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If you thought the news that Crytek was facing financial hurdles weren’t big enough worry for the company, their Shanghai, China office is practically in a state of chaos. Eurogamer have learned from some of the developers working for the China-based offices that not only are salaries being paid in odd ways, there are also imminent legal battles that the company will soon have to deal with as a result of a breach of contract with their Shanghai staff.

Two employees in the Shanghai studio told Eurogamer that they were effectively being paid two months late, with many of the staff feeling demoralised and unsure of their future. No-one has received salaries for April, May or June and Eurogamer was also told that Crytek Shanghai isn’t paying for the staff’s social insurance either.

This has lead some considering legal action against Crytek for a breach of contract. By law, all employers hiring staff in China, be they local or multinational companies, must pay in  to a social insurance program for their employees. This covers basic pension, basic medical insurance, work-related injury insurance, unemployment compensation and maternity insurance.  By not paying into the social insurance funds, Crytek Shanghai is apparently also breaking the law, which could mean hefty fines for the struggling company.

Eurogamer also made mention that the problems at Crytek probably began right around the time that Ryse: Son of Rome was being developed in 2011. Around 50 staff from Crytek Budapest were axed from the project and anyone remaining was relocated to the Microsoft Game Studios in Frankfurt, Germany, after the Redmond, Washington-based company decided that they wanted Ryse to become an exclusive launch title for the Xbox One. That resulted in the final team numbering around thirty developers working on what was then called Codename: Kingdoms, which took an additional two and a half years to complete.

It’s anyone’s guess how this is going to play out, but it looks like there’s little to stop Crytek from going over the edge now. In order to save itself, the company will likely axe all the separate offices that it cannot support adequately and continue to run the US and UK offices with slightly larger staff complements.

It’s either that, or the company bites the dust, which would be a great pity…

Source: Eurogamer

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