Hollande said in further comments: "I would prefer that the text be adopted without having to do so. But not at the price of abandoning it."

The reforms have driven a wedge into the ruling party, pitting Mr Hollande and his more reformist ministers against its hardline socialists less than a year before presidential elections.

Mr Hollande says he will only run for a second term if he brings down unemployment, stuck at about 10 per cent. "The French will be able to judge for themselves," Mr Hollande was quoted as saying.

His comments came as some CGT unionised rail workers began another nationwide strike and Paris metro employees staged a walkout. Six of France's eight refineries remain shut down due to oil worker strikes.

Mr Hollande recognised the right to strike but said protest movements should not bring the country grinding to a halt. He sought to play down the risk of social unrest derailing the Euro tournament.

The month-long tournament opens across France with a state of emergency still in force after Islamist attacks last November that killed 130 people in Paris at several sites across the capital. "The real threat comes from terrorism," Mr Hollande said.

About 90,000 police, soldiers and private security agents will be deployed across the country, with the government citing potential "terrorist" attacks and acts of hooliganism as the main threats.

REUTERS