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A: THE CONFLICT BETWEEN INTERAC AND NOVA LED TO NOVA’S FAILURE TO SUPPLY ALTS TO THE SAPPORO BOARD OF EDUCATION

The Sapporo Board of Education has directly employed 35 ALTs (Assistant Language Teachers), following the law, but outsourced 65 ALTs in the form of “subcontract” without no clear reason.

The School Education Act states that the Board of Educations and schools should have instructions and teacher’s license.

However, against the notification issued by the Ministry of Education, Culture, Sports, Science and Technology (MEXT) on August 28th, 2009, stating that “ALTs should be directly employed [by Board of Educations]” and that “subcontracting is illegal”, the Sapporo Board of Education have repeated the subcontract – a clear violation of the Act for Securing the Proper Operation of Worker Dispatching Undertakings and Protection of Dispatched Workers.

In March, 2016, Interac North Co., Ltd. bid on the Sapporo contract with a tender higher than the Sapporo Board of Education were willing to accept, and subsequently had their bid rejected. Consequently, the tender of NOVA Holdings Co. Ltd. was accepted instead.

During this time, the “donations-for-favors” scandal between the office of Olympic’s Minister Toshiaki Endo and Interac Co. Ltd for attempting to reinterpret the dispatch law in an attempt to legalize subcontract was still brewing, and the issue was taken up in the House of Representatives.

There is a suspicion that the Sapporo Board of Education’s decision to not award the Sapporo contract to Interac in 2016 was fallout from the Interac / Endo scandal, but Interac continue to deny this is the case.

NOVA, the winner in this race to the bottom, is (compared to Interac) new to the ALT business, and experienced extreme difficulties in preparing a sufficient number of ALTs to fulfil their contract obligations.

As it was not enough to only transfer teachers from their schools in the Hokkaido area, NOVA also had teachers in the Kanto, Tokai and Kansai areas move to Sapporo in a desperate attempt to fill the quota. However, even with this frantic relocation effort to pad out the numbers, it was still not enough.

At the same time, many teachers who had worked for Interac in Sapporo until March, 2016, applied for their old jobs with NOVA in hope of continuing to work at the same schools and keep the same assignments that they had held while working for Interac.

NOVA accepted these applications and made the employment contracts to work under Sapporo Board of Education with them.

NOVA reported to the Sapporo Board of Education that it was ready to meet its contractual obligations, and, on April 18th, the Board of Education had the explanation meeting with schools in the city with the attendance of NOVA teachers, and NOVA’s Sapporo foray into the ALT business started as planned.

In an answer letter to the General Union, NOVA told us: “Just before the beginning of lessons on May 2nd, we simultaneously received emails from 13 teachers who had come to us from Interac, and who we had employed. These e-mails told us of their cancellation of their contract with NOVA. Again, we must stress that these e-mails were received simultaneously and used the same wording. We will consider legal action against THE COMPANY.”

NOVA believes that they could not fulfil the conditions of the bid because Interac set about to poach NOVA teachers back into Interac’s employment, thereby sabotaging NOVA’s business operations in Sapporo for its own gain. As a result of this, NOVA is considering legal action against Interac.

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B: INFLEXIBLE “CANCELLATION” BY THE SAPPORO BOARD OF EDUCATION RESULTED IN 274 SCHOOLS NOT HAVING LESSONS AND TOOK AWAY JOBS FROM MORE THAN 100 ALTS

In the wake of NOVA suddenly and unexpectedly losing thirteen ALTs, NOVA asked the Sapporo Board of Education to grant them a grace period extending to the middle of May to find replacements for the thirteen ALTs who had quit.

In addition, NOVA pleaded with the Board of Education to allow the NOVA ALTs who were still employed with the company to begin lessons as planned and continue with their employment as normal while the company worked to fill the thirteen vacancies.

However, NOVA’s pleas were rejected, and the contract between NOVA and the Sapporo Board of Education was cancelled BY the Board of Education on April 28th, four days before the beginning of English lessons.

