Major travel agency H.I.S. Co. may form an alliance with Nova Corp., the English conversation school operator struggling under a government order to partially suspend operations, sources said.
H.I.S., known for its sales of discount airline tickets, is leaning toward providing financial support to the nation’s largest conversational English school in return for a chance to recruit its students as customers, the sources said.
http://www.asahi.com/english/Herald-asahi/TKY200707030119.html
The Economy, Trade and Industry Ministry issued a document in June 2002 that tolerated English conversation school industry leader Nova Corp.’s controversial practice of minimizing refunds of students who terminated their contracts, according to sources close to the issue.
Four months before the document was issued, the Tokyo metropolitan government began its own administrative procedures against Nova, criticizing the Osaka-based chain’s refund method as being detrimental to departing students.
But because the ministry’s document said the refund method was not wholly illegal, the metropolitan government discontinued its administrative procedure.
Nova had continued its refund calculation method until March, when the Supreme Court ruled it illegal.
Under the practice, when long-term students–mostly those with three-year contracts–terminated arrangements, the price of lessons already taken were calculated at higher amounts than agreed at the contract-signing.
The students received less of a refund than they expected.
When the ministry ordered Nova to suspend business June 13 under the Specific Commercial Transaction Law, it pointed out the refund method was unlawful if students attempted to terminate contracts for reasons such as difficulty in booking lessons.
However, the ministry’s June 2002 Nova document, distributed to regional ministry bureaus nationwide, noted the calculation method did not necessarily limit student rights to terminate contracts.
As Nova’s practice of calculating higher prices for lessons was actually applied to some forms of contracts, the document said, “It cannot be said the method lacks rationality.”
Nova also nullified unused points purchased by students in advance to take lessons, when students terminated contracts.
In the wake of numerous complaints on terminating Nova contracts received by consumer consultation centers, the ministry’s Consumer Affairs Policy Division drafted the document after interviewing Nova executives.
Copies of the document were distributed to the ministry’s regional bureaus, prefectural governments and consumer consultation centers, effectively allowing Nova to continue using the calculation method.
In February 2002, four months before the document’s issuance, the metropolitan government began its own administrative procedures against Nova, demanding the company review its business practices, including the refund calculation.
Other problems included false explanations to potential students that they would be able to book lessons at any time, and faulty contract forms.
The metropolitan government said Nova admitted in March that employees had made mistakes in judgment when they made sales pitches to potential students, and that Nova promised to correct the problem.
But Nova declined to discuss its refund calculation method with the metropolitan government and said it would take action after consulting the ministry.
When the ministry presented its opinion in the June 2002 document, the metropolitan government could not continue administrative procedures against Nova.
The number of complaints about Nova received by consumer consultation centers continued to increase even after the ministry issued the document.
The number steadily rose from 855 in fiscal 2002 to 982 in fiscal 2004, and to 1,088 in fiscal 2005. In fiscal 2006, the number reached 1,967, accounting for 53 percent of all complaints about foreign language conversation schools.
In September 2005, a consumer organization demanded Nova review the refund calculation method. Nova replied that it calculated prices for terminating contracts based on consultation with administrative authorities.
An official of the Consumer Affairs Policy Division said: “The government presented its view for a case that caused numerous complaints. Though the document was a reply based on Nova’s explanation that students could book enough lessons, we can’t deny it was later used for Nova’s convenience.”
Koji Niisato, a lawyer with expertise in consumer affairs, said: “It was already widely known more than 10 years ago that there were numerous complaints about Nova. As many former Nova students had to forfeit a lot of money without the chance to file lawsuits, the administrative authorities bear a heavy responsibility.”
“The [ministry’s] interpretation of the refund calculation method was denied by the Supreme Court. It’s obvious the ministry magnified the financial pitfalls endured by Nova students. The ministry can’t deny it made the judgment for corporate rather than consumer interests,” he said.
Nova Corp. President Nozomu Sahashi on Thursday refused to resign from the top post at the largest English-language school operator in Japan over a scandal involving exaggerated advertisements.
His refusal came in response to a call for his resignation from Nova shareholders who asked him at their annual meeting to resign to take responsibility for the scandal, which has led to a government order partially suspending Nova’s business operations.“If I resign, the company will collapse,” Sahashi told the meeting in Osaka.
Sahashi apologized for causing the disciplinary action by the government and said Nova has created a management reform committee to investigate the scandal and consider how best to avoid scandals in the future.
The committee, consisting of four experts on corporate compliance, will compile an interim report by the end of July and a final one by the end of August, he said.
The committee is expected to look into Sahashi’s responsibility and other issues related to the scandal.
The slogan of high school sport associations could be: If you can’t beat ’em, ban ’em.
The associations have introduced tough restrictions on foreign students because they are trouncing the Japanese athletes in sports such as the ekiden relay marathon, basketball and table tennis.
