Japanese lesson: How Do You Say, 'Taken for a Ride'?

Sat Nov 3 15:43:57 UTC 2007

Japanese Lesson: How Do You Say, 'Taken for a Ride'?
By YUKARI IWATANI KANE and YUKA HAYASHI
November 2, 2007; Page A1

TOKYO -- Fresh out of college, Sam Gordon bought a one-way ticket to
Tokyo for a chance to explore Japan's exotic culture while teaching
English at the nation's largest language school. All it took to get
the job was one simple interview. The adventure, which began five
years ago, has abruptly come to an end. His employer, Nova Corp.,
hasn't paid him since September. The company closed its operations
last week and filed for court protection, following a government
crackdown on its business strategy. With $20 left in his bank account,
the 28-year-old Mr. Gordon says he is living on his credit card. "At
least I have a big fridge and still have some food in it," says Mr.
Gordon. He doesn't want to go home to Milford, Del., just yet, he
says, because he'd have to borrow money for the plane ticket.

Sam Gordon, an English teacher in Japan, hasn't been paid by Nova
since September, and would need to incur more debt to get back to his
home in the U.S. Mr. Gordon is one of more than 4,000 foreign-language
teachers working for Nova to be slammed by the biggest scandal in
Japan's foreign community in years. The company, renowned in Japan for
the hip-shaking pink bunny in its commercials, had been on a hiring
binge, setting up recruitment offices in the U.S. and the United
Kingdom and prowling college campuses offering jobs.

Nozomu Sahashi, the company's quirky founder, was fired last week as
president and has dropped from sight. Now, worrisome details are
trickling out: The 56-year-old executive had quietly moved profits
from publicly traded Nova to his private company, a court-appointed
administrator alleged at a news conference. The administrators, who
are scrambling to find a sponsor to help turn around Nova, showed
reporters his lavish office, which has a Jacuzzi, a tea room and a
secret bedroom.

Now, the Nova teachers are jobless and those who have lived from
paycheck to paycheck are stuck in Japan. Some have been threatened
with eviction from their apartments because Nova, which had provided
housing and deducted the rent from teachers' salaries, stopped paying
rent months ago. In the past week, 300 Nova teachers have swarmed the
usually orderly employment agency office in western Tokyo, called
Hello Work, seeking jobs.

One labor union is planning to arrange for teachers in distress to
give lessons in exchange for a Japanese bento-box meal. Alarmed that
so many of its citizens are affected, the Australian government has
struck a deal with Qantas Airways Ltd. to provide discounted one-way
air tickets to Sydney. "I'm not really looking for a new job because
the market is just flooded with teachers," says Matya Sheppard, a
23-year-old Canadian Nova teacher who is dipping into her savings to
pay for food and other expenses. "I have no one to talk to. I'm in
limbo," says Kristen Moon, a 23-year-old teacher from Philadelphia who
fears she will lose her Tokyo apartment. Ms. Moon, who came to Japan
in May for a "new experience" after graduating from college in New
Zealand, is getting along by giving private lessons to several Nova
students.

English-conversation schools are a big business in Japan. Millions of
Japanese dream of speaking English. But the six years of language
classes given in middle and high schools focus on grammar, not
conversation, so few children learn to speak English well. The
$3.5-billion-a-year foreign-language-education industry teems with
more than 1,100 companies catering to about two million students,
according to the Japan Association for the Promotion of Foreign
Language Education.

The Osaka-born Mr. Sahashi, who founded Nova in 1981, used a
particularly inviting pitch. He promised his clients native English
teachers at half the price or less charged by rival schools. He touted
lessons as cheap as a movie ticket, so students could drop by as
casually as if they were going to a bar. There was one catch: To get
the cheapest price -- about $13.50 for a 40-minute class -- students
had to pay in advance for 600 lessons.

Armed with a wildly popular marketing campaign featuring a cheeky pink
bunny mascot, Nova rapidly opened 900 schools, took on 400,000
students ranging from toddlers to businesspeople and dominated the
language-school industry. The bunny, which shook its hips and, in TV
commercials, came to the rescue of people who wanted to improve their
foreign-language skills, became a nationwide phenomenon. It soon even
appeared as a character in videogames. The school's convenient
locations and policy of letting students come in whenever they wanted
to were also a hit. Sales reached $500 million in the year ended March
31.

To gather enough teachers, Nova set up nine recruiting centers in
cities from Chicago to Sydney, according to the company's recruiting
Web site, now shut down, and posted ads on Internet job sites.
Salaries offered were modest -- between $2,000 and $2,600 a month --
but the hiring process was simple, consisting mainly of a grammar test
and short interview, teachers say. "We interview 100,000 foreigners
every year," wrote Mr. Sahashi in a Japanese magazine article this
year.

Once they landed in Japan, teachers say they got straight to work. "It
was trial by fire," says Jerry Johnston, a 24-year-old Floridian who
started teaching for Nova in July. Mr. Johnston, who was recruited at
a career fair at Florida State University, said an experienced
instructor watched him teach for a couple of days and corrected him
when he spent too much time on any one part of the lesson plan. Then
he was on his own.

Students, meanwhile, found it hard to book lessons because there
weren't enough teachers. And when students quit before attending all
their prepaid classes, the school recalculated the lessons at a higher
rate, thus reducing their refunds.

Thousands of Nova students complained to consumer-protection agencies.
In June, the government effectively banned the sale of Nova's key
product: hugely discounted prepaid tickets. Nova quickly ran out of
funds, and checks began to bounce in July. On Friday, the company
filed for reorganization proceedings, the equivalent of Chapter 11
bankruptcy proceedings.

That has left students like Mari Matsunami with a bunch of prepaid
tickets. "I hope a sponsor will come up and continue the operation so
I can use up all the tickets," says the 39-year-old accountant. Ms.
Matsunami, who has taken English lessons at Nova for 10 years, says
she believes her unused tickets are worth about $1,300.

Many Nova teachers, hoping to remain in Japan, are looking for other
jobs. It hasn't been easy, since most don't speak Japanese. But a
more-promising option may be emerging in a nearby country with its own
major hankering for English skills.  EF English First, a European
language school operating 100 schools in China, posted an open letter
on the Internet to Nova teachers last week offering to hire as many as
1,000 people, complete with free air fare to China and a hotel room
during a two-week orientation. "We're opening a school a week -- and
there's more demand than supply of teachers," says Molly Fitzpatrick,
the schools' director of teaching recruitment and development.

--Miho Inada and Naoto Okamura contributed to this article.

Write to Yukari Iwatani Kane at yukari.iwatani at wsj.com1 and Yuka
Hayashi at yuka.hayashi at wsj.com2

  URL for this article:
http://online.wsj.com/article/SB119394083023779349.html

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