A similar case of a company having the required number of ALTs, only to unexpectedly lose some of them, had happened at the Osaka Prefectural Board of Education, prior to the Sapporo incident.

In this case, the Osaka Prefectural Board of Education had told the ECC Foreign Language Institute (ECC) that “[a]ll teachers from ECC should start to work immediately. ECC should fill the vacancy as soon as possible.”

Lessons were not cancelled and, unlike the Sapporo Board of Education, the Osaka Board of Education was content to permit unforeseen circumstances and allow ECC to fill the sudden vacancies instead of throwing out the entire contract.

The General Union presented such a solution to the Sapporo Board of Education and proposed that the Board of Education should urgently employ teachers directly and not, instead, repeat the bidding failure. In this way, the Board of Education could avoid the lesson cancellations and ALT deficit that it was heading towards by essentially punishing ALL of the ALTs over a relatively small vacancy.”

However, all of the General Union’s suggestions were ignored by Board of Education.

In the end, English lesson in 274 schools were cancelled from May 2nd, and a lot of teachers who had worked for both Interac and NOVA have not been unable to attain a stable life or certainly for the future until now.

It is an unprecedented situation, and the decision by the Board of Education to burn the (proverbial) house down instead of just repairing a broken window was a fatal mistake.

They persisted in putting their ALT requirements up to bidding to leave things up to a private company, ignoring the interest of students, parents, and teachers.

During collective bargaining on May 30th, the General Union asked the Sapporo Board of Education who had made the decision to cancel the entire contract instead of allowing NOVA an extra month to find a handful of additional ALTs. The Board of Education told us: “The decision was made under the approval of the Mayor and the Superintendent of Education.”

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C: SAPPORO CITY PUNISHED NOVA WITH A FINE OF 24 MILLION YEN FOR NOT BEING ABLE TO MEET THEIR CONTRACTUAL OBLIGATIONS

In the midst of the confusion, the Sapporo Board of Education called NOVA and urged them via writing “to pay a fine of 10% of the amount of the contract for the non fulfillment of conditions over the bid.”

NOVA, therefore, had no option but to pay about 24 million yen after just half a month of operating its ALT venture in Sapporo.

It might follow the regulation of the bid and constitute a part of “miscellaneous revenues” of the city, but it is not only Interac and NOVA who are responsible for the mess. The Sapporo Board of Education’s absurd decision to cancel the entire contract instead of waiting a month more (and, indeed, their decision to tender the contract to private companies to begin with) makes them just as responsible (if not more-so) than the other parties involved in the catastrophe.

This money should be used for students who missed out on valuable lessons, and for the teachers who had belonged to both companies and whose lives seriously suffered from being caught up in company politics and bureaucractic failures.

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D: IGNORING APPEALS FOR AN IMMEDIATE START OF LESSONS BY URGENT DIRECT EMPLOYMENT, THE BOARD OF EDUCATION INSTEAD RUSHED TO BIZARRE “RE-BIDDING”

In spite of all of the failures, upset, and chaos that had been caused by this debacle, the Sapporo Board of Education ultimately stated that it would not direct-hire any ALTs, and made a public notification that the contract(s) would be open for bidding on May 11th.

Whether or not Interac poached teachers of NOVA in order to sabotage NOVA’s business operation in what was previously Interac territory will be something for the others to decide should the two companies fight the issue in court.

However, it cannot be denied there is something strange about the circumstances surrounding this disaster.

Far before the notification of re-bidding were announced by the Sapporo Board of Education, around the end of April to the beginning of May, Interac North Japan suddenly contacted former Interac and NOVA teachers and essentially told them, “We will be contracting with the Sapporo Board of Education again, so please come and work for us.”

We received reports from some of these teachers that they visited Board of Education to confirm what Interac had said, and that Board of Education answered that what Interac had told them was the truth.

(We are now further investigating the contents of the communication(s) recieved before the re-bidding.)

