Nova Co. has agreed out of court to pay 400,000 yen to a former employee who sued the major chain of language schools after his allowance was cut due to his association with a female student, informed sources said Saturday.
The Australian former teacher was hired by the Osaka-based firm in October 1999 and was promoted three years later to a position that included a 20,000 yen monthly allowance, according to the complaint he filed with the Osaka District Court.
Nova demoted him in February 2004 for what it termed inappropriate ties with a student and cut the allowance.
The man sued Nova last May for roughly 1.8 million yen, including compensation and unpaid allowances, arguing that the company interfered in his private life.
Judge Atsushi Shimoda at the district court urged the two sides to settle the case amicably. They reached the settlement last month.
A Nova employee rule prohibits teachers from associating with students.
The Osaka Bar Association recommended last year that it eliminate the rule after receiving a complaint from a former teacher who was dismissed for associating with a student.