Gravity Payments Owner Drastically Cuts $1M Salary and Sets $70,000 Minimum Wage for All Staff

Christian Post ^ | 04/15/2015 | Leonardo Blair

[I want the USA back]

Liberals really think this is a good thing. Liberalism is the denial of human nature. Human nature needs to be rewarded for productive deeds, and punished for counter-productive acts.
This is going to fail.

[catnipman]

Another difficulty with this approach is that they’ll end up hiring vastly over-qualified folks for the menial positions because applications for open positions will skyrocket. The result will be major dissatisfaction of those who are grossly over-qualified, and soon the whole company will be a morass of vicious back-stabbing and jockeying to claw their way to the top of the corporate ladder by essentially everyone in the company.

[TexasFreeper2009]

You would think that would be the case, but my experience with poor people who don’t know how to handle money (thus one of the reasons why they are poor) is if they earn more... they will simply work less.

This happens all the time with poor people, they will make plenty of money in just a few months of work (more than many earn in a year) but then they will take the next few months off to go fishing or whatever until it’s all gone and then rinse and repeat.

[MeganC]

None of the people at this company would be described as ‘poor’. $43,000 a year for an entry-level position is pretty good money!

[TexasFreeper2009]

a smart competitor would just pay himself zero and his employees the minimum necessary and then undercut this guy on price and drive him out of business. Then once the competition is gone cash out for millions.

[Fido969]

Something about this reeks of a publicity stunt. Credit card processors are hustlers anyway. Watch him to back out of his “promise” as soon as he can.

[plain talk]

lots of supportive comments at some of the sites like cbs marketwatch. Next up — out and out support for communism in the U.S.

[GraceG]

Could be his “pre-emptive Insurance against Obamunism” , of course the alligator won;t eat him now, but the aligator always eats...

[RipSawyer]

The worst part about all of it is that $70,000. a year is NOT a lot of money any longer. Back in 67 as a 23 year old Navy vet with a high school education I was making $5,720. a year plus great benefits and that bought more than $70,000. does now. I was driving a new Mustang that cost me $3,000 and renting a three bedroom brick house for $70. a month. By age 25 I was at $7700 a year which was a far greater income than $70,000 is now plus a benefit package that would be worth probably $25000 a year now.

[Svartalfiar]

Where are you getting all your numbers? He has 120 employees, and this is increasing the paychecks of ~70 of them. (I would assume those making more will expect a smaller raise as well, but let's ignore that.)

30 workers make between 48-69K who will not get a raise to 70K

announced to his 120-person staff that over the next three years, every single employee — even the lowest paid clerk — will be paid a minimum annual salary of $70,000

Let’s say we go with the lowest paid today makes 48,000 and let’s just make all 30 get the lowest paid 48,000.

With the average salary at Gravity standing at $48,000, the new minimum wage is expected to increase the paychecks of about 70 employees and ultimately double the salaries of about 30 of them

Total left every year will be at least 270K in reserves year after year.

To pay for the increased staff wages, Price will cut his almost $1 million salary to $70,000 and combine that with about 75 to 80 percent of his company's $2.2 million expected in profits this year.





The average pay for the employees is 48k. For everyone. So if the minimum is going up to 70k, that means the new expense is at least (70k-48k) * 120, which means his new payroll is $2.6Mil MINIMUM. (The average goes higher depending on how many people make how much more than 70k.) So he's now at least $2600k-930k = $1.67Mil more in the red. And that lines up with the 75-80% cut in company profits from the article ($1.65-1.76Mil cut).

SO, this move is taking his company's expected profit from $2.2Mil down to about $500k. Which, with expected revenue of $15M, gives a 3% profit overall. Not much room at all in case of downturn, unexpected expenses, or to put in the bank.

[Osage Orange]

Okay...so here I am employed by Gravity...I've got a MBA..and I'm doing work that I was employed to do...and let's say I'm making $70k...and now you tell me the office clerk will now make $70k. Same as me....

That's not going to fly....

That said....I think I read that was a minimum.

But still there will be problems....It's Socialism lite...but it's Socialism nevertheless.

[Svartalfiar]

None of the people at this company would be described as ‘poor’. $43,000 a year for an entry-level position is pretty good money!

Actually, several of the people working here are probably 'poor'. If you read the article, that $43k number is just one guy. Reading farther, 30 of them make only $35k, which in Seattle is probably not that much to leftists who can't budget.

[napscoordinator]

Your right about 120....I thought 70 and I guess 70 are going to get pay raise which I thought 30. I don’t know where I got my numbers but it was a combo of reading and TV and I screwed them up. Thanks for the real story.

[Osage Orange]

That is there right to make that money but how much does one need to survive extremely well for life?

Money doesn't define me. Nor does..status.

Power doesn't interest me either.

What good can I do with my money? That is what interests me.

[lormand]

This is a socialist experiment mandated by the CEO. Call it what you want, but that is what it is. It says that everyone is equal and will be paid equal. Having worked in a Union shop for 12 years, I can tell you that it will fail miserably. Equality of results is a utopian fantasy. This experiment will cause jealousy, back-stabbing and division among the employees and the CEO will certainly not move into the homes next to the janitor. It’s all phony and destined to fail.

[napscoordinator]

What good can I do with my money? That is what interests me.

I agree, but you are a super minority in that thought. I would like to think I am generous with money especially with family and friends and the Catholic Church.

[MortMan]

Netflix merely redefined adequate.

[Osage Orange]

I agree, but you are a super minority in that thought.

Oh....I don't know about that. I know plenty of people that give away substantial amounts of money every year.

They basically want to be left alone...even if it is public...if they are Conservative or Republican they will not be noted by the MSM.

I think possibly your view is skewed by the MSM. I'm always surprised at myself....when I think something..and then find out I've been duped by the MSM.

Facts and figures can be smoke and mirrors........

FWIW-

[MeganC]

Okay, so you’d take away their raise and then tell them you’re doing it for their own good and the eventual good of society?

Tell me you’re voting for Hillary, amiright?

[jmacusa]

No need to bet. He’ll be through in six months or less.