Three weeks ago, Dan Price took a $930,000 pay cut.
Growing income inequality had been on his mind for months. But as he went for a hike with a friend one afternoon and listened to her describe her struggle with rising rent prices, he realized he had to do something for his own employees.
So Price, the founder and CEO of Gravity Payments in Seattle, decided to raise the minimum salary at his 120-person payment processing company to $70,000. At a company where the average pay was $48,000 per year, the move — which was first reported by The New York Times on Monday — affected 70 workers, 30 of whom saw their salaries double.
Most of the money for these raises will come from cutting Price’s salary — which is now $70,000 per year rather $1 million. The rest will come out of the $2.2 million the company expects to earn in profit this year.