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  • GEOS Bankruptcy and G-Education takeover: Internal document forwarded to Debito.org stating staff not getting back wages

    Posted by Dr. ARUDOU, Debito on April 28th, 2010

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    Hi Blog.  I’m sure you’ve heard about the next great pop in the Eikaiwa Bubble in Japan, the bankruptcy of GEOS this month.  Looks like there be a similar takeover and people left without jobs or remuneration for past work, so people in the industry, heads up.  I was forwarded this morning the following internal email from GEOS, and those in the know might be able to explain better here or elsewhere what this all means.  FYI.  Arudou Debito in Sapporo

    ////////////////////////////////////////////////

    Begin forwarded message:

    From: ジオス 法人営業部 加瀬 <junichiro_kase@geos-gci.jp>
    Date: April 27, 2010 2:32:25 PM GMT+09:00
    To: 法人営業部(中部) 加瀬 <junichiro_kase@geos-gci.jp>
    Subject: 【【Notice to all GCI corporate class teachers】】

    Dear all my hard working staff.

    With the absolutely regrettable news of the bankruptcy of Geos Corp, I must tell you that your salaries for the time period between 2010, March 16th to 2010. April 21st Will NOT be paid to you. There isn’t any cash left. We will work on a way for you all to collect some of your money back through the government. We are still unsure of the procedures to do this.

    G-Education has offered to take over the Geos Corporate sales Division and resume all corporate class operations from the May 6th 2010. However it will be under the new payroll system as follows:

    • All previously negotiated hourly/rates between the GCI and part-time teachers will remain in effect.
    • New Payment period will be as follows: For work done between 5/1 and 5/31+ transportation expenses  will be paid on 6/21. For work done between 6/1 and 6/30+ transportation expenses  will be paid on 7/20. etc.
    • Paydays will now be on the 20th of the month or previous business day should the 20th of the month fall on Nat. Holiday or weekend.

    At this point the GCI has been completely decimated. Our clients are outraged and my teachers left on stand by.  Myself and Terakawa-san have made a gentlemens agreement to try and salvage and rebuild our perfectly-functioning, profitable corporate class system. We are giving ourselves 3 months to do it, or we will eat our hats.

    What we need from all of my precious teachers is an agreement that you would like to continue your classes with Myself and Terakawa-san at the helm. Could you please respond to me by email  “Yes” or “No” If you respond “No” I hold no hard feelings against you and I would hope to work with you again in the future when other opportunities arise.  DEADLINE FOR RESPONSE WILL BE MAY 5TH 2010. And we hope to resume operations immediately after golden week.

    At your service

    Junichiro KASE
    G-Education (GEOS Corporate Classes Division)

    Junichiro_kase@geos-gci.jp

    ジオス 法人営業部/加瀬淳一郎

    連絡先; 080-3440-6397

    ————————————————-

    旧ジオス法人営業部の固定電話は不通になっております。

    新しい連絡先は別途お知らせいたしますので、

    恐れ入りますが今しばらくお待ち下さい。

    ————————————————-

    ENDS

    12 Responses to “GEOS Bankruptcy and G-Education takeover: Internal document forwarded to Debito.org stating staff not getting back wages”

    1. sendaiben Says:

      “Dear my lovely teachers, we are not going to pay you but hope you will be stupid enough to continue working for us anyway. Tootle-pip!”

      Cynical in the extreme. The way I see it, if you take over an organisation then you should also take on its responsibilities, not just the assets.

    2. Mr. Svengoolie Says:

      Ah yes! If they filed BK at the end of last year teachers and students could possibly have gone to Plan B. But by filing BK in late April,after hiring season, the only people who benefit a few at the top…maybe. A sad scam.

    3. Arin Says:

      Back in 2007 and 2008, I did a Homestay and studied Japanese for about 2 1/2 Months in Geos-Kudan, Tokyo, Suidobashi. The Prices were cheap compared to other schools and because of this, I think it is/ was popular amongs the students. The classes were always full of students. Well the classrooms sure needs some renovation. They were mostly separated by a thin wall made out of wood, so you can clearly hear other students chatting to each other, which was very unpleasent.

