Cover Corporation, the company that oversees Hololive Production, recently received recommendations and guidance from the Japan Fair Trade Commission (JFTC) after being found in violation of the Subcontract Act. This case serves as a reminder for large companies to maintain healthy contractual relationships, especially in the booming VTuber industry.
Case Details and Cover Corporation's Response
Between April 2022 and December 2023, Cover Corporation requested 243 revisions without compensation to 23 contractors, including 19 freelancers, for VTuber content creation. In addition, there were 29 contractors who experienced late payments of up to one year and seven months, with late interest totaling approximately 1.15 million yen (approximately 7,495 USD). This action is not in accordance with the provisions of the Subcontract Act that protects the rights of contractors in Japan.
In response to the JFTC's recommendations, Cover Corporation apologized to the affected contractors. The company confirmed that all pending payments and interest have been settled. As part of the remedial measures, Cover Corporation also strengthened its internal structure, including adding new staff, improving workflow, and enhancing training to avoid similar mistakes in the future. These steps were taken to ensure better working relationships and maintain the trust of partners.
Implications of the 2024 Freelance Law
Starting November 1, 2024, Japan will implement a new Freelance Law. This regulation requires companies to transparently explain the terms of employment when dealing with freelancers. Cover Corporation, like other companies, needs to ensure that all contractual terms and compensation for freelancers are clearly explained, as per this new regulation. This step is important to maintain professionalism and ensure compliance with stricter rules.
This case serves as an important reminder to Cover Corporation and the content creator industry of the importance of maintaining a professional and fair working relationship with contractors. With corrective measures and a better working structure, the company is expected to build a healthier relationship with contractors in the growing VTuber industry.
Source: Cover Corporation website Via Anime News Network
