13th September 2021
CEO ridiculed for raising minimum wage to $70k triples revenue in 6 years
After finding out that one of his employees was working two jobs to make ends meet, CEO Dan Price raised the minimum annual salary of employees at his company to $70,000 by cutting his own $1.1m pay package down to $70k.
His decision was ridiculed by sceptics, but six years on the companies revenue has tripled, they’re a Harvard business school case study and their employees have had a 10x boom in homes bought.
From the Article:
Six years ago, Gravity Payments CEO Dan Price, 37, discovered one of his employees was working a second job to make ends meet. His response? He gave her, and ultimately everyone in the company a raise to $70,000 per year. He paid for it by dropping his own $1.1 million salary to $70,000. He tweeted “Money buys happiness when you climb out of poverty. But going from well-off to very well-off doesn’t make you happier. Doing what you believe is right, will. ”
When he was interviewed on FOX News, he was laughed at and ridiculed. They said his business would fail, and accused him of being a socialist. However, the FOX employees who ushered him in to the shows emceed by hosts making seven figures, told him they could hardly make ends meet on their minimum wage salaries.
Six years later after the decision that others said would destroy his business, Dan reports that revenue has tripled, the customer base has doubled, 70% of his employees have paid down debt, many bought homes for the first time, 401(k) contributions grew by 155% and turnover dropped in half. His business is now a Harvard Business School case study.
You can read the article in full online: CEO Ridiculed for Raising Minimum Wage to $70K Has the Last Laugh.
Make sure to explore Inspiring Workplaces for other content and insights about Leadership.