Interac, JET and the social insurance (Part 3 in a kind of a series).

Still on the topic of the last couple days.

Yesterday, I was talking about Dispatch companies and how the Japan Education—and Labor!—ministries have a system of “cheap JETs” hovering around the JET Program. Because the Dispatch companies compete on price, the inevitable trend is that the Dispatch ALTs (assistant language teachers) are bid down in wages and benefits. Because Japan only haphazardly enforces its social insurance laws, even in instances where it agreed to coverage through an international treaty, the inevitable result is that the companies that don’t provide the insurances are the ones that win the dispatching contracts.

So the presence of JET sets a cap on what a person can achieve as a career as an English teacher in Japan. And since JET is set up as an “exchange program”, the “participants” aren’t really employees, and are expected to leave Japan at some point. So then the dispatch system underbids the JET, and creates the same kind of short-term work environment (at a supposed profit to the dispatch company), where the question of the benefit to the students is entirely left out.

One of my more dedicated commenters of the few I have, “Kei”, pointed something interesting out to me, incidentally, earlier today. In Osaka, the prefectural board had created something called the “NET”. I used NET to mean native English teacher, and lo and behold, I am not the only one to think up the acronym!

Well, the NETs are direct hires of the Osaka boards of education. But a businessman got the wise idea to create something called the “T-NET”. (Pronounced Tee-net, similar to the borough of Teaneck back in New Jersey.)

I just did a cursory internet search on T-NET, and what I discovered is that the “T” stands for temporary, and it’s an ALT Dispatch job!

How creative! It’s the same pattern as what you see with the JET and the companies like Interac. JET sets a standard and then something is set up to compete with JET. Osaka set up NET, and then someone came up with T-NET, which is a dispatch service provided by Eikaiwa chain ECC.

ECC is known to pay social insurance for their workers actually, so the wonder is why another dispatch company hasn’t come in and underbid their “T”-NET offering.

In fairness to the dispatch companies, this is tax and economic theory at work. If the government lets companies get away with not paying social insurance premiums—remember, this can be 20% of total compensation—and then puts in a bidding system for the work, the companies that avoid the cost are going to win the contract.

Does “Japan” know that it’s doing that? You bet. It’s like Pearl Harbor. The actual thing that Japan wanted to do was carried out in the shadows. The Japanese declaration of war was sent through different channels, and arrived in Washington sometime after the attack.

So here, the Japanese are clearly violating the totalization treaties BUT it’s done through a Rube Goldberg machine to make it look like the treaty violation is really just a byproduct of some other set of events that “Japan” had no control over. Just like, “oops, we were planning this attack on your main Pacific naval base for months, but somebody forgot to tell the ambassador in Washington to deliver the declaration of war until after the hostilities began. Just an oversight!”

Ultimately, the Japanese bureaucracy achieves:

a supply of foreigner “teaching staff” who come and go, and are paid the lowest amount possible;

at a cost of:

paying some head-hunting firm a finder’s fee plus an administrative fee, again competitively bid, so the lowest amount possible.

The parents depending on the Japanese education system to teach their children English are made to feel exposure to this foreigner pulled off the street is somehow going to work magic, when English—like everything else you learn—requires effort, dedication and some patience.

Simply because the JET Program shelters a certain part of this greater scam from its worst excesses doesn’t mean the JET Program is so great. In fact, as I originally said, I think it’s a boondoggle. It sets up the chess board for all the cutthroat action that happens later. And more than a few of the people that are recruited into it develop these unpleasant attitudes. (In part, because they are exchange-ees before they are teachers.)

This is why, if “Japan” wanted an English teaching system in this country, they would scrap the JET for a “Teach for Japan” program, where they would directly hire competent English teachers in a career role. Just like how chemistry and dozens of other subjects are taught here. It would mean the revolving door goes away, but would eliminate the Rube Goldberg scheming that is only going to come back and bite Japan in the ass in the future, anyway.

6 thoughts on “Interac, JET and the social insurance (Part 3 in a kind of a series).

  1. Here’s a question off topic but I hope you can answer:

    I live in Japan and would like to increase my US social security benefits since I won’t have much when I reach 65. I understand you can combine earnings in Japan with those in the US but I was unaware of this. When I contacted the Japanese pension office I was told I can only back-pay up to 2-years which won’t help me.
    I plan to stay in Japan for eight more years and was told by my U.S. co-workers that each year I should declare the income I receive from private students ($10,000), pay fed tax on this amount and my benefits will begin to rise.

    Is this correct?

