Crytek CEO says he withheld pay in order to save the company

[Dietrichw]

Source

 

 

Crytek came perilously close to insolvency during the past few weeks, and CEO Cevay Yerli had to take drastic measures to save the company, he said in an interview with Eurogamer. An injection of cash, the source of which Yerli was unwilling to name, has propped the company up for now. Crytek is down to 700 employees, from a high of around 900. Reorganization is still ongoing. Yerli could not comment on whether or not more studios or game properties would be up for sale in the near future.

 

Rumors have been swirling recently that Crytek missed its payroll. Yerli says he and the management at Crytek had to make a difficult decision to withhold paychecks and tried their best to prepare the employees for some tough times.

 

"You have two choices," Yerli said. "Either you delay payments — again delay... it's not that they didn't get paid, they got delayed — delay payments and salvage the company. Or, you push your cash flow directly to the studios and you file for insolvency. Both options are really bad. So you have to make the better of the two bad decisions."

 

Yerli says that employees were alerted, through internal communications, that payroll would be missed. They were encouraged to "work with different banks at a personal level to prepare." Alternately, they could resign and seek employment elsewhere. Those who stayed on with the company received bonuses, which Yerli called "inconvenience payments," once their paychecks resumed

 

 go and read the full article as it really opens up what happened inside Crytek

[dizmo]

Still, those workers who need that money to live...so delaying payments isn't really a great answer.

If I was an employee I'd be filing motions with their countries labor relations.

[Rorgash]

Still, those workers who need that money to live...so delaying payments isn't really a great answer.

If I was an employee I'd be filing motions with their countries labor relations.

they had the choice to resign, they chose to stay and not get paid on time

[AMICLG]

they had the choice to resign, they chose to stay and not get paid on time

Not to mention they make a metric ton of money every game so they were likely fine for a year at least.

[Xorbot]

I am not sure how long I'd push it in terms of not getting paid, but let's say 6-weeks or 3 pay cycles.

 

One thing to note is that these jobs are not exactly minimum wage, and it should be expected that people have a good 3-month's worth of living expenses on-hand for emergency situations such as not getting paid.  For the employees that stayed, it may be likely that they are handling their finances properly, and they have "weathered the storm" and are now rewarded for it.

 

Whoever you are, try not to live paycheque to paycheque.  Stop buying ANYTHING until you hit that 3-month expenses buffer mark.

[kuddlesworth9419]

Still, those workers who need that money to live...so delaying payments isn't really a great answer.

If I was an employee I'd be filing motions with their countries labor relations.

It's pretty shitty that they didn't get paid however at least they still have a job to go to. I assume they have all been paid now though.

[Imaginaerum]

One thing to note is that these jobs are not exactly minimum wage, and it should be expected that people have a good 3-month's worth of living expenses on-hand for emergency situations such as not getting paid. 

 

If everyone did this the recession wouldn't have happened.

[Xorbot]

If everyone did this the recession wouldn't have happened.

 

I guess I expect too much of people... 

[Misanthrope]

Yeah listen: You ain't got 2 fucking choices dipshit, you only got one and it's pay your employees. You're lucking you're not tied up in court right now and now have basically 0 fucking credibility as an employer and no sane dev with other choices will ever choose to work for you again.
 

Sorry but as much as I'd like to see more engines and games from Crytek this is an absolute fucking shit move on their part: I also got two choices which is either support your bullshit or stop buying your games, guess which one I will choose now?

[Scionyde]

So the choice was to either delay paychecks for a few weeks or declare insolvency and probably be forced to lay everybody off? Yeah...I'm fine with his decision.

[loepa]

Well this confirm that crytek is in serious trouble.

 

I really hope that crytek will survive and thrive. I really love their engine(s).

[jaggysnake57]

it feels more like stall tactics 12 months from now and crytec will be dead

[martinrox1568]

Yeah listen: You ain't got 2 fucking choices dipshit, you only got one and it's pay your employees. You're lucking you're not tied up in court right now and now have basically 0 fucking credibility as an employer and no sane dev with other choices will ever choose to work for you again.

 

Sorry but as much as I'd like to see more engines and games from Crytek this is an absolute fucking shit move on their part: I also got two choices which is either support your bullshit or stop buying your games, guess which one I will choose now?

They had the choice to quit. So your idea is to pay them and then file for bankruptcy ??? What the hell does that do. Then they don't get payed ever. This way they might have a rough couple weeks but will make it through

[matin94]

im sorry but employees come first, not the company.

[Humbug]

I admit I have no experience working in the games industry. But 900 employees seems like way too much for Crytek, and that's a lot of salaries to pay.

Maybe all this will help them to trim the fat and come out stronger. They are already down to 700 now.

[brownninja97]

Im sure a lot of people are angry about this but im trying to look from another point of view, it comes down to either missing money for a month or two versus the loss of 700 jobs permanently, to be honest I think this guy that started this actually made the correct decision, people had the chance to leave if they wanted to, they were also alerted that shit is going down big time. Then they got rewarded with extra pay for sticking through it, to be honest in that situation i dont see another option, you would be fucking retarded to try and pay the wages of people when you dont have the money to do so. yes there are the down sides to this like people in debt etc but they got a reward as a result im not sure how much that is. This was a extremely hard choice to make, id rather not get paid for a short while instead of completely lossing my job that would suck big time.

