# Contract Problems and My Employer Lied About Paying My Taxes, help?



## edenrising

I work for a relatively new eikaiwa in Osaka, the owners of which are the ex-owners of GEOS, that big eikaiwa that went bankrupt in 2010 (which I didn't learn until after I was hired).

I have several problems that I need help with, but don't know where to go now that GaijinPot Forums are closed. So if anyone has any advice it will be warmly welcomed.

My first problem.
I signed a 2 year contract, which is filled with barely competent English, but at the start of my 3rd year, they never asked me to sign a new one. Written into my 2 year contract, from Feb. 2012-Feb 2014, word for word is

-The employee shall either proved the employer with written notice of termination (the "Notice of Termination) or a written request for an extension of the agreement (the "Extension Request") for an additional period of 2 years to commence after the expiration of the "Initial Term" (the "Second Term") at least four (4) months prior to the expiration of the Initial Term.

"Second Term" is never mentioned or explained anywhere in the contract.
"Initial Term" is only mentioned in earlier parts of the contract as the 3 month probationary period, which doesn't make sense, so I'm assuming is means the contract as a whole.

Since I've never signed anything despite going into my 3rd year, that means I am technically not under contract, correct? Which means I don't need to give 4 whole freaking months notice before quitting, correct? I want to get out of this school as quickly as possible, without the threat of any legal or financial problems.


My second problem and third problem are combined.

When I first started working here, I asked about paying taxes in Japan and for a slip of paper or something like a W-2 showing my income and such for the first year so as to file my taxes back in the US. I was told not to worry about my Japanese taxes, but I was also never given any papers and they seemed to have no clue what I was asking about when talking about income papers.

I did a little research on my own, and realized they were probably doing income withholding for taxes purposes, which, based on my research, means I didn't need to file anything with a tax office; they were doing it for me. 

My base pay was 250000 yen each month, and I was also supposed to be getting paid 500 for each new student that signed up for my class and 300 yen for each student that renewed each month. I got my pay of 250000, but never the extra money, so I assumed (stupidly) that that was what was going towards my taxes.

Then this week, after I had been working here for almost 3 years, my boss came and told me that either 

a)he hadn't been paying my taxes 
or 
b) he had been paying from company funds and _not_ withholding any money from my paycheck

I couldn't properly understand which. He then said that now I would need to pay a years worth of taxes out of this months paycheck. Well, my husband is currently on sick leave, and we're living off of _my_ paycheck, so pulling almost $700 would be impossible. I told him not to bother and to pay me in full, and that I would go to the tax office myself. 

When I asked him about the extra money, which I thought was going to my taxes, he said that since the school has been in the red for so long, they are unable to honor the contract and wont be paying me the extra money. Technically if I'm not under contract right now there is nothing I can do, but for the two years I _was_ under contract, I'd like my money...

And if he hasn't been paying my taxes for me, then that means I haven't payed Japanese taxes in over three years. I couldn't really understand whether he has been or not because he was trying his hardest not to claim any guilt while still explaining I would need to pay up. I'm hoping to go to the tax office on Monday with my Japanese husband to figure out what I need to do, but any advice from anyone else would be greatly appreciated.



The extra money clause is as follows:

(1) BASE SALARY
A base salary if 250,000 yen per month
During the probationary period (Initial term) A base salary is 200,000 yen per month.
(2) EXTRA PAYMENT
An extra payment, earned during the prior month, starting from the first date till the last date, base on calculation as JPY500 per fresh student and JPY 300 per renewal student every month, will be paid on the date of paying date of the posterior monthly salary.


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## larabell

You really need an attorney, not a discussion forum because what you're describing sounds like a very poorly run company that probably isn't going to help you much unless you twist their arm.

I am not an attorney (and I don't play one on TV, either) but unless there's a clause in your contract somewhere that provides for automatic renewal, I would tend to agree that you're no longer under contract. I don't know much about how English schools work but it doesn't sound unusual that they'd just keep you on month-by-month if you didn't request a new contract. Does it say anywhere that the Japanese version of the contract takes priority over the English translation? That's not unusual either -- in fact, most of the forms I've ever signed in English while in Japan have that sort of wording. If that's the case, you might want to obtain a copy of the Japanese version to see what that says.

It also sounds like you're going to have to sue them for the extra money. Whether that is a good idea or not depends on how much you figure they owe you.

You might be able to find out from the tax office whether the school is on the hook to withhold taxes. If you're a contract employee, they probably aren't. And it sounds like you weren't having anything deducted at all (since they already admitted to not paying the extra money). It's kinda odd that you would have worked for two years and not even questioned why you weren't getting a monthly pay slip of some sort. If they were withholding taxes, I'm sure they're obligated to tell you how much every time you paid. You should also have gotten a form at the end of each year with the total they paid you and the total they withheld. It's possible the school could get in some degree of trouble with the tax officials if they haven't been keeping good records and providing pay slips to their employees.

