Nova

Nova used to pay teachers their salaries on the 15th of each month. As of last Friday, however, many teachers had not been paid. Some teachers say they are still owed for September, too.

That led some teachers at Nova schools in Osaka and Tokyo to go on strike. Several of those schools decided to close their doors temporarily last week.

At the end of March, Nova had more than 3 billion yen in cash and deposits.

However, it has continued to bleed cash since then, doling out millions of yen in salaries, refunds and office rental payments.

“Nova is in a precarious day-to-day financial situation,” said one source at a banking institution. If its circumstances don’t improve quickly, Nova may end up suspending all operations completely.

http://www.asahi.com/english/Herald-asahi/TKY200710220056.html

AROUND 2500 Australians working in Japan as English teachers could be left stranded if school operator Nova Corp goes under.

Union spokesman Katsuji Yamahara warned yesterday that in a worst-case scenario, the Australians would have to try for scarce new jobs or go home in despair. Already they are working without pay.

Mr Yamahara ? who is chairman of the General Union which represents Nova workers ? says the company has delayed paying salaries for 5000 Japanese workers and foreign teachers.

“The school has failed to pay Japanese workers’ salaries since July this year and foreign teachers working in Tokyo and Osaka regions since September,” he said.

The union has asked officials in Osaka to urge public prosecutors to build a criminal case against Nova Corp and its president Nozomu Sahashi in connection with the Labour Standard Law.

Nova is Japan’s largest language educator with 900 schools.

Its financial situation has greatly been damaged after the Economy, Trade and Industry Ministry ordered the company in June to suspend part of its operations for six months for violating industry laws.

The ministry blamed Nova for using fraudulent advertisements when soliciting students.

Officials also accused the company of lying about refunds of paid tuition in cases where such refunds had not been properly carried out.

The ministry told Nova not to sign long-term contracts.

Since then, the schools group has suffered a major decline in the number of new students.

The Australia Asia Centre for Education Exchange has already announced that it would stop placing teachers with Nova as of October 1.

According to a Nova spokesman, the operator was running 925 schools nationwide as of March this year.

The number of foreign teachers stood at 5054 then. But industry sources say the number of foreign instructors has fallen to 4500 including 2500 Australians.

By comparison, the number of Australians teaching in Japan under the government-run JET Programme stood at 316 in fiscal 2007.

Tristan Sime, a 37-year-old Australian who taught at Nova schools for seven years, said: “Brand-new Australians who recently came to Japan and have no Japanese language skills or other resources to find a new job had better go home if they are fired or the school goes bankrupt.”

He said it would be difficult for other language schools to hire new foreign teachers because the Nova problem had damaged the image of English language education.

Mr Sime criticised some of Nova’s rules as restrictive.

“No social contact with students has been allowed for Nova foreign teachers, even for coffee,” he said.

He said some of his friends teaching at Nova were fired after they attended parties for students and teachers held outside school hours.

http://www.news.com.au/couriermail/story/0,23739,22602956-953,00.html

A labor union representing teachers at scandal-hit English-language school operator Nova Corp. submitted a petition Tuesday to the Osaka labor standards authority, asking it to seek an indictment of the company and its president Nozomu Sahashi on charges of a breach of labor standards laws.

The General Union [Tokyo Nambu’s sister union] asked the Osaka Central Labor Standards Supervision Office, an arm of the Ministry of Health, Labor and Welfare, to have public prosecutors build a criminal case against the company and Sahashi over a delay in payment of wages to its foreign instructors.

According to the union, wage payments for Nova’s some 4,000 foreign instructors are usually made in the middle of the month. But they were delayed in September, and the company has notified the instructors that payments for October will also be delayed until Friday.

In late September, the union filed a request with labor authorities asking that Osaka-based Nova be ordered to pay the wages. The authorities have since recommended on a number of occasions that the company improve its practices related to labor standards.

Article 24 of the Labor Standards Law stipulates that companies must pay wages to employees at least once a month, on a fixed date.

Nova, an industry leader, has been hit with decreasing student enrollment and numerous canceled contracts since the government ordered the school in June to suspend part of its operations for lying to consumers in advertisements about its services.

The resulting financial plight apparently is making it increasingly difficult for the company to meet its workers’ wage claims.

http://www.tmcnet.com/usubmit/2007/10/16/3017057.htm

Three more former students of the beleaguered English conversation school NOVA have sued it over repayment of funds for cancelled contracts.

The group of three filed a lawsuit with the Tokyo District Court demanding that the Osaka-based conversation school chain repay a total of 1.46 million yen because of unfair accounting practices when returning money when contracts are cancelled.

The lawsuit is the second wave of legal action against NOVA backed by a group of Tokyo lawyers working pro bono to help students of the conversation school who feel they have been mistreated.

The three plaintiffs in the lawsuit filed Monday are all company employees who live in Tokyo.

In June, the Ministry of Economy, Trade and Industry slapped a six-month ban on NOVA making long-term contracts because of the chain’s mishandling of the cancellation of contracts.

http://mdn.mainichi.jp/national/news/20071016p2a00m0na025000c.html

Australia is offering consular assistance to its nationals who are working in Japan for struggling, scandal-hit language school chain Nova Corp., Foreign Affairs Minister Alexander Downer said Friday.

“We’ll provide them with consular assistance if they need it,” he said. “If they get into real personal difficulties, we’ll obviously help them out.”

