Gravity Payments minimum wage will be running to $70,000 a year after a Seattle CEO finalized that he is willing to cut down his salary to same rate as his employees to make it happen.
The Gravity Payments minimum wage change was revealed by Gravity Payments CEO Dan Price after reading an article that more money for employees who earn below $70,000 leads to increased happiness.
It was a regular day for all the Gravity Payments employees until founder Dan Price announced one important change that will be taking place within the company for the next three years. On Monday, he surprised a room packed with 120 staff that Gravity Payments minimum wage will be $70,000 a year.
Dan Price was inspired after reading an article written by Angus Deaton and Daniel Kahneman, a Nobel Prize-winning psychologist that people who make less than $70,000 a year becomes incredibly happy and that money really makes a difference in their life when they receive more money.
"They found that what they called emotional well-being - defined as "the emotional quality of an individual's everyday experience, the frequency and intensity of experiences of joy, stress, sadness, anger, and affection that make one's life pleasant or unpleasant" - rises with income, but only to a point. And that point turns out to be about $75,000 a year.
Aside from cutting down his own $1 million salary a year, Dan Price also planned to trim down the company profit of about 80 percent to its projected revenue of $2.2million in order to achieve Gravity Payments minimum wage of $70,000 a year.
Price's move to make Gravity Payments minimum wage of $70,000 a year surprised his employees during Monday's announcement. He promised that all of his staff working under the company whether new customer service representatives and clerks will be receiving the same minimum wage.
At present, Gravity is giving an average of $48,000 year to its employees. But after Price has read an article on how much income raises augment happiness for people making less than $70,000 a year, h decided to make a change in his own Seattle startup company.
Price founded Gravity Payments in the year 2004 when he was 19. He was only using his own dorm room at Seattle Pacific University as his office, the Daily Mail reports. The idea of processing credit card payments for small businesses struck him one time when he was playing in a rock band in one coffee shop.
Since then, the startup company grew up and last year, it processed $6.5 billion in transactions for more than 12,000 businesses.
After Monday's announcement of Gravity Payments minimum wage of $70,000 a year, all of the employees were caught off-guard. They were speechless during the announcement and only reacted after the CEO's announcement.
Alyssa O'Neal, one of Gravity employees couldn't express the joy she felt after knowing that her salary will be doubled after three years. Now, she started making plans and dreaming big for her family, the King5 reports.
Gravity Payments minimum wage of $70,000 a year didn't just remain big news in the company. It echoed worldwide and has called for other companies to do the same.
What Price revealed can make a huge change in his employees' lives. Gravity Payments minimum wage increase will not only inspire more employees to work hard, but it will then lead to higher productivity. Happy employees, means more revenue!
Congratulations to Dan Price's Gravity Payments minimum wage hike! Kudos to Dan and Gravity!
