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

Gravity CEO Dan Price has pledged to make sure all of his staffers make at least $70,000 annually in the next three years.


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.

http://money.cnn.com/2015/04/14/news/companies/ceo-pay-cuts-pay-increases/



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.