      I visited the website again after reading this and the logo ” GEOS ” is now nowhere to be found. If you click on the picture of students, you will be able to see the GEOS logo on the upper left side.

      I like the school so much because:
      1. Cheap in Prices
      2. All the teachers are very friendly
      3. Located in the middle of Tokyo

      It is really sad to hear this kind of news, but without Debito, I probably would have never knew this.

    4. Hoofin Says:

      FWIW, when NOVA went under a bit of information was popularized on the net that a government agency would pay 80% of the wages due.

      Here is maybe a bit of evidence of that. The Nova business posting also has a link to the agency (Japanese language), with more details. http://www.nova.ne.jp/information/to-staffs-0802-en.html

      I don’t know if this holds for GEOS. But anyone finding themselves in this predicament should obviously start by investigating this possible relief.

      Sendaiben, I’m not sure that’s how bankruptcy works in Japan. If it’s anything like common law countries, when the bankrupt company declares it, an “estate” is created and the government appoints as “owner”, a trustee. The trustee quite often then tries to sell or spin-off assets in order to satisfy the debtors. Usually “secured creditors” take whatever collateral supported their lending, unless there’s enough value in it that some is left over for the bankruptcy estate. But as the company is bankrupt, usually there aren’t enough assets left.

      When G-Comm says it’s taking over the operations, I assume that company means that they are agreeing to hold the classes that were offered and, naturally, employ the labor needed to hold the classes. And that’s it. Since G-Comm won’t be seeing any tuition money for the classes it offers, G-Comm already loses on the agreement to employ the teachers. The only asset GEOS might be picking up are deposits on rented premises. But even there, I suspect that those would default to the individual landlord as a secured creditor anyway.

      G.Comm’s business specialty is said, actually, to be food service and jukus. I think both are a kind of “this or nothing!” atmosphere for employees, and so competitive that the worker has little choice but to become very flexible.

      I think this is why the Japanese government invited G.Comm in during the Nova situation, and why they are now there with GEOS. G.Comm makes a bad situation that the Japanese government has long tolerated go away from the headlines, or at least make it look to outsiders that it’s just another restructuring that, tee hee, happens when you’ve got “the magic of the free market” working for you.

    5. The Shark Says:

      What are they talking about: “We are still unsure of the procedures to do this”?
      The procedure is very clear. The government will have to pay 80% of unpaid wages in this case (application for that within a certain time period is needed though).
      … That’s how it also was in the case of NOVA’s employees.

      And if it can be proven that GEOS knew before they were unable to pay wages but continued to let people work for them, then that matter could even be taken to court.

    6. Rachel Says:

      Oh dear. I can’t help but wonder what will happen to the many foreigners who now suddenly find themselves unpaid for over a month of hard work. Also, I find the tone of this e-mail a little inappropriate. “There is no money left, so you will not get paid. Deal with it.” Not even a “Please understand and bear with us while we sort out this mess” or anything. And I wonder how many people actually know the meaning of “eat our hats” without searching first…

    7. Level3 Says:

      Wow, so many internal contradictions.

      “Paydays will now be on the 20th of the month or previous business day should the 20th of the month fall on Nat. Holiday or weekend. ” was preceded by this:

      “For work done between 5/1 and 5/31+ transportation expenses will be paid on 6/21.”

      FYI 6/20 is on a Sunday….. >:(

      But most rich is the claim that their division is “perfectly-functioning, profitable” (and I suspect it was, knowing how much they charge corporate clients vs. what they pay teachers) BUT they can’t pay you the work you did for an entire month. If you’re tempted to sign on, how about a qualified “yes, once you pay me for my work in March-April as a sign of good faith, since your division has been profitable all along”

    8. Hoofin Says:

      Japan Times is now reporting that G.Comm says reopened 201 of the 300 something schools. http://search.japantimes.co.jp/cgi-bin/nn20100429a2.html

      From the article: “Sugimoto said he doesn’t know how many teachers his company will hire from the Geos schools that will be shut down. G.communication has already said it will keep all of the employees at Geos schools it is taking over.”

