And finally…CEO takes $1m pay cut to start company-wide $70k minimum wage
The CEO of an American credit card processing company has today been branded the world’s best boss after taking a nearly $1 million pay cut in order to raise the firm’s minimum salary to $70,000.
According to the New York Times, 30-year-old Dan Price, CEO of Seattle-based Gravity Payments, told his 120 employees on Monday of his intentions to raise the salaries of even the lowest-paid clerks and customer sales representatives to $70,000 per year.
Mr Price asked his stunned workers: “Is anyone else freaking out right now? “I’m kind of freaking out.”
Jubilant scenes then ensued among the workforce which currently has an average salary of about $48,000.
About 70 company employees will get raises, with around 30 having their pay doubled.
Mr Price, who founded Gravity Payments when he was 19 years old, said he will help offset the cost of the company-wide raise by slashing his own salary from nearly $1 million to $70,000.
The rest will come out of the firm’s profits, which are projected at $2.2 million for 2015. Price expects to apply 70 to 80 percent of profits toward higher salaries.
“There’s greater inequality today than there’s been since the Great Depression,” Price said. “I’d been thinking about this stuff and just thought, ‘It’s time. I can’t go another day without doing something about this.’”
Price told the New York Times that he began considering how he could do his part to combat income inequality after reading an article which basically asserted that money can indeed buy happiness, up to about $75,000 per year.
“There will be sacrifices,” Mr Price said, “but once the company’s profit is back to the $2.2 million level, my pay will go back. So that’s good motivation.”
“This is a capitalist solution to a social problem,” he added. “I think it pays for itself, I really do.”
Currently, the average US CEO earns more than 350 times as much as the average worker, by far the largest disparity in the world.