    1. Hi Karen. Of course, I can’t give you personal tax advice over the internet. But I can say this much:

      1) It isn’t a matter of “choosing” to declare income, if you are an American. So [you] are required to declare income to Uncle Sam if it is over some small base amount. (I think that base is about $9,100 for a single person.) Any foreign earned income is part of that base, so if you were earning $10,000 a year here, you should have been filing on it.

      I think what your friends mean is that if you pay Self-Employment Tax (15.3%), you build social security credit. So you would pay 15.3% on $10,000, or $1,530, and you would ordinarily be entitled to more social security benefits if you have paid in for 40 quarters (usually 10 years).

      2) The social security totalization treaty clearly says that a self-employed person residing in Japan should pay Japan. However, it’s unclear what happens in the situation where you are not paying Japan, and Japan is not demanding the money. Can you pay Uncle Sam? My honest answer is: I don’t know. Certainly Treasury will collect the money. And in fact, if you haven’t paid Japan social insurance fees on self-employment income, Treasury may feel that you are required to pay Uncle Sammy. It’s just not that clear to me.

      This is what happens in a screwed-up administrative system, which is what Japan has. No offense, but it might be inappropriate for the rest of America to be subsidizing your social security benefit, when you have a choice of rules–especially if you are in something referred to as the “90% bracket”, which is the part of social security where you receive a larger payment boost for every $1 paid in. (Usually, this is to about $660 of the social security check.)
      I think a number of Americans here are playing that game, and the Japanese are complicit in it. That is to say, they wait until later years to pay into social security, and since the Japanese haven’t enforced their system, the American system is all that the American expat has to rely on.

      Good luck with whatever you decide.

      1. * – The technicality is that if you were self-employed in America, and transferred your business to Japan for 5 years or less, you can still be in social security. But ordinarily, if you are a resident here and work self-employed, you are supposed to pay into the nenkin system.

  2. Hmmm.

    I also think the government should formalize volunteer programs for people who are already here. There are a lot of native speakers who would be happy to do it cheaply or even for free, if only the proper channels were in place.

    I teach English once a month to the neighbors as a volunteer — Y800 for 90 minutes. I have a low-level class for the people doing it for fun (mostly older women), and a higher-level class for the serious ones (TOEFL prep questions).

    I am going to use all of the money I collect to buy balloons for the October matsuris.

  3. Hey,
    A lot of what you’re saying is like cleaning up water on the floor without fixing the leak in the ceiling. A Teach For Japan program will never exist because foreigners can never have citizenship or be integrated into Japanese social or business systems in an equal way and its politics serve to ensure this. We can’t WORK the same as Japanese in Japan long term for many reasons, the least of which being language. Thanks to Japan’s insistence on requiring foreigners to learn chinese characters in order to pass company tests, most non-native Japanese (and MANY native Japanese alike), even though they can communicate verbally with fluency, cannot read well enough and do not have the Japanese writing skills to be subjected to the same exams, and expected to complete the same amount of Japanese administrative paperwork. Leaving it virtually impossible for foreigners to advance within their fields.

    Think about it. Someone needs to help the foreigners fill out forms required to even GET benefits.

    Speaking in terms of NETs and Japanese schools, (which you should really visit, I might add ) “Special” ALT roles will always exist for these reasons, and any time you have a segregated portion of the population singled out for its shortcomings (or for anything), you’re never going to have equality.

    Also, (and this is just my conspiracy theory ravings) if westerners with their CRAZY ideas about time efficiency, and their super human “computer skills” (198 WPM last time I timed myself) were fully integrated into the Japanese work force, what would become of all the archaic bullshit that Japan loves so much!?!? Filling out forms and stamping things thirty times through thirty people with their own personal seals so nothing ever gets completed on time. (I lost my hanko, I will have this form to you once the shop around the corner finishes carving a replacement one on…. Monday… no wait that’s “Respect For The Aged Day” he’s closed.)

    For now, I’d be happy if my school would update their 300 pound desktop computers past Windows goddamned 95, and my coworkers would start using EMAIL on a daily basis, let alone foster me along a career track towards living in this CRAZYLAND forever (shoot me in the face).

    I do like your point about JET setting the stage for exploitative dispatch companies that then grow around it. Thats true. But its not a problem with JET. If Japan regulated its teachers so that ANYONE working in a Japanese school was required to be an extension of a government program LIKE JET(fully covered with benefits) these programs would disappear. Osaka ending contracts with Interac teachers (who, yes, seem to show up to work drunk a lot of the time) is a good start.

    If JET disappears, these programs flourish.

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