China’s foreign high-end English language training brands have been under scrutiny, even before the coronavirus outbreak. Web English collapsed late last year, Meten merged with an education-oriented acquisition company at the end of March and even EF was reportedly looking for a buyer in China (but has since put that plan on hold due to the current covid-19 situation).
Wall Street English, sold by Pearson in 2017 to Baring Private Equity Asia (BPEA) and CITIC Capital Holdings Limited (CITIC Capital), is another sizable operator in China.
But it has downsized its teaching capacity and a number of the company’s employees have described a series of decisions by senior management that have left them out of pocket, unemployed and without the proper papers needed to legally find new jobs.
“I have a lot of experience with teaching and I’ve never known anything like this,” said one former employee.
“They’ve used the virus as a way of getting out of paying salaries”
The teacher claimed to The PIE News: “They’ve hidden behind the virus. They’ve used the virus as a way of getting out of paying salaries, of terminating people and of forcing people to resign.”
On January 31, Wall Street English sent an email to its China-based employees with revised dates for returning to work. The government had decided to extend Chinese New Year in order to buy time to prevent the spread of Covid-19.
“After the normal return to work according to the time stipulated by the local government, all employees need to go to work normally,” the email stated.
Employees were mostly working via computer at home, although those who didn’t have access to the necessary equipment continued to work from centres in order to make use of facilities there.
A few weeks later on February 24, CEO David Kedwards held a town hall meeting with employees over the social media app WeChat. Such meetings were held regularly and attended by staff across China. The idea behind them was to make announcements and give employees a chance to send in questions for senior management.
Many were unable to attend due to class scheduling conflicts: they therefore didn’t hear until later that Kedwards had announced that the entire staff’s salaries would be cut for February by 50%, meaning they would only receive half of their wages for work already done, without it being repaid in the future. Kedwards himself said he was taking a pay cut of 60%.
“We’ll also be looking to defer previously earned bonuses until after the crisis,” he added. “And we’re gonna need to stop any bonuses going forward whilst the crisis is still on us.”
In the days that followed, staff were sent agreements that stated that the pay cut laid out in them had been reached by both parties “based on good faith”, adding that bonuses would be paid back in “Q3 of 2020 on condition that the government declares the end of the outbreak and Party A’s business recovers”.
“There wasn’t any negotiation at all”
“There wasn’t any negotiation at all. We got the letter for us to agree to the 50% cut, which I didn’t sign.
“In fact, I emailed back and said, no, I don’t accept it, but they cut the money anyway,” one employee told The PIE.
“We went to the Labour Department to complain and they called somebody in HR. HR said that they negotiated and we agreed, which is not true.”
Whether or not employees negotiated is important positioning, they say. Under laws brought in by Chinese authorities during the coronavirus outbreak, employees had to consent to any wage changes and be given the opportunity to negotiate. Staff say this never happened.
Several teachers quit on the spot in protest, while others wrote to the CEO to complain. They say his reply “didn’t address any of the questions raised”.
“Somebody else sent an email and got the same response. It was just a cut and paste job,” the employee adds.
A few days later it was announced pay would be delayed as the new salaries were recalculated. Although wages went back to normal for March, the problems for teachers were just beginning. Up to 1,500 employees were reportedly suddenly laid off, effective immediately, according to sources who spoke with The PIE.
“What exacerbated the problem for me is that the majority of us took a loan with the company when we moved to China in order to put down a deposit on an apartment,” one teacher, “Charlotte” remembers.
In China, the initial payment for an apartment is usually the equivalent of two months rent as a deposit plus the first month of rent.
Having already taken an involuntary 50% pay cut for work already done, Charlotte then found that the loan repayment was being taken out of her severance pay, so she went to speak to a manager.
“We continue to do our utmost to support and protect our students and employees”
“She started screaming at me and insulting me to a degree that I cannot begin to describe. They stole my entire severance to cover the loan. Wall Street English just did what it wanted to do,” she says.
“At least I had some savings before this but some [teachers] had paid a lot of money to come over here,” another teacher “Jack” tells The PIE.
“And the company was supposed to pay their airline ticket to go back to their country at the end of the contract and is refusing to do that.”
Some of Wall Street English’s remaining staff are now preparing their next steps (and leaving none too favourable reviews on Glassdoor) due to a belief that operations in China may not be continuing into the long-term.
The company declined to comment on “market speculations” or the claims of its employees.
“Naturally we have adjusted our business. While our offline centres in China have remained closed since January 2020 in line with government requirements, all students do have access to our online learning system and our teams continue to deliver online classes, which are safer, more accessible and flexible in these uncertain times,” a spokesperson said.
“We continue to do our utmost to support and protect our students and employees in the current difficult circumstances.”
The names of all Wall Street English staff mentioned in this article were changed.
