Eikaiwa

Ex-Nova president sentenced to 2-year prison term for embezzlement

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The former president of English conversation school Nova was handed a two-year prison sentence for corporate embezzlement by the Osaka High Court on Dec. 2.

Nozomu Sahashi, 59, had been convicted of the offence by a lower court and sentenced to a three-year, six-month prison term in August last year. The high court decision on Sahashi’s appeal confirmed his conviction for embezzling money from employees, but reduced the sentence as the funds were used to pay back customer deposits and Sahashi did not himself profit from taking the money. Sahashi intends to appeal.

According to the lower court ruling, Sahashi wrote a check for the entire amount in the Nova employees’ Shayu-kai mutual aid fund account — some 320 million yen — and deposited it in an account held by a Nova-associated company.

“The entire purpose of the Shayu-kai was employee welfare, and you used it for an entirely different purpose,” said Presiding Judge Sumio Matoba in the high court ruling. “You were Nova’s primary shareholder, and there is no trace you ever committed to returning the money you took. Thus, this court can conclude that you had criminal intent when you embezzled the funds.”

Sahashi’s defense counsel argued that “The Shayu-kai did not exist as an independent entity, but was just one part of the company. The entire sum withdrawn was set aside for refunding customers, and thus was not embezzled.” Furthermore, “If Nova had not been able to refund its customers, it would have gone bankrupt, and Mr. Sahashi fully intended to return the funds once the company attracted new investment.”

Nova was founded by Sahashi, and at its peak had some 1,000 schools nationwide. However, it was ordered to suspend part of its operations by the Ministry of Economy, Trade and Industry in June 2007. Nova declared bankruptcy in October that year. A suit the company’s bankruptcy administrator filed against Sahashi for the recovery of over 2.1 billion yen is currently being heard at the Osaka District Court.

http://mdn.mainichi.jp/mdnnews/news/20101202p2a00m0na009000c.html

Cram school buys out Shane English School

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Cram school operator Eikoh Inc. said Friday it has acquired Shane English School to strengthen its English-language education for elementary school children ahead of the planned compulsory teaching of the language for fifth- and sixth-graders.

Eikoh, based in the Kanto region, didn’t disclose how much it paid for the acquisition of shares in the four operating companies that run the English school chain, which mainly operates in the Tokyo metropolitan area. [Other reports claim that around the purchase was for approximately 1 billion yen, or $12 million dollars, a similar amount as Eikoh paid for Nellie’s and Shane Language Services in early October 2010, both of which were also owned by Saxoncourt.]

Representatives of both Eikoh and Shane English School said the acquisition won’t involve personnel cuts or other drastic changes in operations.

Shane English School, a British English school owned by Saxoncourt Holdings, Ltd. based in the British Virgin Islands, operates 199 branches across the Kanto region, of which 46 are franchised.

[Eikoh Inc. business management division representative Hiroyuki ] Otsubo said Eikoh has no plans to change the number of teachers working for Shane English School and its roughly 20,000 students will continue receiving the same services.

Eikoh operates 380 cram schools and has 67,000 students. A press release from Eikoh said that in the Tokyo area, Shane already holds 60 percent of its classes in the same location as classes hosted by Eikoh.

Takehiko Kikuchi, a PR representative for Shane English School, said company employees and teachers received the news calmly.

http://search.japantimes.co.jp/cgi-bin/nn20101120a2.html

Companies going all-out in English

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Enhancing employee English-language skills has become a high-priority management challenge for Japanese corporations, regardless of their size and industry.

This is especially true for companies whose survival hinges on developing new customers or clients in foreign markets. They are focusing in particular on fast-growing Asian economies, where English is becoming the common means of communication.

Out of necessity, [a a midsize general engineering contractor headquartered in Kawasaki looking to expand in Asia] in spring 2009 launched an English-language training program targeting veteran engineers in their 40s and 50s suffering from “English-phobia,” [the senior general manager of sales] said.

Once a week for two hours, about 40 employees attend one of four classes based on their level of English proficiency. Four instructors — two Americans, a Briton and a Filipino — are dispatched to the classes from an English school. They cover topics ranging from telephone conversation and discussions in conferences to writing e-mail and preparing contracts.

“To double our oversea sales, we must at least double the number of engineers and other staff who have practical English-language skills”.

http://search.japantimes.co.jp/cgi-bin/nn20101120f1.html

Foreigners victims, perpetrators of sekuhara

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Japan sees progress on sexual harassment, but stories suggest it still has a long way to go

While the Equal Employment Opportunity Law (EEOL) was passed in 1985, it was not until 1999 that revisions to the law included definitions of sexual harassment and legal penalties for employers. These penalties, however, only allow for making the names of the offending companies public. They do not allow for the government to assess fines, nor for plaintiffs to seek punitive damages against the employer — something the U.N. Committee on the Elimination of Discrimination against Women (CEDAW) raised concerns about last year.