Also, the math doesn't seem to add up. Given how much you were making, a whole year's taxes should come to a lot more than $700. If you really haven't been paying for three years, that should be a matter between you and the tax office. They should have contacted you directly. I doubt they'd just tell the employer to withhold a year's worth of taxes without some kind of judgement. It's possible your employer is screwing with you.

Go to your local city/ward office and find out if they have legal consultation in English and talk to someone who can help you sort this out. I know my ward office has a free service where you can consult someone in English on legal matters -- I think it's like once a week on specific days.

Good luck.


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## xhristophe

In addition to that I would suggest getting in touch with a union. They are a bit toothless in some respects, but something like that could offer you English language support, additional ideas for representation and they might already have representatives within your company. Only problem is the Eikaiwa industry is very allergic to union members, so don't go broadcasting it too loud.


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## Stevesolar

Hi,
It sounds like the company is on its knees and the tax is simply an excuse to pay you less this month - but unlikey that they will be passing the witheld money to the tax office.
I fear that they have been handling your tax affairs badly and if you bring that to the attention of the tax office - you will both get in trouble.
The company will probably fold or be shutdown and prosecuted and you will also find yourself having to pay any outstanding taxes. The end result, of course, would then mean that you would be out of a job whilst still owing a considerable sum to the tax authorities - not a good place to be.
Best of luck
Steve


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## edenrising

Thank-you all so much for your advice. I realize a forum probably isn't the best place, but I didn't know where else to go so thank-you for the legal consultation advice. 

I _was_ a bit of an idiot for not asking for payslips and such. I just got paid in cash every month and thought that was normal. At the end of my first year, for about 2 weeks I went in circles trying to get him to give me something like an American W-2 form, that showed my pay and taxes. He gave me a bunch of random papers and then proceeded to ignore me when I mentioned they weren't what I was looking for, so I eventually gave up.

I am planning to contact the Labor Bureau in Osaka and see what they can do to help me, and then going to a tax office. I'm fine with eventually paying my taxes, because I _do_ owe them. My boss ended up paying me in full after I told him I would pay the taxes myself. 

Can anyone recommend a good Japanese tax calculator that will let me know how much I'll end up having to pay? I googled it and tried 3 different calculators, and got 3 different answers; 7man, 15man and 21man... I'm hoping it's more along the lines of 7man...

As for getting a new job, I'm applying for several right now. I'm just mostly worried that I'm going to have to pay 'damage penalties' for only giving 2 months notice, when my contract required 4-6 months notice. However since I'm not technically under contract, I don't think there is much they can do to me. But there isn't much I can do to them either. And unfortunately, there is no Japanese version of the contract. I could probably understand one written in Japanese more than this poorly written English one.

I'd also like to mention the fact that I am the only teacher at this school. It was only started about 3 years ago and I was hired as the first teacher. It's just mainly just me and my boss. His father is the founder of the old Eikaiwa company GEOS, and comes in every once in a while, but the man is old and somewhat psychotic... We also have one other part time teacher, but he's planning to quit soon as they have no plans to make him full-time, and he knows they are screwing me over. So I would say, yes, this school is slowly dying because of terrible money management.


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## larabell

Stevesolar makes a good point about the potential for losing your job should the company fold. I might add, though, that unless you're planning on leaving the country soon, the tax guys will eventually catch up with you and, besides the tax, you could end up with penalties. But whomever handles your case has the discretion to waive the penalties if they buy your excuse (I know because I had that happen to me once when I screwed something up by mistake). Waiting might make that harder to pull off. It's not clear to me which would be better but I'd probably talk to the tax office sooner rather than later.

I used to know of a website that clearly spelled out the calculations in English but I don't think it's around any more. But it's not hard. You can pick up an English version of the tax form instructions at the tax office (or online) and walk through the calculations yourself. Unless you have special costs you can deduct, it's basically your gross salary times a fudge factor, minus personal deductions for you and any dependents, minus whatever you paid for Social Insurance, and look up the remainder in a tax table. You can even bring everything into the tax office and have someone there do it for you (although if you want to do that, do it soon -- the lines are pretty long in February and March).

And if your current contract specifies an end date or a fixed term and that term has expired, then I would imagine you could walk out today and there's not much they can do. Just make sure they're paying you on time for the work you're still doing... none of this "after 30 days if you're lucky". Because it really sounds like they've hit the bottom of the barrel and you could end up being stiffed for your last paycheck if they actually do go under. I hear that happened to a lot of teachers back when the Geos/Nova debacle went down, though fortunately that's not something with which I have any personal experience.


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