Gravity Payments CEO takes 90% pay cut to give workers huge raise

[tonychat]

CEO Dan Price took a 90% pay cut and slashed his company's profits just so he could give his employees a raise.

Price, who heads up the Seattle payment processing firm Gravity Payments that he founded, has pledged to make sure all of his staffers make at least $70,000 annually in the next three years.

To do that he's cutting his $1 million salary to $70,000, and dipping into the firm's annual $2 million in profits.

This will double the pay of about 30 of his workers and will mean significant raises for an additional 40.

Price told employees of the new pay policy at a meeting Monday. For several moments there was stunned silence before people broke into applause and high fives said Phillip Akhavan, a merchants relations worker whose $43,000 salary immediately jumped 16% to $50,000.

"It took us a moment to understand what he was saying," said Akhavan. His first call was to his wife, who he said didn't believe him at first.

Nydelis Ortiz, a 25-year old underwriter who only started work there in January called her parents with the news. The family had struggled with homelessness after they moved to the states from Puerto Rico when she was a girl, and Ortiz, who also is now paid $50,000 said she now makes more than both her parents combined.

"My mom cried when I told her," she said. Her $36,000 salary was one of the lowest in the company.

Jason Byrd, 38, had struggled to get by in Seattle on his $40,000 salary as a technician. "This gives us so much freedom to just do our jobs and not have to worry about money," he said. He said he'll save some of his extra pay, and try to pay down some of the $42,000 he owes in student loans. "I almost bought a new Jeep today, then I decided I'll keep driving this one until it dies," he said.

Price said he's the majority owner of the privately-held firm, which he started in his college dorm room 11 years ago. His older brother, who gave him seed money to get started, is the only other stockholder.

Related: Hundreds of workers get $19,000 raise

"My brother Lucas reacted with caution and questions, but not objections," said Price. He's single so he didn't have to explain his pay cut to a spouse.

Price decided to hike his employees pay after he read a study about happiness. It said additional income can make a significant difference in a person's emotional well being up to the point when they earn $75,000 a year.

Since PAP like to match private companies salary package..will they match this CEO REAL leadership???

 

[eErotica69]

Tonychat your PM Najib lagi better. He draws a salary similar to Bangla workers and let the rest of his country enjoy the wealth. His wife also live a simple frugal lifestyle.

No wonder Tonychat and his parents support UMNO and Najib.

 

[GOD IS MY DOG]

angmohs truly the best..............no joke...............in s'pore, you can expect the reverse to happen

 

[tonychat]

CEO Slashes $1 Million Salary To Give Lowest-Paid Workers A Raise

Three weeks ago, Dan Price took a $930,000 pay cut.

Growing income inequality had been on his mind for months. But as he went for a hike with a friend one afternoon and listened to her describe her struggle with rising rent prices, he realized he had to do something for his own employees.

So Price, the founder and CEO of Gravity Payments in Seattle, decided to raise the minimum salary at his 120-person payment processing company to $70,000. At a company where the average pay was $48,000 per year, the move -- which was first reported by The New York Times on Monday -- affected 70 workers, 30 of whom saw their salaries double.

Most of the money for these raises will come from cutting Price's salary -- which is now $70,000 per year rather $1 million. The rest will come out of the $2.2 million the company expects to earn in profit this year.

“There’s greater inequality today than there’s been since the Great Recession,” Price told The Huffington Post on Tuesday. “I’d been thinking about this stuff and just thought, ‘It’s time. I can’t go another day without doing something about this.’”

The $70,000 figure is just below the $75,000 salary pegged in a 2010 Princeton University study as an ideal benchmark for achieving happiness. About 28 percent of Americans said they would feel successful earning at most $70,000 per year, according to a 2012 survey from the jobs site CareerBuilder.

The pay cut won’t affect Price's lifestyle much. He has saved a lot of the money he has earned since starting Gravity in 2004. He said he has no plans to replace his 12-year-old Audi, which has clocked more than 140,000 miles. And his new salary will still allow him to pick up the bar tab for his friends once a month, he said.

“There will be sacrifices,” said Price, 30. “But once the company’s profit is back to the $2.2 million level, my pay will go back. So that’s good motivation.”

In the U.S., the average CEO earns more than 350 times what the average worker does. Seattle has become a hotbed in the fight for higher wages as the city phases in a $15 minimum wage, one of the highest in the country. The city is also home to wealthy investor Nick Hanauer, a self-styled champion for higher pay who has warned his fellow billionaires that pitchfork-wielding mobs will follow them to their private jets if income inequality isn’t addressed.

Rather than see this as a charitable offer to his workers, Price sees the pay raises as an investment. In theory, workers motivated by higher salaries will ultimately attract more business and handle clients better.

“This is a capitalist solution to a social problem,” Price said. “I think it pays for itself, I really do.”



ok, this ang moh is willing to give up his million $ salary to help his employees to achieve a better salary package which in turn give them a better life style..

Let us compare this to PAP.. they have more than $1 million in salary and don't even give back the CPF money to the people at age 55..and these are the people's own money... PAP is a 3rd world low life shit.. Please go Join LKY to hell, since you like to suck his dick and lick his ball so much, you can go to hell to do it.

 

[borom]

So different from the bunch who give themselves the highest salaries in the world for doing public service/serving in the political arena.

When you pay yourselves obscene amounts from tax payers monies -history will remember you for that even if you try to call yourselves fanciful names like great leader, supreme leader ect2 while clinging on to power by removing democratic and human rights.