In the midst of the confusion that the lesson cancellation(s) caused by themselves, the Sapporo Board of Education refused direct employment and conducted re-bidding, having learning nothing about the risks of outsourcing ALT services to private companies of questionable integrity.

In addition, IF the Sapporo Board of Education HAD, as accused, told a private company that they would be awarded the contract BEFORE the legal steps such as notification, bidding, and examination, had been conducted, it was an unfair bid – a serious violation of law.

At the hearing by the General Union, the Board of Education said: “The period of bid is usually 40 days; but it was 10 days, this time, because of this emergency. Of course, fair examination is required because it is a bid of a general evaluation type. However, the examination was done in two hours and the winner was chosen on the day that the bid opened because of the emergency.”

Suffice to say, this bidding process was as suspicious as it was abnormal, and it is certainly a possibility that some laws may have been broken to rush Interac in through the door.

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E: NOVA INTENDS TO RE-EMPLOY TEACHERS AT THEIR SCHOOLS, BUT THE OFFER OF COMPENSATION IS INSUFFICIENT. IN ADDITION, THEY ARE EXCLUDING ASIAN TEACHERS VIA DISCRIMINATING REGULATIONS

NOVA told the General Union that they would pay 50,000 yen of contract deposit and salary for three actual working days (until May 9th, the day of contract cancellation), and that teachers would not be transferred but instead dismissed and then re-employed.

Even in an emergency situation, it is unacceptable to give salary for only three days to teachers who were forced to move twice, and then to dismiss them without a dismissal allowance. They have to be completely compensated until when they get new jobs.

In addition, teachers from the Philippines lost ALT jobs under the Sapporo Board of Education’s mishaps and could not be accepted into NOVA’s schools in Sapporo because of NOVA’s discriminating “native speakers only” regulations.

One of mother tongues of the Philippines is English. Filipino teachers have a lot of experience with English education. It is unacceptable discrimination that they are dismissed only because they are Asian.

The General Union is now recommending that NOVA abolish such racial and national discrimination regulations because they are clearly human rights abuses.

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F: ALTHOUGH THEY HAVE THE SAME SPECIFICATIONS AND WORKING HOURS, NOVA ENROLS ALTS IN SOCIAL HEALTH INSURANCE WHILE INTERAC DOES NOT

Following the timetable of school, the Sapporo Board of Education may violate the Labor Standards Act by offering no overtime pay in addition to not enroling ALTs in social health insurance (shakai hoken).

It is said that teachers who had moved to NOVA were given an explanation by Interac that they could “get 20,000 yen more than NOVA if they came back to Interac.”

Reading between the lines, what Interac were saying is that – because Interac illegally fails to enrol its foreign employees into the social health insurance program – teachers could “save” 20,000 yen per month by having to pay into the kokumin kenko hoken (National Health Insurance) system instead of being enrolled in the shakai hoken program. Indeed, they could save 20,000 yen per month, PROVIDING that they didn’t pay into the national pension system.

Even though any company with more than five employees has a legal obligation to enrol those employees in the shakai hoken system, it recently became an additional legal obligation for a company with more than 501 employees to enrol them in the social insurance regardless of the conditions of their contract.

It is therefore quite abnormal that NOVA provides shakai hoken enrolment but Interac does not, despite the fact that specifications, job description(s), and working hours for the bid were the same between the two companies.

On this point, NOVA was legal and Interac illegal.

The Sapporo Board of Education’s specification states that ALTs work from 8:30am to 4:15pm; according to the explanation by Board of Education in the collective bargaining with General Union, 45 minutes of “break time” is also regarded as working hours under the guise of as “school lunch instruction.”

In the lawsuit by an ALT belonging to Interac, the Tokyo District Court identified that “working hours are actually 35-40 hours, even if they are 29.5 in the contract” and that “all the time between lessons is not a break but working hours spent for preparation of material, cleaning up, and moving to the different classrooms.” This ruling became the final judgement.

Then, the National Pension Service ordered Interac to enrol the plaintiff in the social insurance. The working hours of 7 hours and 45 minutes at Sapporo Board of Education is a clearly full-time job – therefore, there is an obligation to enrol ALTs in the social insurance and to pay for overtime work.

