It was in 2015 when Dan Price, a business owner, had a deep conversation with his friend Valerie about financial problems.
Even though she was earning $40,000 a year, she said that it was not enough to cover bills and rent. While Price earned $1.1 million a year, thanks to his company Gravity Payments.
After some contemplation, he realized he had to do something for his staff members. He realized they should be paid at least $70,000 so they could live in the city at ease. That’s when he mortgaged his two houses, sacrificed a huge chunk in his salary, and gave up savings and stocks.
His decision doubled the salaries of one-third of his employees and increased others. But Price says he has no regrets and that the company is reaping the benefits because of his decision.
In an interview with the BBC, he said: “There was a little bit of concern amongst pontificators out there that people would squander any gains that they would have. And we’ve really seen the opposite.”
Since the chance, over 10 percent of his employees managed to buy their own house.
“Before the $70,000 minimum wage, we were having between zero and two babies born per year amongst the team,” he added. “And since the announcement – and it’s been only about four and a half years – we’ve had more than 40 babies.”
The move affected not only the employees’ personal lives but also the company.
Rosita Barlow, the director of sales, said that senior staff have had their workload reduced as junior colleagues can work harder without financial problems in their mind.
“When money is not at the forefront of your mind when you’re doing your job, it allows you to be more passionate about what motivates you,” she expressed.
When Rosita’s salary was increased to $70,000, he moved closer to the office and can now spend more on his health and proper meals.
“You’re not thinking I have to go to work because I have to make money,” Rosita added. “Now it’s become focused on ‘How do I do good work?’”
Price hopes that his move would also inspire other businesses to follow the same structure.
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Replaced!