{"id":18385,"date":"2015-04-19T04:04:11","date_gmt":"2015-04-19T04:04:11","guid":{"rendered":""},"modified":"2015-04-19T04:04:11","modified_gmt":"2015-04-19T04:04:11","slug":"CEO-cuts-his-pay-so-every-worker-can-earn-70K","status":"publish","type":"post","link":"https:\/\/asiancemagazine.com\/?p=18385","title":{"rendered":"CEO cuts his pay so every worker can earn $70K"},"content":{"rendered":"

We need more CEOs like him!<\/strong><\/p>\n

A CEO who announced that he\u2019s giving himself a drastic pay cut to help cover the cost of big raises for his employees didn\u2019t just make those workers happy.<\/p>\n

He\u2019s already gained new customers, too.<\/strong><\/p>\n

\u201cWe\u2019ve definitely gained a handful of customers in the last day or two,\u201d said Stefan Bennett, a customer relations manager at Gravity Payments, a credit card payment processing firm. \u201cWe\u2019re showing people you can run a good company, and you can pay people fairly, and it can be profitable.\u201d<\/p>\n

Dan Price, chief executive of the company, stunned his 100-plus workers Monday when he told them he was cutting his roughly $1 million salary to $70,000 and using company profits to ensure that everyone there would earn at least that much within three years.<\/p>\n

For some workers, the increase will more than double their pay. One 21-year-old mother said she\u2019ll buy a house.<\/p>\n

At a time of increasing anger nationally over the enormous gap between the pay of top executives and their employees, the announcement received immense attention. But corporate governance professor David Larcker of the Stanford University Graduate School of Business said it\u2019s unclear if Price\u2019s unusual gesture will start a trend.<\/p>\n

\u201cIt\u2019s an alternative way to think about a tough problem, and I give these guys a lot of credit for laying it out there,\u201d Larcker said. \u201cWhether this would scale to a bigger organization, it\u2019s hard to know. But it\u2019s clever, it\u2019s interesting and it\u2019s fun to think about.\u201d<\/p>\n

Washington state already has the nation\u2019s highest minimum wage at $9.47 an hour, and earlier this month Seattle\u2019s minimum wage law went into effect. It will eventually raise base hourly pay to $15.
\n<\/strong>
\nLabor unions and workers in the Seattle area on Wednesday joined national protests for better pay. Drivers for Uber and Lyft, the app-based car-hailing services, gathered in Seattle, while airport workers rallied at Seattle-Tacoma International Airport. In Seattle, police arrested 21 demonstrators who opted for civil disobedience to dramatize their point, refusing to move out of an intersection at the conclusion of their march.<\/p>\n

Gravity\u2019s CEO launched the company from his dorm room at Seattle Pacific University when he was just 19.<\/strong> He\u2019s long taken a progressive approach that included adopting a policy allowing his workers to take unlimited paid vacation after their first year.<\/p>\n

\u201cI think this is just what everyone deserves,\u201d Price told workers in a video of Monday\u2019s announcement released by the company.<\/p>\n

But he also acknowledged it won\u2019t be easy: The increased pay will eat into at least half the company\u2019s profits, he said, and he has no plans to simply raise rates on clients.<\/p>\n

\u201cIt\u2019s up to us to find a way to make it work,\u201d he said.<\/p>\n

Bennett, 28, went to college with Price and has worked for Gravity since graduation. He said he was already happy to work for a company that treats its employees and customers well in what he otherwise considers a predatory industry. For him, the raise will amount to about $10,000.
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