Some 1,300 Australians work for Nova and face the real possibility of losing their jobs while living in a very expensive country, he said.

While Nova has not gone completely bust yet, Downer said he fears the company would “fall over.”

Nova has been operating on shaky ground since June, when the Ministry of Economy, Trade and Industry ordered it to suspend part of its operations for lying to customers in advertisements about its services.

Since then, Nova has been hit with decreasing student enrollments and canceled contracts.

Some 4,000 foreign teachers are currently registered with Nova in Japan, with many coming from Australia and New Zealand.

Several foreign Nova workers have complained to media in Australia and New Zealand that they have not been paid recently.

Downer said he believes Nova’s operating difficulties were due to poor management and would not have broader implications for Japan’s English-language teaching market.

“I think there is growing demand for English-language teaching in Japan. So I think we needn’t be pessimistic about it in a broader sense. We just need to think about the 1,300 Australians who are suddenly finding themselves out on the street there in Japan,” he said.

Australia Asia Centre for Education Exchange, an Australian company coordinating international education exchange programs, has stopped dispatching teachers to Nova.

The body said on its Web site that following the abrupt closure of some Nova schools and Nova’s delayed payments to instructors, it ended its recruitment relationship with the Japanese company Oct. 1.

http://search.japantimes.co.jp/cgi-bin/nn20071013a1.html

Consular assistance is being offered to 1,300 Australians whose English-teaching company in Japan is going bust, Foreign Affairs minister Alexander Downer says.

Mr Downer said some of the teachers would return to Australia, while others would simply get another job.

Last month, the Osaka-based Nova Corporation reassured their 7,000 staff, 5,000 of whom are foreigners, that the company was not going out of business.

However, Mr Downer said on Friday that although the company had not “completely fallen over yet”, it would “fall over”, leaving 1,300 Australians financially stranded in a “very expensive” country.

“We’ll provide them with consular assistance if they need it,” he told ABC radio. “If they get into real personal difficulties, then we’ll obviously help them out.

“Otherwise, if they cannot find another job in Japan, then they’ll return to Australia.”

Mr Downer said there were no broader implications to the company’s collapse, it was simply going out of business through poor management.

“It is not as though people in Japan no longer want to learn English, or there has been a complete shift in the whole market, that’s not right,” he said.

http://www.theage.com.au/news/National/Aussies-lose-teaching-jobs-in-Japan/2007/10/12/1191696140832.html

Major English-conversation school operator Nova Corp. is struggling to pay refunds for prepaid lessons to students who canceled their contracts with the company midterm and has had difficulty paying employees’ salaries, according to sources.

The Osaka Chuo Labor Standards Inspection Office in Osaka has instructed the Osaka-based company four times to pay wages to its workers that it has owed since July.

Nova has completely changed its “expansionary course” business strategy. It had closed about 50 schools in Tokyo and surrounding areas and Osaka as of Sept. 30 and drastically cut its TV commercials and other advertising.

Nova has to refund large amounts of money in many cases because students have to prepay lesson fees, often for hundreds of classes, when they sign contracts with the company.

According to Nova, the number of contracts canceled increased sharply after the Supreme Court ruled in April that the company’s unfair cancellation policy was illegal. Nova had 418,000 students as of March 31, but there were 7,880 cancellations between April and June, which cost the company 1.62 billion yen in total.

Cancellations continued after the Economy, Trade and Industry Ministry ordered the company to partially suspend its operations in June, judging that its sales pitch to students violated the Specified Commercial Transactions Law. The ministry said that Nova falsely explained to students that lessons can be reserved any time they want, and made exaggerated claims in advertisements during a special campaign offering free sign up.

Since June, consumer centers in Tokyo have received several dozen complaints and requests for consultations. In one case, a caller said, “I haven’t received a refund from Nova even though I canceled lessons more than three months ago.” Consumer centers around the nation are receiving similar complaints, according to the sources.

If students sign a contract with Nova to pay tuition with a credit card in installments and Nova did not refund fees for cancelled classes, they can refuse to pay the charges to their credit card company. However, if students paid cash in advance for lessons and then canceled their contract, there is little they can do but wait for Nova to refund the money.

There is no legal deadline for refunding lesson fees upon cancellation, but the Tokyo metropolitan government has instructed Nova to pay such refunds as soon as possible. Representatives of the National Union of General Workers Tokyo South in Minato Ward, Tokyo, and General Union in Osaka, of which some of Nova’s foreign teachers are members, requested METI on Tuesday to instruct Nova to refund the fees promptly.

Economy, Trade and Industry Minister Akira Amari said at a press conference Tuesday that Nova needs to make sincere efforts to solve the problems. “We’d like to respond to the problem in areas where the ministry can intervene,” he said.

Nova has not paid salaries to 2,000 Japanese employees since July. About 5,000 foreign employees have not yet received their salaries for September.

A senior foreign teacher working in a Nova’s school in the Kinki region said, “An instructor I know has been asked to leave his apartment rented by Nova because the company has failed to pay the rent.”

A Japanese employee working at one of schools in Tokyo said when he asked Nova’s headquarters the reason for the delay in salary payments, the person he spoke to simply said, ‘I don’t know.’ “Because there isn’t enough information about why the schools were closed and why the refund has been delayed, it’s difficult for me to explain about the matter to students,” he said.

http://www.yomiuri.co.jp/dy/national/20071010TDY02305.htm