Inc., March 9, 2020: Remember That Company With the $70K Minimum Wage? 5 Years on the Results Suggest More Businesses Should Follow Suit
Remember how five years ago, Dan Price, the CEO of Seattle-based payment processing company Gravity Payments, raised all of his 120 employees’ salary to at least $70,000 a year, taking a huge pay cut to make it happen?
A media firestorm resulted, including here in Inc.com, much of it focused on negative blowback from the decision, including executive resignations, sniping from local startups and a lawsuit from Price’s co-founder (also his brother). Rush Limbaugh called Price “a communist.” All in all, the coverage painted a messier picture than a simple feel-good story of a generous CEO doing good by his employees.
Another way to put that is employees are now actually living secure, middle-class lives and reaching markers of success like owning a home and having kids that were once assumed to be within grasp of most dedicated full-time workers. In short, Gravity Payments put the American Dream back within financial reach for its employees.
Employees responded to this largesse not by slacking off but by working harder. “When money is not at the forefront of your mind when you’re doing your job, it allows you to be more passionate about what motivates you,” one told Hegarty. Senior staff say they’re less stressed than before the pay hike.
