Pilots, Oil Workers Strike As France Seeks Way Out Of Crisis

Air France pilots voted on Monday to go on strike and oil storage workers extended a job walkout, compounding the French government's woes as it scrambled to calm rolling protests against labor reforms ahead of the Euro soccer tournament.

After more than three months of tense talks, often violent street protests, and waves of strikes in the transport and energy industries, the Socialist government is under pressure to find a solution before the Euro 2016 kick-off on June 10.

As France braced for further nationwide rail strikes on Tuesday, people involved in the talks said the government's strategy was to push for deals with individual firms such as the state-run SNCF rail operator to try to blunt the momentum behind protests.

"The government is pushing for deals to be found," said aoneunion official familiar with the negotiations, requesting anonymity because of the sensitivity of the talks.

French weekly Le Journal du Dimanche quoted a person close to President Francois Hollande confirming the government approach, as did a Socialist lawmaker speaking to Reuters on condition of anonymity.

"The government absolutely needs this to find a way out," said another source close to the talks.

Prime Minister Manuel Valls, who insists the government will not scrap the law, spoke to trade union leaders by phone on Saturday. He told them he might be open to some changes, but not on any key elements.

Labor Minister Myriam El Khomri insisted on Monday that the government was standing by the bill that she drafted and which has already been watered down.

She said negotiations with the SNCF and the Paris metro operator, RATP, on work conditions marked an opportunity for unions "to stand up to their responsibilities."

Negotiations with the SNCF made progress at the weekend, said Luc Berille, the secretary general of pro-reform UNSA union, the second largest union in the company, told Reuters.

Guy Groux, a researcher at the Cevipof political institute said: "If there were deals at the SNCF or RATP (Paris metro operator), that could put an end to the protests or at least weaken them."

Meanwhile, workers at the CIM, an oil storage and supply services company which handles about 40 percent of French crude imports, voted to extend their strike at Le Havre port until 1000 GMT (6.00 a.m. ET) on Wednesday, a CGT union official told Reuters.

Pilots at Air France also voted to go on strike over pay conditions but have not set a date yet, the head of the SNPL union said on Monday.

Only two French refineries out of eight are operating but the situation at depots has improved from last week with only one now blocked.

"NO EASY WAY OUT"

The labor reform strikes are being spearheaded by the hardline CGT Union, France's largest union since 1945 but which is now being overtaken by the moderate CFDT that backs the labor bill. Groux said CGT leaders were under huge pressure from grass-roots activists to dig their heels in.

"Trying to find a deal with the government and call for an end to the protests would be, for (CGT chief Philippe) Martinez to take the risk not to be followed (by union members)," said Groux.

A majority of French expect the government to make some small amendments to the bill, due for a final reading in the lower house of parliament in July, but not withdraw it altogether as the CGT wants, said Frederic Dabi at Ifop pollsters.

"There is no easy way out," Dabi said. "We have two sides, both of whom are relatively fragile and who have irreconcilable differences."