Report: Crytek Staffers Haven't Been Properly Paid Since April

[Steven Bogos]

Report: Crytek Staffers Haven't Been Properly Paid Since April

A number of staff at Crytek's UK office have reportedly not been paid their full salary since April 16.

While Crytek was quick to Develop Online [http://www.escapistmagazine.com/news/view/135629-Crytek-Reports-of-Looming-Bankruptcy-Are-False] suggests that the company may still be in a tight spot. According to Develop's source, a number of staff at Crytek UK have not been paid their full salary since April 21st.

While they aren't completely working for free (the source claimed that employees had received small payments of around £700 last month), its no-where close to the full salary the workers expect. A further payment was paid on June 16th, with staff then told to expect another payment on Friday, June 27th. The source claims however "this now looks like it won't happen either".

Apparently, Crytek is looking to make a deal to secure money from Deutsche Bank.

In the mean time, to add insult to injury, Crytek has reportedly promoted several staff members to senior roles - which require a full three months notice if they chose to resign - but not given them the corresponding pay raise.

Crytek UK is currently working on Homefront: The Revolution under a team of around 90 developers (though that number may have decreased).

While this is all rumor and speculation at this point, it's not the first report we've heard of Crytek staffers not being paid, and certainly doesn't bode well for the company.

Source: Develop Online [http://www.develop-online.net/news/crytek-uk-staff-not-paid-full-wages-since-april/0194556]

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[blalien]

Are the executives getting their full salary? If so, I would go on strike.

 

[Flunk]

If I worked for Crytek I would find another job and then sue them for unpaid wages. Jump off that sinking ship!

 

[Denamic]

Workers remaining in the company while it's obviously going under, I can understand. Loyalty to their team and whatnot. But I wouldn't stick around after 'promotions' obviously meant to keep employees from leaving. Might as well use tactics to get fired if you're being treated like that.

 

[EndlessSporadic]

It's a shame. The CryEngine is an absolutely beautiful game engine.

 

[Therumancer]

Are the executives getting their full salary? If so, I would go on strike.

I don't know their arrangement, but the situation is probably one where they borrowed a bunch of money to develop a game on their own so they could reap the profits from it directly, as opposed to a traditional publishing/producing arrangement where they work for someone else who assumes the financial risks and reaps the rewards. As a general rule the money going into development goes towards paying human resources, as in the scope of game budgets the cost of things like office space and computers are fairly cheap. It comes down to how much the devs want to pay themselves while they work on a project, inflated opinions of themselves even at the lowest rungs, has of course done a lot to increase the cost of games, despite the way the buck is passed onto things like "new technology" (at the end of the day it still comes down to hiring the same coders, artists, etc... oftentimes on the same team you had before, but this is another entire discussion). In a typical publisher-dev relationship if the game goes over time and over budget the publisher pretty much decides whether it wants to pump more money into the product to finish it, or hit the "kill button" to cut further losses. In some cases a publisher in this case might go after a dev for wasting their money through a lawsuit or whatever to try and recoup losses (ie the money they were paid without results). In a case where a dev is borrowing the money to more or less release the product themselves, when they run out of cash they need to find someone else willing to back their project and give them even more money, which means selling the further investors on the idea that the product they are working on will make enough profits to pay off the most recent loan, as well as the ones they had before. In this case the developer is running the risks directly by putting itself into very direct debt.

While a lot of people don't like the way I present the game industry at times, the bottom line here is probably that Crytek got it into their heads that they could make money off of a "Homefront" sequel for some reason, which is of course kind of silly since that game seemed to be generally panned. They borrowed money to make it, spent the money paying themselves during development, but didn't finish the game, and without any more money left in their coffers they are put into the position of basically working for free and hoping there will be returns sufficient to give them "back pay" or cutting the project entirely, which could be a problem depending on the terms of the money they borrowed, and who actually becomes liable for that debt. God forbid they did something stupid like seeking alternative funding from organized crime or whatever in addition to whatever else they borrowed.

It's likely we'll never know the truth, but the big thing to look at here is not so much how much these guys are getting paid now (or not getting paid) but how much they were getting paid when the project started, and of course
how long this project was under development. I'm guessing it's not a typical publisher relationship or the guy who was gambling on them would already be in the position of "give them more money, or pull the plug" as opposed to seeing them work under these conditions. In all likelihood we'd only hear about it if the plug was pulled and Crytek moved onto another project with this joining the ranks of failed sequels turned vapourware, or was forced to disband and go out of business. I'm guessing a lot of the workers are still working under these conditions because of contracts, and the simple fact that if they don't finish they will likely get nothing, as well as probably having been paid quite well (enough to drain the coffers) earlier in the process before reality hit.