The restrictions followed protests from Japanese fans who say the superior ability of the foreign students is making the sporting events dull.
http://www.asahi.com/english/Herald-asahi/TKY200706290152.html
FUKUROI, Shizuoka Prefecture– Fearful that they would be inviting crime to their neighborhood, residents blocked an attempt by a Japanese-Brazilian man to buy land on which to build a house.
The local regional legal affairs bureau said their actions constituted a “violation of human rights” and told the parties involved that if a similar situation occurred in the future they should handle it better.
In the end, the man was forced to purchase property elsewhere.
http://www.asahi.com/english/Herald-asahi/TKY200706290148.html
Nova Corp President Nozomu Sahashi on Thursday refused to resign from the top post at the largest English-language school operator in Japan over a scandal involving exaggerated advertisements. His refusal came in response to a call for his resignation from Nova shareholders who asked him at their annual meeting to resign to take responsibility for the scandal, which has led to a government order partially suspending Nova’s business operations. “If I resign, the company will collapse,” Sahashi told the meeting in Osaka.
Sahashi apologized for causing the disciplinary action by the government and said Nova has created a management reform committee to investigate the scandal and consider how best to avoid scandals in the future. The committee, consisting of four experts on corporate compliance, will compile an interim report by the end of July and a final one by the end of August, he said.
Executives of scandal-tainted companies bowed deeply in remorse at shareholder meetings on Thursday as stockholders who are aggressively expanding their stakes in companies are gradually making their presence felt.
Nova Corp., the scandal-hit operator of the nation’s largest English-language school network, held its shareholder meeting in Osaka. The company was in the red in the business year ending in March for the second consecutive year.
The Economy, Trade and Industry Ministry has suspended some of Nova’s business operations for its illegal business practices such as illegal contract cancellation procedures.
http://mdn.mainichi-msn.co.jp/national/news/20070628p2a00m0na010000c.html
Nova Corp. in Osaka, the nation’s largest English school chain, won a public tender for an Osaka Municipal Board of Education program to dispatch assistant language teachers to municipal middle schools in spring 2006 with a price matching the closed ceiling price of 54,850,200 yen, The Yomiuri Shimbun has learned.
A board official said the matching prices were purely coincidental. The board, however, plans to investigate whether information about the tender had been leaked, since the bids matched within a margin of only 100 yen.
The firm also won other public tenders for a similar program for primary schools with bids of 95 to 98 percent of the ceiling prices.
According to the board, three firms, including Nova, participated in public bidding to supply ALTs to 116 middle schools and other schools on March 17, 2006. However, the tender was unsuccessful as all three firms placed bids higher than the target price. The board conducted the second public tender, with a higher target price, the following month. Two firms, including Nova, which had participated in the first tender, and another firm placed bids, with Nova’s matching the ceiling price.
Public tenders for a similar program at 299 municipal primary schools were held by dividing the schools into three groups based on their location on March 17, 2006. Nova’s bid for one group–6.55 million yen, and 98 percent of the ceiling price–was successful, but there were no winning bids for the other two groups.
Nova won one of two tenders held on April 25 the same year, with a bid of 4.59 million yen, 95 percent of the ceiling price, while another firm won a tender for another group with a bid that was 83 percent of the ceiling price.
The board official told a Yomiuri Shimbun reporter that contracts for the programs had to be made quickly because the new term had already begun, but denied the possibility of the leak.
The official also insisted the results of the tenders were coincidental, saying: “If the information of the closed planned price had leaked, would Nova have matched the contract price [down to the hundreds of yen] as doing so was sure to raise questions?”
Yesterday was, without a doubt, a media triumph for Nambu, and our struggle for job security for members.
We’ve been trying for so long for this kind of media exposure, and the current Nova news frenzy gave us our opportuniy to make the public aware not only of the working conditions in Nova, but also in the whole of the eikaiwa industry, and in the job market in Japan.
At the news conference yesterday at the Ministry of Health, Labour and Welfare, TV crews from 8 different broadcasters attended, along with numerous journalists. We spoke about the current Nova dispute and about the common problems of foreign workers in Japan.
To Nova, in its current crises, we publically announced the offer of an olive branch, a special peace proposal, to help with the situation: a cessation for now of strike action, in exchange for guaranteed renewal of contracts when requested by teachers.
Following the press conference, a Nambu Nova branch delegation, with the President, the Vice-president, General Secretary, and the Kubikiri-usagi Nova Bunny, tailed by a Fuji TV crew, went to Nova’s Tokyo HQ in Shinjuku. The intention was to deliver the union’s special peace proposal for the dispute to tpge company’s Tokyo head office.
The TV crew were blocked at the door! Nova management refused to come out and talk. No surprises, huh?
However, the company’s behaviour was worse than that: after the union delegation agreed to meet Nova management without the media present, the manager in charge, Robert Vaughan hid and told his staff to say he’d gone home, even though three members of the delegation had seen him in the corridor.
Robert, don’t be afraid. We’re not carrying guns.
The delegation, having drunk tea, but insulted by Vaughan’s declining to come to meet them to accept their proposal, had no alternative than to go tell the waiting TV crew what had happened.