Chirac gives ground on jobs law - but refuses to scrap it

The French President Jacques Chirac last night offered a series of bizarre concessions on the youth job contracts which have brought France to the brink of a deep political crisis.

He announced that he would sign the new law but order the government to, in effect, suspend and amend it. Appealing to students and trade unions to end the protests which have been hijacked by a violent fringe, M. Chirac called a conference to discuss employment law and job "insecurity".

His proposals, in a nationwide television and radio address, were dismissed by student and trade union leaders as "ridiculous" and "worthy of a banana republic".

M. Chirac insisted that, in a democracy, he had no choice but to sign and "promulgate" any law which had been approved by parliament. Student leaders and trade unions had warned that a signing of the law by the President would be a "provocation" that would plunge the country into even deeper crisis.

M. Chirac said that he would order the government to amend the most contentious parts of the "first jobs contract". Until those amendments were passed, he said, the government would ensure that not a single new youth contract would be used in the workplace.

M. Chirac said that it was time "in the national interest ... to defuse the situation and move forward."

Last night trade union leaders called for the continuation of new nationwide strikes and demonstrations planned next Tuesday.

Under the Contrat Premèire Embauche, young people would be given a two-year trial period in which they could be fired at any time without explanation. This was intended to encourage employers to hire young people. M. Chirac said that he would order the government to bring forward a new law reducing the trial period to 12 months, and giving young people a right to an explanation if they were sacked.

Students last night occupied town squares across France. M. Chirac's address, played on radios, was booed by the students.