France looks to ease Sunday shop opening curbs

PARIS (Reuters) - The French government pledged on Monday to ease a general ban on Sunday shop openings, injecting a limited dose of flexibility into the highly regulated retail sector. The Socialist government is eager to defuse a standoff between retailers and labor unions over the Sunday ban, which some employers say is holding back hiring. With unemployment at a near record 10.9 percent, when stores can open has become a hot political question for President Francois Hollande's unpopular government. Prime Minister Jean-Marc Ayrault, taking delivery of a government-commissioned report that suggested greater flexibility, said the ban should stay but that laws should be revamped to reflect the report's findings. "We mustn't waste time and must find a temporary solution for certain difficult cases," Ayrault told a news conference. "Sunday is not a day like others and we don't want it to become one." He said new legislation would be proposed next year and that in the meantime DIY stores would not be forced to shut every Sunday. Hardware stores Leroy Merlin and Kingfisher-owned Castorama have risked hefty fines to open on recent Sundays in the Paris region in defiance of a court order to close. The author of the report, Jean-Pierre Bailly, said the thrust of the reform would be to allow local authorities to designate more Sundays when shops, notably those in the home decorating and furnishing sectors, could open. A Castorama spokesman said that the report was a "good basis to start from" and a Leroy Merlin spokesman said its findings were a relief. Both companies, which say opening on Sundays is key to fighting competition from Internet vendors, pay staff two and a half times the normal pay rate to work on Sundays. The battle over Sunday opening restrictions has fuelled a wider debate over the balance between state protection of rest time and employment opportunities in a country with a 35-hour work week. According to a survey by French union CFDT, 60 percent of people under 25, an age group whose jobless rate is close to 25 percent, favor working on Sunday. However, the same survey found that 68 percent of people with a job did not want to work on Sundays. Household spending is the traditional motor of the French economy, so looser regulation of the retail sector could boost job creation and consumers' purchasing power, the Organization for Economic Cooperation said in a report on French competitiveness last month. Though generally cautious about such reforms, the government is desperate to boost the euro zone's second-biggest economy. A survey on Monday showed French manufacturing activity shrinking in November at its sharpest pace since June. (Reporting By Brian Love and Pascale Denis, writing by Leigh Thomas; editing by Mark John/Ruth Pitchford)