Treating your employees right and still being a smart boss might not go hand in hand sometimes. However, Dan Price, CEO of Gravity Payments, has set a brand new example for the bosses of the world.
Six years ago, the credit card processing company's CEO announced that he would cut his own $1 million salary by 90 percent, he wrote on his Twitter account. Not just that, he had also said that he has plans to bring the salaries of his 130 employees up to at least $70,000 per year.?
Price is changing the game in the US where CEOs typically make 320 times as much as their workers, and most of them earn salaries averaging $21.3 million a year as of 2019.?
Battling against all odds, Price's decision has done wonders. On the sixth anniversary of his announcement, he took to Twitter to share that Gravity's revenue has tripled since 2015.?
"Six years later and our revenue has tripled. More importantly, our staff and company are thriving in various ways," Price was quoted as saying by People.com.
He added, "[We have a] 10-time increase in new homes bought and babies born. Employees have increased savings and paid down debts."
Price was also on the receiving end of some criticism back when he had announced his decision. Fox News called him a socialist and predicted that his employees would end up in the "welfare line".?
Price shared some of those clips on social media and said,?"There are still people all over the world who believed we failed because we've been barraged with the scam of trickle-down economics."
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The CEO took this decision after he read a 2010 study by Angus Deaton and Daniel Kahneman. The researchers claimed that a person's happiness and well-being may rise with income, but only to a certain extent.?
After that, he spoke to a friend who said a salary of $70,000 would help her raise a son and pay rent, Price made his decision.?
He also mentioned how it was important for him to share the news with the world who had initially doubted him. He said, "It was important not only to share how we are doing but also how we all need to be skeptical of what we hear on TV and read online. The B.S. detector needs to be on full force knowing that these false economic narratives that benefit the rich need to be defeated by all of us."
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