What happened after this CEO raised the minimum wage at his company to $70,000

Saturday 01 August 2015 10:00
Science and Tech

Three months ago Seattle-based CEO Dan Price announced he was raising the minimum wage in his company Gravity Payments to at least $70,000 (£47,000) by 2017.

Since then the tech company has seen several customers leave over the "political statement", two of its most valuable employees quit over fears that the move was unfair to loyal employees, and a lawsuit.

The New York Times, who caught up with Price after the move, also spoke to Gravity's former financial planner Maisey McMaster about why she left.

“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,” she told paper. Another ex-employee, web developer Grant Moran told the newspaper the move "shackles high performers to less motivated team members".

Shortly after the announcement Price was sued by his brother Lucas, over demands Dan buy his stake in the company. Despite the backlash, Gravity Payments - which provides technology for credit card payments - has managed to gain new customers off the back of the move and Price is adamant he wants to continue fighting against income inequality.

“I want to fight for the idea that if someone is intelligent, hard-working and does a good job, then they are entitled to live a middle-class lifestyle," he told the NYT.

It's not just his employees getting a raise: Price will now receive a salary of $70,000, down from $1million (£678,000), and has pledged not to increase his pay until the firm's profits match or exceed last year's $2.2million. He originally decided on the move because executive pay is "way out of whack".

More: Meet the world's best CEO

Trending