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Swiss Foreign Minister Ignazio Cassis gestures during a news conference in Bern, Switzerland July 4, 2018. REUTERS/Stefan Wermuth

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By John Revill and Brenna Hughes Neghaiwi

ZURICH (Reuters) - Switzerland said on Wednesday it had put further talks on a new treaty governing relations with the European Union, including sensitive labour market rules, on hold until after the summer break.

Negotiations to formalise ties now covered by around 100 separate accords have stumbled in recent weeks with Swiss leaders conceding that Britain's planned exit from the EU has made it more difficult to clinch a deal.

Talks have snagged in particular on Switzerland's wish to protect its own labour market and the pay and conditions for Swiss-based workers, with Foreign Minister Ignazio Cassis describing this as a "red line" not up for negotiation.

Brussels has said Switzerland must agree a full treaty before it gets greater access to EU markets.

Progress has been made towards resolving several points of contention, particularly on the solution of legal disputes through arbitration panels, the Swiss government said.

But open questions remain in the areas surrounding the free movement of people, it added, particularly measures to protect the pay and conditions of workers in Switzerland.

"By and large, we've come a step closer, but we're not yet at the finish," Cassis told a news conference on Wednesday. "Nothing is agreed until everything is agreed; it's an everything or nothing process."

The Swiss government wants to carry out deeper discussion with the country's semi-autonomous cantons and groups like trade unions to resolve differences before talks resume, he said.

Brussels is pushing Bern to agree a treaty this year before elections in Switzerland and the EU scheduled for 2019.

It has warned it will not grant the Swiss more access to the EU's 28-nation single market - the biggest for Swiss exports - in the absence of an "institutional agreement".

Cassis refused to be rushed, saying the government was prepared to let a deadline on the current talks lapse.

"The Federal Council (Swiss cabinet) considers the internal political situation to be more important than the timetable. Quality comes before timing," he said.

"Either the agreement fits qualitatively...or it doesn't, and Switzerland presses forward," he said, adding Switzerland could re-examine the issue later.

The EU on Wednesday characterised the talks as "difficult."

"We take note of today's discussions," a spokeswoman for the European Commission said. "Negotiations will continue next week and they will remain difficult."

(Reporting by Brenna Hughes Neghaiwi and John Revill; Editing by Mark Heinrich)

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