I'd find it darkly amusing if in a few weeks we find the entire Crytek team disappeared, with perhaps a few severed body parts showing up in odd places. Simply because despite some vague rumors, especially with Asian game companies, about organized crime being involved (mostly in money laundering), we haven't really had a gangland legend about the gaming industry. Some company of 90 employees borrowing money from a crime boss as equal partners, failing, and then being made an example of would be a first for the gaming industry, most other businesses have their stories like that (don't even get me started on the Casino/Entertainment industry, or some of the garbage about the Resteraunt business and all the exaggerated, but still very likely true stories there), and the gaming industry has so far been left out.
Of course I have nothing against Crytek (and this is just me being outlandish for the sake of fun), and if I had to pick the "perfect" crime story, it would probably somehow end up with an EA CEO's head appearing in a company water cooler. Of course the thing about EA is they aren't desperate enough to seek that kind of financing, unlike companies desperate enough to develop Homefront sequels which makes it unlikely, but vaguely possible.

 

[Nurb]

Not only is their engine bloated and inefficient, their company is too. Oh why did Star Citizen have to pick that garbage.

 

[Jadak]

In the mean time, to add insult to injury, Crytek has reportedly promoted several staff members to senior roles - which require a full three months notice if they chose to resign - but not given them the corresponding pay raise.

It's not like they could be promoted and assigned new contract obligations against their will. I'd imagine they had to agree, making it not much of an insult. And even then, I would think a little thing like 'not getting paid' would be considered a breach of any such contract and give them a way out.

 

[FalloutJack]

Well, we can't have that. Not paying our employees is one of the worst things in business history that you can do.

 

[Sniper Team 4]

I want to work in the video game industry instead of my current retail job, but hearing stories like this make me extremely uneasy about the field. Not getting paid, either properly or at all, seems to be a bit too common for my liking. At least at my current job I've never had to worry about that.

 

[Keji Goto]

Crytek is a sinking ship and this is all because of a terrible business model the higher ups in the company didn't fully explore before committing to. Focusing on Free-2-Play when your bread and butter has been AAA FPS titles is beyond stupid in my opinion and this is a direct result of that. Games like Warface have bombed everywhere except for Russia due to the market already being quite crowded and better alternatives being available. Trying to break into a crowded MOBA scene is also foolish when every other company has their sights set on this genre and arguably already have better offerings than Crytek could hope to show up with.

From my understanding Ryse 2 fell apart because Microsoft and Crytek couldn't agree on who would own the rights to the IP which has left Crytek strapped for cash as they try to fund their F2P ventures which have zero income at the moment. Here you had a studio who built its name providing top quality shooters which raised the bar in the visual department and then decided to move towards a business model where their strengths meant nothing. Purchasing a studio like Free Radical the Time Splitters franchise basically amount to money wasted as all Crytek wanted to do was build a F2P version of the IP which fans were clearly not interested in nor would they ever be interested in.

This studio is going down fast and they are scrambling for a means to keep this from happening. As publishers pull out and projects get canceled due to lack of funding their options grow fewer and fewer because everyone can see the writing on the wall. Within a few months Crytek will fail, the employees will scatter, and this will be yet another shining example of not counting your chickens before the eggs hatch. I hope everyone who didn't create this issue over at Crytek finds a new job soon and those who created these issues find themselves without work because they don't deserve to be employed for dragging an entire studio down like this.

 

[paragon1]

It's official, that IP is cursed.

 

[Vivi22]

Are the executives getting their full salary? If so, I would go on strike.

Better to look for another job and sue them for your wages once you've left. If they're actually at the point where they're not paying people what they're owed then the company is a stones throw from bankruptcy. Even if they somehow managed to turn it around, there's no sense staying when you're not getting paid and your future is in question. And if Crytek did go bankrupt and was bought out most of the workers would probably be sacked anyway.

There's no sense striking at a company that doesn't have the money to pay you. Striking is better left to workers at companies that are doing well which are treating them unfairly.

And, of course, none of this is even touching on the fact that game development is a pretty tight knit community. Everyone seems to know everyone, and actually striking might be a good way to get yourself blacklisted at any other developer you'd apply for.

 

[TiberiusEsuriens]

It's a shame. The CryEngine is an absolutely beautiful game engine.

It sounds like worst case scenario is that they get bought by the World of Tanks guys. It's almost a guarantee that they would want to continue work on CryEngine. If this ends up being the case, most people at the company would be able to keep their jobs, thankfully.

 

[Lightknight]

What's interesting is that despite Crytec's well known name, they haven't produced that many good games. There was the original Far Cry and then Crysis that was made famous for having stellar graphics.

Looks like they got caught up in the big budget free to play shenanigans as well and Ryse was hardly a game.

Companies that haven't made reliably good products in years deserve to struggle until they correct their ways or go out of business.