There has been, however, an increase in public awareness of sexual harassment in Japan. According to the Ministry of Health, Labor and Welfare, 8,120 women filed sexual harassment complaints with equal employment opportunity offices in 2008, compared with 7,706 in 2004 and 2,534 in 1997.

“Elizabeth” came to Osaka from New Zealand in her early 30s to work for the Nova English-language teaching chain, before its much-publicized bankruptcy and relaunch under G.communication. She had heard the oft-repeated mantra that Japan was one of the safest places in the world. For Elizabeth, however, life in Japan was anything but safe.

The company had housed her in a men’s hostel in Osaka. On her first day in Japan, a man grabbed her arm and pulled her towards him. She spoke no Japanese at the time, and could only understand one word he said: “hotel.” She eventually managed to break his grip and escape.

The harassment and assaults came on an almost daily basis — in the elevator, on the street and on the train. Strange men would ask for her panties — or simply climb up to her second-floor balcony and remove them from her drying rack. Men constantly approached her and asked her to accompany them to hotels; with her long, blond hair, they would assume she was a Russian prostitute, even after she attempted to convince them otherwise. Being molested on the train was a common occurrence — as it is for many women in Japan — and on one evening a man masturbated on the seat in front of her.

Her work at Nova offered no respite. She was assigned to work an 11 p.m. to 7 a.m. shift, providing lessons over the Internet. Men would engage in behavior ranging from taking her photograph to masturbating on live camera. Her complaints to her managers — both Western men — went unheeded. They were clients and they could do what they like, they would say.

On her way to work, a man on the train stuck his hand up her skirt and molested her. She had reached her breaking point. She arrived at her office in tears and told her managers of the assault.

“That’s going to happen a lot to you here,” one of them said, laughing. “You’d better get used to it.”

She had never in her life suffered the level of harassment and humiliation she experienced in those four weeks.

“I never felt so pimped out as I did at Nova,” she says. “The whole system was geared to put white women on show.”

http://search.japantimes.co.jp/cgi-bin/fl20101026zg.html

Gaba teachers challenge ‘contractor’ status

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Union fears employment model could mark first step on slippery slope for eikawa firms

Long accustomed to being ignored, being forgotten proved too much to take for unionized teachers at Gaba language school. On Oct. 4, the General Union registered an official complaint and request for an investigation with the Ministry of Finance’s Securities and Exchange Surveillance Commission (SESC).

The union accuses Gaba Corp. of lying in its 2009 financial report filed in March with the Tokyo Stock Exchange, which states that there is no union at Gaba and that labor-management relations were “smooth and harmonious.”

The G.U. argues it has an established Gaba Branch. Its complaint also points out that the Osaka Labor Commission ruled in December 2009 that it considered earlier negotiations held between the union and Gaba to represent collective bargaining.

The union also charges that the financial statement’s description of Gaba instructors as independent contractors rather than employees is disingenuous. The complaint points out that the Osaka commission also acknowledged Gaba’s instructors as employees under trade union law last December, and that the firm’s failure to mention that fact was misleading.

The SESC complaint is tied to a larger struggle for union recognition and employee rights at Gaba.

Instructors first formed a union in September 2007 and, according to union members, met with company representatives for talks. However, managers always refused to enter into serious negotiations, arguing the instructors were not employees and, as itaku — independent contractors — weren’t covered by Japanese labor laws.

Determining who qualifies as an employee and who can be classed as an independent contractor isn’t always clear. However, the method in which workers are scheduled and their place of work are important considerations.

“The company must be very careful it’s not treating them as employees,” says [Christopher] Gunson [an international transaction attorney]. “Even having someone in an office and working with an employee is risky.”

Gaba instructors are not alone in their fight for recognition as regular employees. According to journalist Naoki Kazama’s book “Koyo Yukai” (“Employment Meltdown”), there are no official statistics for the number of independent contractors working in Japan, but estimates range from 500,000 to 2 million workers.

Japan’s Statistics Bureau’s annual Labor Force Survey shows the number of nonregular workers has increased steadily since 1999, after the Japanese government started relaxing regulations to make it easier for companies to hire workers outside their regular employment system. In 1999, 25.6 percent of Japan’s labor force was classified as nonregular. By 2009 the figure had increased to 33.7 percent.

Employing instructors as independent contractors allows Gaba to reduce labor costs.

Instructors receive no paid sick days or vacation, no pay for training, no overtime pay, and there’s no limit on the number of unpaid overtime hours that can be worked. The company also avoids enrolling its instructors in unemployment insurance, the national health insurance and pension schemes, and workers’ compensation. It also fails to pay a commuting allowance to instructors.

The instructors, working on six-month contracts, also lack job security. Employment as independent contractors means Gaba can dismiss any teacher, with or without cause, simply by not renewing their contract.

http://search.japantimes.co.jp/cgi-bin/fl20101019zg.html

50 Geos branches will be renamed

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Nagoya-based investment fund Inayoshi Capital Partners said Thursday that about 50 of its 167 Geos foreign-language school branches will be renamed Nova X Geos after November.

