PARIS (AFP) - A union covering workers at a landmark luxury Paris hotel said on Sunday they are suing the establishment for planning to lay off some staff during a three-year renovation.

The Lutetia Hotel, an Art Nouveau building in the heart of the French capital's chic Saint-Germain district, would be committing "fraud" if it invoked economic reasons to sack employees who refused to suspend their work contracts, the CGT union said in a statement.

The four-star hotel has promised to put all its existing 220 staff back in their jobs once the make-over starting next April is complete, but only if they accepted reduced pay on a suspended contract until then. Any who refused were given the option of taking a redundancy or being sacked.

"Firing people for economic reasons implies by definition the scrapping of their job. But in this fairly uncommon instance, our lawyer informs us that is not really the case," said a CGT representative, Mr Claude Levy.

The case is to be heard by a Paris court on January 14.

The Lutetia Hotel, whose famous guests included Pablo Picasso, Charles de Gaulle and James Joyce, was taken over by German officers occupying Paris in World War II.

In 2010, the establishment was bought by an Israeli real estate group, Alrov.