Under threat of fines or dismissal, workers are being forced to buy shares in their companies, with unpaid wages sometimes being converted into equity. The government has sanctioned the sell-off of tens of thousands of small and medium-size state firms, with a buyout by workers and managers one of the most common methods. In practice, provincial and city governments are reluctant to sell profitable companies and prefer to dispose of loss-making firms that have become a financial burden to the treasury. The Workers Daily yesterday said that compelling workers to buy shares in their companies had become commonplace. In Shangrao, Jiangxi province, employees had been given 10 days to choose one of two alternatives: pay 3,000 yuan (about HK$2,789) to buy shares and remain employed or take a one-time pay-off from the firm and forego future pension, medical and other benefits. In another city in Jiangxi, a trading company employing about 200 had instructed staff to pay 3,000 yuan each and managers 5,000 yuan to take over the company. It quoted workers in a factory in Nanchang, the provincial capital, as saying that they had in the past contributed to their company to keep it afloat and preferred not to again but felt obligated to or face unemployment. Some companies have gone even further by converting unpaid wages into shares or threatening workers who did not buy shares with fines and the loss of pension and welfare benefits they had paid for. Workers do not want to buy shares in a firm when they see no prospect of its economic performance improving. This would require a change in its managers - but they usually retain their positions after a buyout and often enhance it by buying a large proportion of the shares. One economist in Beijing said that these worker-management buyouts of state firms had become like a political campaign, despite the governments instructions that they should be fully voluntary. It is the workers who lose out. They are not consulted and usually give in because the alternative is dismissal. They get shares that are not tradeable and may yield no dividend, he said.