Even though they are a large national company who understands the law fully, Interac continues to write “29.5 working hours a week” in their contracts and refuses to enrol foreign employees in the social insurance system.

However, such “double working hours” are being permitted, and the timetable based upon more than 29.5 hours a week leads to Board of Education’s violation of the Labor Standards Act in no overtime pay.

Subcontracting of ALT is illegal dispatch and violation of the School Education Act, the Dispatch Law, and the Employment Security Act.

Interac have been punished by Labor Bureaus all over the country for its violation of the Dispatch Law and the Employment Security Act. In this case, there is a strong possibility that Sapporo Board of Education will be indicted for the violation of labor laws as the contractor and the dispatch destination, too.

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G: LESSONS LEARNED FROM THE EXPERIENCE IN SAPPORO: BIDDING FOR SUBCONTRACT OR DISPATCH IS IRRESPONSIBLE AND DOOMED TO FAIL; IMMEDIATE AND SUSTAINABLE DIRECT EMPLOYMENT IS THE SOLUTION

Ever since May, newspapers (including the Hokkaido Shimbun and the Japan Times) and TV stations (including HTV) have been reporting on this issue.

The majority of these reports includes phrases such as “[a]nger of parents against the cancellation of lesson” and “[t]eachers tossed about and turned adrift”.

The common opinion among them is sensible – direct employment is the solution to all of these problems.

It is true that one of the aspects of the confusion in Sapporo is the competition in the ALT business – aka, the infamous “race to the bottom” in which dispatch companies win big and everyone else loses.

However, you might be surprised to know this little dirty secret that dispatch companies don’t want anyone to know: When the tender of any company is accepted, the company actually has NO teachers to send.

Dispatch companies bid on contracts with the promise that they have a pool of foreign teachers just sitting around waiting to be assigned to schools and Boards of Educations. However, the reality is that dispatch companies don’t actually have these people – they just sell Boards of Education on the promise that these teachers exist, and then frantically scramble to meet the quota once a contract has been awarded. It’s all smoke and mirrors.

This was clearly demonstrated in Sapporo: once Interac left (and took its ball home with it), NOVA told the Board of Education that it absolutely had sixty-five ALTs just waiting to take over the void that Interac had left in its wake. When the contract was then awarded TO NOVA, a desperate struggle began to actually provide the goods that had been promised (in this case: ALTs), going as far as to shuttle ALTs in from other parts of Japan to meet the numbers in the hope that the Sapporo Board of Education wouldn’t look TOO closely at what was going on.

When the Sapporo Board of Education cancelled the contract with NOVA, Interac evidently came back and promised that the well of ALTs that had now been truly and utterly tapped was, in fact, actually filled to the brim.

The likelihood now is that Interac will flood Sapporo with a host of inexperienced teachers, new to Japan, and that Sapporo will have lost a good number of the experienced people who had been living and working in Hokkaido for many years.

Relationships with teachers and students, years in the making, have been almost completely destroyed; teaching methods and styles have been lost to time and memory. The damage of this debacle runs deeper than it appears on the surface.

Case in point: both companies recruited urgently until just before the planned date that work was due to begin.

How can proper screening, visa preparation, or training, be handled in such a short time?

Such risk and failure of the bid is inevitable for a subcontract or even dispatch under the Dispatch Law.

Furthermore, it is quite difficult even for the big company to secure many ALTs like for Sapporo under the current system, for the reasons mentioned above.

If we consider the quality improvement of education by ALTs, and the accumulation of experience and stable continuation of lessons, nothing is better than direct employment by a Board of Education.

We urge the Board of Educations that are still continuing illegal subcontract or dispatch of ALT to learn a lesson from the failure of the entire process in Sapporo.

Equally, the Sapporo Board of Education should learn from local governments directly employing ALTs, and employ and train ALTs by itself in order to accumulate the experience and self-sufficiency required of good language education.

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