Yes, you read that correctly. There is a CEO who actually makes just as much as his employees! How much, you ask? According to The New York Times, over the next 3 years, everyone at Gravity Payments will be making $70,000 a year—even the CEO.
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Dan Price, founder and CEO of Gravity Payments, envisioned this plan after reading an article on happiness. It’s been shown that people who make less than $70,000 a year aren’t as happy as people who make that or more. Price founded Gravity Payments, a credit card payment processing firm, in 2004 at the age of 19. He is currently making $1 million a year.
How will he be incorporating this change and making sure everyone else will be getting paid $70,000 as well? By slashing his own salary, of course! He’ll also be using 75 percent to 80 percent of the company’s anticipated $2 million in profit this year to help cover the remaining salary cost. Price employs 120 employees, and 30 of them will be seeing their salaries double with this new policy. About 70 or so employees will be seeing a generous increase as well. Price expects to keep his salary low until the company can earn back the profit.
Price is an anomaly in the CEO world. The New York Times also reports that “The United States has one of the world’s largest pay gaps, with chief executives earning nearly 300 times what the average worker makes.”
CNN.com has recently revealed that the country’s highest paid CEO. Nick Woodman, founder and CEO of GoPro, has an annual salary of $285 million. Most of his salary is tied up in stock options, but it would be interesting to see what GoPro pays its employees now knowing this information!
“Price is an anomaly in the CEO world.” That made me LOL! Talk about an understatement!