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Seattle CEO who set firm's minimum wage to $70G says he has hit hard times
The Seattle CEO who reaped a publicity bonanza when he boosted the salaries
of his employees to a minimum of $70,000 a year says he has fallen on hard
times.
Dan Price, 31, tells the New York Times that things have gotten so bad he’s
been forced to rent out his house.
Only three months ago Price was generating headlines—and accusations of
being a socialist -- when he announced the new salary minimum for all 120
employees at his Gravity Payments credit card processing firm. Price said he
was doing it, and slashing his $1 million pay package to pay for it, to
address the wealth gap.
“I’m working as hard as I ever worked to make it work,” he told the Times
in a video that shows him sitting on a plastic bucket in the garage of his
house. “I’m renting out my house right now to try and make ends meet
myself.”
The Times article said Price’s decision ended up costing him a few
customers and two of his “most valued” employees, who quit after newer
employees ended up with bigger salary hikes than older ones.
“He gave raises to people who have the least skills and are the least
equipped to do the job, and the ones who were taking on the most didn’t get
much of a bump,” Gravity financial manager Maisey McMaster, 26, told the
paper.
She said when she talked to Price about it, he treated her as if she was
being selfish and only thinking about herself.
“That really hurt me,” she said. “I was talking about not only me, but
about everyone in my position.”
Approaching burnout, she quit.
Grant Moran, 29, also quit, saying the new pay-scale was disconcerting
“Now the people who were just clocking in and out were making the same as
me,” he told the paper. “It shackles high performers to less motivated
team members.”
Price said McMaster and Moran, or even critic Rush Limbaugh, the talk show
host, were not wrong.
“There’s no perfect way to do this and no way to handle complex workplace
issues that doesn’t have any downsides or trade-offs,” he said.
The Times said customers who left were dismayed at what Price did, viewing
it as a political statement. Others left fearful Gravity would soon hike
fees to pay for salary increases.
Brian Canlis, co-owner of a family restaurant, already worried about how to
deal with Seattle’s new minimum wage, told Price the pay raise at Gravity
“makes it harder for the rest of us.”
“It pains me to hear Brian Canlis say that,” Price said. “The last think
I would ever want to do is make a client feel uncomfortable.”
The Times said Price has dozens of new clients inspired by his move but
those accounts won’t start generating profits for at least another year.
Making matters worse for Price is a lawsuit his older brother filed two
weeks after the pay hike announcement.
Lucas Price, who owns 30 percent of the company, accuses his brother of
taking millions of dollars out of the company while denying him the benefits
of his minority ownership.
The lawsuit has forced Gravity to pay mounting legal fees at a time when the
new salary scale is being eaten up by profits.
“We don’t have a margin of error to pay those legal fees,” Dan Price said
.
The Seattle CEO who reaped a publicity bonanza when he boosted the salaries
of his employees to a minimum of $70,000 a year says he has fallen on hard
times.
Dan Price, 31, tells the New York Times that things have gotten so bad he’s
been forced to rent out his house.
Only three months ago Price was generating headlines—and accusations of
being a socialist -- when he announced the new salary minimum for all 120
employees at his Gravity Payments credit card processing firm. Price said he
was doing it, and slashing his $1 million pay package to pay for it, to
address the wealth gap.
“I’m working as hard as I ever worked to make it work,” he told the Times
in a video that shows him sitting on a plastic bucket in the garage of his
house. “I’m renting out my house right now to try and make ends meet
myself.”
The Times article said Price’s decision ended up costing him a few
customers and two of his “most valued” employees, who quit after newer
employees ended up with bigger salary hikes than older ones.
“He gave raises to people who have the least skills and are the least
equipped to do the job, and the ones who were taking on the most didn’t get
much of a bump,” Gravity financial manager Maisey McMaster, 26, told the
paper.
She said when she talked to Price about it, he treated her as if she was
being selfish and only thinking about herself.
“That really hurt me,” she said. “I was talking about not only me, but
about everyone in my position.”
Approaching burnout, she quit.
Grant Moran, 29, also quit, saying the new pay-scale was disconcerting
“Now the people who were just clocking in and out were making the same as
me,” he told the paper. “It shackles high performers to less motivated
team members.”
Price said McMaster and Moran, or even critic Rush Limbaugh, the talk show
host, were not wrong.
“There’s no perfect way to do this and no way to handle complex workplace
issues that doesn’t have any downsides or trade-offs,” he said.
The Times said customers who left were dismayed at what Price did, viewing
it as a political statement. Others left fearful Gravity would soon hike
fees to pay for salary increases.
Brian Canlis, co-owner of a family restaurant, already worried about how to
deal with Seattle’s new minimum wage, told Price the pay raise at Gravity
“makes it harder for the rest of us.”
“It pains me to hear Brian Canlis say that,” Price said. “The last think
I would ever want to do is make a client feel uncomfortable.”
The Times said Price has dozens of new clients inspired by his move but
those accounts won’t start generating profits for at least another year.
Making matters worse for Price is a lawsuit his older brother filed two
weeks after the pay hike announcement.
Lucas Price, who owns 30 percent of the company, accuses his brother of
taking millions of dollars out of the company while denying him the benefits
of his minority ownership.
The lawsuit has forced Gravity to pay mounting legal fees at a time when the
new salary scale is being eaten up by profits.
“We don’t have a margin of error to pay those legal fees,” Dan Price said
.