Dan Price runs Gravity Payments which is a company based out of Seattle. He signed up for a $1 million pay cut from his salary so that he could pay more to his employees.
Reportedly, this US-based boss opted for a 90% pay cut in his wages so that his staff could receive a $70,000 as minimum salary.
Dan Price took this step back in 2015 and since then his company has grown three times more. He shared that his staff turnover has dropped by half and they're even leading better lives.
After doing the math, Dan rounded the figure to be $70,000 as a minimum salary that'll be offered to the employees.
To pay this amount to his staff, he not only sustained a salary cut, mortgaged his two houses but also gave up on his stocks and savings.
When I started a $70k minimum wage for my company in 2015, Rush Limbaugh said: "I hope this company is a case study in MBA programs on how socialism does not work, because it's gonna fail"— Dan Price (@DanPriceSeattle) August 22, 2020
Since then our company tripled & we're a successful case study at Harvard Business School.
While in conversation with the BBC, Dan shared that:
Before the $70,000 minimum wage, we were having between zero and two babies born per year amongst the team.
It has been 4 and a half year since the announcement and they have had more than 40 babies.
Not just that, in his tweet, Dan mentioned that because of this strategy, employees who owned houses saw 10x growth rate, 70% of them were able to pay off debts.
Since my company started a $70k min wage in 2015:— Dan Price (@DanPriceSeattle) August 23, 2020
*Our business tripled
*Staff who own homes grew 10x
*401(k) contributions doubled
*70% of employees paid off debt
*Staff having kids soared 10x
*Turnover dropped in half
*76% of staff are engaged at work, 2x the national average
The company now has double the national average.
This goes on to say that if more companies make such decisions, employees will be happier and work harder.