ICP also said it will close down about 20 Geos branches whose business areas are overlapping with those of Nova.

The company said students of those schools will be relocated to the nearby Nova schools or receive lessons via Nova’s unique video-phone system.

Subsidiary G.education Co. “made a comprehensive judgment” on the chain’s operations, ICP spokeswoman Namiko Kameyama said.

G.communication took over the operations of Geos six months ago, after the chain filed for bankruptcy with net debts of ¥7.5 billion.

The corporation purchased Nova in 2007 after that chain went bankrupt.

http://search.japantimes.co.jp/cgi-bin/nn20101015a9.html

Retooled English school chains set to launch Nova x Geos brand

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Nova x Geos, a new English conversation school brand integrating branches from the Nova and Geos chains, is scheduled to be established on Nov. 1, according to the chains’ parent firm.

Masaki Inayoshi, chairman of investment company Inayoshi Capital Partners, said Wednesday that about 50 of Geos’ 167 branches nationwide would adopt the new brand and start using Nova curriculums.

The Geos branches involved are located in neighborhoods where there is no competing Nova branch.

Inayoshi Capital said it intends to close about 20 Geos branches that do compete head-to-head with Nova branches, and also plans to integrate another 20 Geos branches with cram schools.

http://www.yomiuri.co.jp/dy/business/T101014003658.htm

Language Schools Nova, Geos Get Yet Another New Owner

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Restaurant operator G.communication Co. has sold its subsidiary that runs the language schools Nova and Geos to an investment fund managed by its founder and former chairman.

The Oct. 1 transaction was apparently triggered by the fact that G.communication’s parent company, Foody’s Co., has been hit hard by the recent failure of Incubator Bank of Japan. Investors to Foody’s include businesses with close ties to the bank.

G.education Co. had just taken over the operations of Geos this April after the school’s previous operator went belly up. G.education acquired Nova’s operations in 2007 following the bankruptcy filing of the school’s former operator.

G.education is now 66% owned by the investment fund, which is headed by Masaki Inayoshi.

http://e.nikkei.com/e/fr/tnks/Nni20101006D05JFA03.htm

Geos, Nova English schools change ownership once again

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G.communication Co. has sold off the failed English conversation school chain Geos, which it took over in April, along with the Nova chain of English schools, The Yomiuri Shimbun has learned.

An investment company led by Masaki Inayoshi, who formerly served as chairman of G.communication, purchased the subsidiary of the Nagoya-based firm that ran both Geos and Nova, under a contract that took effect Friday, informed sources said.

Inayoshi’s purchase of the two English school chains followed a decision by Foody’s Co., the parent of G.communication, to withdraw from the operation of Geos and Nova. The decision came in the wake of the bankruptcy on Sept. 10 of Incubator Bank of Japan, the major banking partner of Foody’s, according to the sources.

The failure of the bank gave rise to concern over Foody’s financial management. Foody’s engages mainly in extending financial and human resources backing to restaurants and related businesses, they said.

Nova has 490 locations and Geos 167.

The firm newly in charge of running the Nova and Geos schools says it expects no major problems with their operations, the sources said.

http://www.yomiuri.co.jp/dy/business/T101005004522.htm

Nova, Geos now under investment fund’s wing

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Nagoya-based G. communication Co. last week sold Nova Corp. and Geos Corp., two major foreign language school chains, to an investment fund.

The fund, Inayoshi Capital Partners, run by recently retired G. communication founder Masaki Inayoshi, acquired the stakes Friday by purchasing shares of G. education Co., a G. communication spokeswoman said.

Seven Geos language schools overseas, in Singapore, Hong Kong, Taiwan and Thailand, will remain G. communication subsidiaries.

“Both Nova and Geos will continue their operations, and we believe this will not affect the students,” the spokeswoman said, adding both brands will be maintained.

G. communications took over the operations of Geos just six months ago after the chain filed for bankruptcy with net debts of ¥7.5 billion.

The corporation purchased Nova in 2007 after the school chain went bankrupt.

The spokeswoman said the decision to sell off the two school chains was made because Kobe-based food and beverage distributor Hanshin Shuhan Inc. is poised to become the parent company of G. communications and wants to focus on its mainstay business.

Tokyo-based Foody’s Co. now owns a majority in G. communications but has agreed to sell its entire stake to Hanshin Shuhan.

According to the Asahi Shimbun, Foody’s is planning to sell its stake partly because of expected financial difficulties due to the recent bankruptcy of its main creditor, Incubator Bank of Japan.

Foreign-language schools have seen a decline in sales and enrollment recently.

According to the trade ministry, average monthly sales at language schools fell to ¥5.1 billion this year from ¥8.1 billion in 2007. The corresponding monthly enrollment figure decreased to 335,827 from 619,642 students.

http://search.japantimes.co.jp/cgi-bin/nn20101005x3.html