Dan Price is definitely a CEO you would love to work for. The 35-year-old leader of the credit card processing company Gravity Payments initially caught media attention back in 2015, when he lowered his $1 million annual salary by 90 percent. He then brought the minimum salaries of his staff to $70,000 per year.
In September 2019, he made headlines once again after he declared that all those who are currently earning the minimum salary at his company’s Boise office would get an immediate $10,000 raise. Aside from that, their pay would go up every year until 2023, when it would be $70,000.
Before that, a majority of his employees were earning below $30,000 annually. Seeing the reaction of his people after the announcement, Price says: “I feel relieved and proud.”
“I do think about how short my time on Earth is, and it’s motivating for me… It just feels right. It’s fleeting. It doesn’t last very long. But it gives me a guide to where I want to go with my life,” he added.
After telling his staff about the incredible news, he immediately heard from them how the added income would impact their lives. One employee who was a single parent told him that he wouldn’t need to work multiple jobs anymore, allowing him to spend more time with his child.
“That was a very impactful one,” Price said, “because I grew up with two parents that neither one of them went to college. And so they had to work really hard to support us and I saw how hard they worked. It was really meaningful for me to see that this guy’s going to be able to spend more time with his kid. That really, really means a lot to me.”
For that employee and others like him, the effect of this minimum salary increase went beyond financial terms – to them, it changed the dynamic of their lives completely.
“A lot of the reaction was from people who now all of a sudden can afford to be healthy, take care of themselves, eat right, be able to take care of their families,” Price recalled. “Those were the things that I was hearing immediately after.”
The inspiration for this move came from a 2010 study by Angus Deaton and Daniel Kahneman that he read.
In it, the researchers found that a person’s happiness and well-being may rise with income, but only up to a certain point. They said that a salary of $75,000 wouldn’t significantly impact an individual’s emotional well-being, and that incomes greater than that could buy life satisfaction, but not happiness.
Around that time, Price was on a hike with one of his close friends, a mom, and a military veteran whose rent just went up by $200.
“It was just throwing her life into total chaos,” Price said of their conversation. “I talked to her about it, and she thought that a salary of $70,000 was the amount that she would need to be able to take care of all of her obligations and her son.”
That’s when he thought that a change needs to happen. So, he elected to lower his salary so that his employees would receive a minimum salary that will definitely improve their way of life. It was a shocking move rarely taken by business leaders in this day.
“It was an active decision to say, ‘I don’t care as much about my own need to be super-wealthy,’” the CEO said. “It looked after people’s most immediate needs to help their well-being.”
To him, the happiness he could share with others is worth more than any accomplishment in this world.
“Those moments where we’re just experiencing pure joy together, it gives me not only joy but the relief of knowing this is where I’m supposed to be,” he said, “that this is what I’m supposed to be doing.”
Dan Price is indeed the epitome of a true leader – one who looks after the welfare of his people before his own!
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