Firm plans to give 6-12 month salaries  for laid-off workers


NCsoft said Tuesday that it will lay off up to 800 people this month, a plan announced shortly after Nexon acquired the largest stake of its rival online game firm.

The company notified its employees on the same day that it will run a “small but strong and effective” organization with plans to provide compensation programs for the laid-off workers.

NCsoft plans on offering six- to 12-month salaries as compensation to those leaving the company, according to industry sources.

Considering that NCsoft has about 2,400 workers in Korea, the firm will be cutting over 30 percent of its workforce, and scrapping the company’s underperforming divisions such as the casual and mobile business departments.

“NCsoft is going forward with the reorganization to concentrate on strengthening its key competence areas, while daringly getting rid of the operational inefficiency of our organization to create a small but strong and effective organization,” the company said.

It also said the move was necessary, pointing out that it recorded its lowest operating profit in 40 months ― dropping 64 percent in the first quarter compared to the same period last year.

“Some services may be put on hold and some workers may be leaving us in the effort, but we will support them with the appropriate compensation measures for their future journey,” the company said.

In the meantime, industry sources say the restructuring of its workforce is seen as the first step for merging the firm with its new No. 1 stakeholder Nexon.

Last week, Nexon took over 14.7 percent of NCsoft’s shares with its chief saying that the investment was made to combine the development skills of NCsoft with Nexon’s global publishing platform.

Sources also say NCsoft may ultimately play the development studio role for Nexon in the future, with the firm making the decision to shave off departments whose performances or jobs duplicate those of Nexon.

“Although NCsoft is still too big in size, there are rumors within the industry that all that may be left of the company in the future is a game-developing studio as a Nexon affiliate,” said an industry source.

By Cho Ji-hyun (sharon@heraldcorp.com)