Union chiefs have threatened legal proceedings against telecoms equipment maker Alcatel, claiming they were not consulted over 10,000 job cuts.

Jean-Pierre Clavaut, of the Communist-backed CGT union, said Alcatel should have consulted unions before Wednesday's announcement of cuts which will take Alcatel's workforce to 70,000 by the end of next year.

The firm employed 110,000 people at the end of 2001.

And Mr Clavaut said other unions had joined the CGT's campaign against Alcatel, which is claimed to have broken requirements set down in French labour laws.

"All the unions in the European sector have agreed to go to court," he said.

Shares slide

Alcatel shares plunged by 16.5% on Wednesday after the firm, which had been expected to post a small profit this year, warned it would turn in a loss.

Like most firms in the telecoms sector, Alcatel has seen demand shrivel dramatically over the past year, and it fell into the red in the first three months of 2002.

Wednesday's announcement dealt a blow to confidence in a firm which had been seen as more robust than rivals such as the UK's Marconi.

Alcatel shares shed a further 0.46 euros on Thursday to close at 7.35 euros.