      Hopefully Shawn of Let’s Japan or maybe someone from one of the foreigner unions will keep tabs on how G.Comm goes with this, going forward.

    9. CF Says:

      Well I hate to sound sterotypical here but I experienced this while working at a J company. I wasnt paid for 3 months and some of the other staff went 6 months with no pay. It really opens your eyes up to how things are over here. They shacho kept going from bank to bank, trying to make payroll and paying for the rental of machines etc. Payroll was always the last thing on his mind. I saw the J staff go into gaman mode and hunker down, asking me if I had enough to eat and some pitiful feel sorry for me B.S. I stepped, let them do the gaman thing. Im not going on my rant about things here, dave probally wouldnt post it, but just watch your ass and know when to back out.

    10. September Says:

      Well I hate to sound sterotypical here but I experienced this while working at a J company. I wasnt paid for 3 months and some of the other staff went 6 months with no pay. It really opens your eyes up to how things are over here. They shacho kept going from bank to bank, trying to make payroll and paying for the rental of machines etc. Payroll was always the last thing on his mind. I saw the J staff go into gaman mode and hunker down, asking me if I had enough to eat and some pitiful feel sorry for me B.S. I stepped, let them do the gaman thing.

      A big difference between Japanese staff and most foreign workers here is that the Japanese often have mommy and daddy to fall back on. It is surprisingly common for workers in their 20s and 30s to be still living and eating at home for free with no bills to worry about. For many young Japanese workers, I’m sure that their biggest worry is nothing more than a 5,000 yen keitai bill each month. Of course, I’m totally envious of those living in grown-up child mode who don’t even have to worry about the basics and can still put away a huge wad of bills each month. Smart little sods the lot of them. ;-)

    11. CNevinT Says:

      I worked for an American-owned independent language school in rural Japan in the mid-90s, and at one point I was asked to work for no pay. I had been working for the company for several months on a working holiday visa (which meant I was essentially self-sponsored and could easily change jobs) and was paid on time. In fact there were two factions of teachers at the school – the A team and the B team. The A team were mostly trained teachers who had worked for the school for years, and had been recruited by the president from the States during the startup phase of the school. The A team were keeners, had drunk the Kool-Aid, and even attended the same church as the president.

      The B team were mostly teachers like me – they had come to Japan as JET spouses or on working holiday visas, and were just trying out teaching as an interesting job.

      The B team always got paid on time, but also were not trusted. The A team teachers were trusted, and often were not paid on time.

      When my working holiday visa ended, I was sponsored by the company. And, about one or two pay periods later I received a message from accounting saying my pay package would be a few days late.

      I made a fuss, and got paid on time. I also got a new car and a new and better apartment.

      I suppose I was in a strong position, and I did good work.

      But it sometimes pays to test the limits and stand up for yourself.

    12. CF Says:

      The place I worked was a bit strange, even for Japan. The shacho had quit, another J shacho took over or bought the operation (manufacturing) and had some grand dream of building F1 products, even though there wasnt any funding for it. The sheetmetal factory had allot of old folks working there who filled orders for other companies. This new shacho canned most of them, and added a design team etc. Its how I got on. There were few clients to buy the new products. Things went south fast, and payroll, building rental, machine rental etc were the first to get behind. just to keep things afloat he was able to secure loans from several banks, but they started to decline. It was interesting because people were calling everyday asking for payments, but this guy would run away. Payroll was the last thing on his mind with all these other creditors calling. Unfortuanetly, there are many cases like this. You have to ask yourself if the stituation seems to be to good to be true, like all sorts of promises during a startup or merger.

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