Nearly a thousand British language teachers were left fearing for their jobs today after Nova, the scandal-ridden owner of Japan’s biggest chain of language schools, closed its doors and filed for court protection from creditors who are owed at least ¥43.9bn (£187m).
The firm, which has about 900 schools and 418,000 students, built its success on the back of aggressive advertising campaigns promising opportunities for “international exchange” at schools located near railway stations staffed by native-speaker instructors.
But its troubles began earlier this year when Japan’s supreme court ruled that it had acted illegally by refusing to refund students who had cancelled their contracts.
In June the trade and economy ministry ordered Nova to close some of its schools after deciding that its advertising campaigns had misled students.
The resulting negative publicity led to a dramatic decline in student enrolment and left the school unable to pay thousands of its instructors , some of whom face eviction because Nova has also failed to pay their rent, which is automatically deducted from their salaries.
Nova’s 2,000 Japanese staff have not been paid since July and about 4,000 foreign instructors have not been paid since September, according to union officials.
Christopher Gunn, one of an estimated 900 British teachers at Nova, has been forced to borrow from friends to pay the ¥55,000 monthly rent on his apartment and says he has only ¥3,000 left in his bank account.
“Until this morning no one knew what was happening,” he told NHK television. “I’m angry and a little upset but not surprised at all. I may have to borrow money for a plane ticket home.”
The Osaka district court will attempt to find new sponsors to rebuild Nova’s business. Trading in Nova shares was suspended on the Jasdaq securities exchange in Tokyo, with the shares to be delisted late next month.
The General Union, which represents many Nova employees, said the school’s troubles had reached crisis point. “This is a serious development that could force many students, instructors and employees to suffer losses,” the union’s chairman, Katsuji Yamahara, told Kyodo news agency.
The British embassy in Tokyo has received dozens of calls from worried teachers and has set up an advice page on its website.
“We are doing everything we can in terms of consular support and advice but the one thing we can’t do is provide direct financial assistance,” an embassy spokesman told Guardian Unlimited.
The embassy is putting British teachers in touch with a travel agency that has agreed to provide cheap flights to the UK.
Nova enjoyed huge popularity during the 1980s and 1990s, when it tapped into growing interest among mainly young Japanese in learning conversational English, French and other languages.
But on Friday morning all of its schools were closed and calls from anxious students and teachers went unanswered.
Its president, Nozomi Sahashi, was fired at an emergency board meeting last night for his “opaque way of fund-raising and negotiating with potential business partners,” the company said. Mr Sahashi has not been seen for several days and has failed to respond to repeated requests to meet trade ministry officials.
Nobutaka Machimura, Japan’s top government spokesman, told reporters: “This matter affects not only the students but foreign teachers and staff. I hope that the impact can be minimised.”