France set to redefine 35-hour working week, PM says

PARIS (Reuters) - France will give companies the right to negotiate longer working weeks and overtime pay, Prime Minister Manuel Valls said on Monday, changes to the 35-hour week that face resistance from increasingly vocal rebel Socialist lawmakers and unions.

Fiercely guarded by the workforce, and a flagship reform of the Socialist government during a boom in the late 1990s, the relatively short working week was meant to stoke job creation.

Instead, many employers say it has bloated labour costs and hurt their ability to compete globally, a view echoed by right-wing politicians, foreign investors and many economists.

"Exemptions to the legal duration of working time at 35 hours is no longer a violation of the law," Valls said after receiving a report with reform proposals from former Justice Minister Robert Badinter.

President Francois Hollande's Socialist government is due to outline a draft reform in March, in what is likely to be one of the last big policy drives of his term in office.

Although the government expects a re-draft of the 3,800 pages of the labour code to take years, a revamp of the 125 pages on working hours will be presented to cabinet on March 9.

The government has promised not to unstitch statutes stating that the legal work week is 35 hours, which will be part of a framework of rights that will remain enshrined in law and not modifiable by employers and unions.

However, issues such as the adjustment of working hours over a day, a week or a year, rest time, and paid leave or overtime pay will be adjustable through collective agreements.

Valls said pay for overtime worked beyond 35 hours would be written into the bill and that compensation would be calculated "differently" to now. Employees currently must receive at least 10 percent on top of their usual pay under existing law.

(Reporting by Elizabeth Pineau; Writing by John Irish; Editing by Louise Ireland)