Paris - The French government warned telecoms equipment maker Alcatel-Lucent on Wednesday it could block any restructuring plans for France unless it negotiates with unions to save as many local jobs as possible.
The group unveiled plans on Tuesday to cut a total 10,000 jobs worldwide, including 900 in France, warning the cuts were the last chance to stem years of losses and turn the company around.
President Francois Hollande's government, facing rising unpopularity over high unemployment, criticised the plans and Prime Minister Jean-Marc Ayrault on Wednesday suggested it could use recent labour code changes to block any moves in France.
“If there is no majority agreement (with unions) the restructuring plan won't be accepted, because the law now gives the state the responsibility to act,” Ayrault told Europe 1 radio.
“We want a negotiation that saves as many jobs as possible, as many sites as possible,” he said, calling on Alcatel-Lucent to review a plan which at present foresees the closure of two sites and the possible sale of others.
Shares in Alcatel were 5.7 percent lower by 10:30 SA time at 2.613 euros for a two-day drop of 9.5 percent.
The stock had risen more than 80 percent in the three months leading up to Tuesday's announcement and remains up around 170 percent since the start of the year.
Under a labour law which came into force in June, the government must check to see whether any accord signed with unions adheres to regulations or not.
If there is no deal, the state will proceed to an in-depth check of the company's restructuring plan, including an assessment of whether it is appropriate given the group's assets and economic health.
Either way “if there is no approval by the administration, the company cannot fire people,” a labour ministry official said by telephone.
However CGT union representative Stephane Dubled played down the government's margin of manoeuvre, saying past experience showed governments were reluctant to get directly involved and that the new law was too recent to assess its reach.
“The state has some power in as much as it decides to use it ... but there hasn't been much experience of that so far,” Dubled told Reuters.
“There is a bit of grandstanding in Ayrault's comments.”
The product of a 2006 transatlantic merger aimed at creating a global giant, Alcatel-Lucent employs 72,000 staff worldwide and competes with larger rivals Ericsson of Sweden, China's Huawei and Finland's Nokia, has posted five straight quarters of net losses.
France's left-leaning industry minister Arnaud Montebourg, who has led a campaign for French consumers and companies to buy home-grown products, also called on the country's network providers to help the firm by favouring its products. - Reuters