(Adds Fiat statement para 3, 7-9)
By Tonia Mastrobuoni
ROME, Nov 29 (Reuters) - Talks between Italian unions and crisis-hit carmaker Fiat over 8,000 planned layoffs hit deadlock on Friday, a union official told reporters.
"The negotiations have completely stalled," said Gianni Rinaldini, head of the Fiom metalworkers' union, who demanded that a top government official got involved in the discussions.
"The conditions are not there for an agreement on the positions taken by the company, and we want a high-level government representative."
Fiat countered that it had proposed "significant changes" to its do-or-die recovery plan to the unions, including making pledges to reinstate a "substantial" number of workers once its industrial overhaul was operational.
Under intense pressure to pare back a pile of debt and revive its troubled car arm, Fiat is planning a radical restructuring, which includes laying off more than 8,000 staff for at least a year.
Unions and the government are negotiating with the firm to try to limit the job losses. Unions said Fiat had told them on Friday that half of the laid-off workers would not be rehired.
Fiat said later that it had promised to invest 35 million euros next year in a Sicilian car plant that has been at the centre of feuding and that unions originally believed was earmarked for closure.
The company said it would be reopened by December 2003.
Unions said they wanted assurances that all of the workers at the Sicilian plant will be reinstated.
MINISTRY MULLING PLAN
Riccardo Gallo, representing the Industry Ministry at the talks, said his boss, Minister Antonio Marzano, should assess the latest changes to the plan proposed by the company.
Earlier, the unions had proposed temporary layoffs of one week a month, rotating from plant to plant, saying this would help prevent complete plant closures. But one union leader said the company had rejected the proposal.
Over the past month, angry workers at Italy's largest private employer have downed their tools, marched and blocked a Sicilian port and airport.
The metalworking divisions of Italy's three main unions have pledged at least six hours of strikes before December 5, the deadline for Fiat, the government and unions to approve the industrial plan.
Fiat is trying to slash its net debt to 3.6 billion euros by early 2003 from 5.8 billion at the end of September, as agreed with its creditors as part of a restructuring effort that includes cutting inventories and unprofitable sales.
The first wave of planned layoffs has been delayed for two weeks while Fiat negotiates with the unions.
If Fiat retreats too far, it risks backing into ratings agencies that are reviewing its debt in light of a plan, involving investments of 2.6 billion euros a year, to remodel its slow-selling cars.
Most analysts expect Fiat to put the regular crises at its carmaking arm behind it eventually by selling its 80 percent stake in Fiat Auto to partner General Motors Corp. under a put option that starts in 2004.