[The_Strict_Nein]

Yeah listen: You ain't got 2 fucking choices dipshit, you only got one and it's pay your employees. You're lucking you're not tied up in court right now and now have basically 0 fucking credibility as an employer and no sane dev with other choices will ever choose to work for you again.

 

Sorry but as much as I'd like to see more engines and games from Crytek this is an absolute fucking shit move on their part: I also got two choices which is either support your bullshit or stop buying your games, guess which one I will choose now?

 

No, it was pay everyone late or never pay anyone again.

 

I think I know which I'd prefer

[RH00D]

im sorry but employees come first, not the company.

Just think about that for a moment. You would rather the employee's not have had a delayed paycheck but then had the whole company go under so every employee would be without a job? Because being without a job is better than a delayed paycheck?

 

Not paying employees on time is not acceptable at all, but if your other choice is to leave them all unemployed... Then its the better choice to delay.

[Trik'Stari]

Just think about that for a moment. You would rather the employee's not have had a delayed paycheck but then had the whole company go under so every employee would be without a job? Because being without a job is better than a delayed paycheck?

 

Not paying employees on time is not acceptable at all, but if your other choice is to leave them all unemployed... Then its the better choice to delay.

Agreed.

 

It was a shit sandwhich, everyone had to take a bite. I'd rather have a late payment (although I'd charge a late payment fee as would any company) than have the company go under.

 

The opposite is like saying well if we can't get rid of this nasty hiccup we might as well just kill you.

[matin94]

Just think about that for a moment. You would rather the employee's not have had a delayed paycheck but then had the whole company go under so every employee would be without a job? Because being without a job is better than a delayed paycheck?

 

Not paying employees on time is not acceptable at all, but if your other choice is to leave them all unemployed... Then its the better choice to delay.

they would have to sell the company and make them redundant, the employees would get money depending on how long and what position they had in the company.

if i hired u to do my work this month and at the end of the month i said, sorry i need the money, how would u feel? knowing u have a house, car and a family to support?

it was a complete selfish move. u dont make enough to support your own company, u cut down on staff and other costs before it gets to the stage of choosing between the two.

if it was me, i'd rather be laid off than working and not getting paid for it, if the employees knew, they would have started looking for a job before being put in a horrible situation.

 

from my point of view, if i work for someone, i expect them to pay me according to my contract and monthly basis. no ifs or buts, thats the way it works.

[patrickjp93]

im sorry but employees come first, not the company.

Without the company there is no source of employment. This move was made for the employees whether you like the idea or not. Management delayed paying itself as well.

[patrickjp93]

they would have to sell the company and make them redundant, the employees would get money depending on how long and what position they had in the company.

if i hired u to do my work this month and at the end of the month i said, sorry i need the money, how would u feel? knowing u have a house, car and a family to support?

it was a complete selfish move. u dont make enough to support your own company, u cut down on staff and other costs before it gets to the stage of choosing between the two.

if it was me, i'd rather be laid off than working and not getting paid for it, if the employees knew, they would have started looking for a job before being put in a horrible situation.

from my point of view, if i work for someone, i expect them to pay me according to my contract and monthly basis. no ifs or buts, thats the way it works.

Only in a perfect world does that truly work. Some advice from my parents who worked in the financial sector: never get a mortgage without having 20% on hand and 8 months worth of expenses in liquid cash. People needed to be responsible with the pay they had too. Financial emergencies can hit anyone and any company even with the best of preparation and management.

There is a difference between labor defending itself from abusive employers and being so selfish as to destroy the company they work for and likely love dearly by demanding pay on time no matter the circumstance.

[Misanthrope]

They had the choice to quit . So your idea is to pay them and then file for bankruptcy ??? What the hell does that do. Then they don't get payed ever. This way they might have a rough couple weeks but will make it through

 

Not only the option to quit but the option to demand pay immediately without further delay. That's how labour law works the payroll is sacred, all this bullshit about "oh we warned employees" and such (which by the way we have no way to know if they actually did) but so many companies actively work to intimidate employees into not suing them or pursuing more complains.

And yes they should pay them and go bankrupt but come on, they could have easily sold assets to cover their immediate needs only people who still suck their thumbs would take what this fucking clown is saying at face value.

[mr moose]

I wish some people had a little bit more insight and experience before posting,  this mindset of entitlement that is coming through is very dangerous and will only land you on your arse in the street, Mark my words.

 

All the older people around you today who own their homes, manage companies or are on the board of directors etc etc, are there because they worked their arse off and sometimes without pay to see that the company survived and to ensure they had a job the next day,  that kind of work ethic takes you places. the only place demanding your right to pay without concern for the bigger picture takes you is unemployed and with no company to employ others.

 

It is not black and white, companies can't just keep selling stuff to survive, They can sell some stuff and trim down, but if they sell too much they will become insolvent.