French unions urge Macron not to rush through labor reform

Easing of labour market regulations a priority for new French president in optimistic business climate

PARIS (Reuters) -- French unions urged President Emmanuel Macron on Tuesday not to try to hustle through his labour reform plans this summer, in contrast with calls from the main employers' group for swift measures to reinforce rising business optimism.

Macron's meetings with unions and employers were a first crucial test of his commitment to carry out labour reforms which he sees as vital to reviving an economy bedeviled by high unemployment, but which are opposed on the Left.

The head of France's biggest moderate trade union said he had urged the newly-elected Macron to leave more time for discussion and not to try to rush his reforms through by executive decree this summer - a strategy which Macron has suggested he might follow.

"I asked him not to do it hurriedly, to do it without rushing, that the idea should not be to wrap everything up by the end of summer, end of August," CFDT leader Laurent Berger told reporters.

The centrist leader wants to make hiring and firing easier by giving more powers to companies to reach in-house deals on working time, for instance, and capping severance packages awarded by industrial tribunals.

Against a background of 9.6 percent unemployment, the pro-business, Europe-minded Macron has made a loosening of labour market regulations his biggest economic priority for his first year in office.

During the roller-coaster campaign, Macron said he would seek parliament's approval over the summer for powers to push through legislation by means of executive decree.

But speaking after his own meeting with Macron later on, the head of the more militant CGT union said the president seemed willing to take more time than initially planned.

"The timetable seems to have changed," Philippe Martinez told reporters.

"It seems to me that the short time frame that was planned is not as short as I had understood," the leader of the CGT, which led weeks of sometimes violent protests last year against reforms by former Socialist President Francois Hollande, added.

A source close to Macron told Reuters it would be up to Prime Minister Edouard Philippe, a former right-wing mayor, and Labour Minister Muriel Penicaud to decide on the timetable.

"The president is very keen to respect the allocation of tasks between a president who sets the course while the prime minister and the labour minister establish a working timetable and discuss measures in detail," the source said.

But Macron was also reminded of French businesses' pressing demands for a more flexible labour market.

"The labour market reform must be tackled quickly. It's essential to be quick on this major French problem," Pierre Gattaz, the head of the Medef group of employers, said, adding that speed was essential to give confidence to investors.

The head of the smaller CPME group of employers said Macron was aiming to hold talks with unions until about mid-June, with a parliament vote to give him powers to legislate via decrees over the summer and a final parliament vote in September.

French companies have shown signs of growing optimism since Macron's election on May 7.

In a widely watched survey published on Tuesday, the French private sector was shown to have grown at the fastest pace in six years in May, with companies mentioning Macron's election as a reason for optimism.

That chimed with a separate survey from the official Insee statistics office which showed morale in the industrial sector at its highest level since June 2011

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