The way bosses look after their staff has come a long way since the death-trap factories of the industrial revolution. But one boss in the Seattle has taken a bold move which is likely to raise the eyebrows of even the most progressive manager in Britain. Dan Price (pictured), CEO and founder of Seattle-based financial tech firm Gravity Payments announced earlier this week he will pay all his employees a minimum salary of $70,000 (£47,500).
According to the New York Times, the move was inspired by Price reading an article suggesting that $70,000 was the magic salary above which workers stop caring so much about how much they earn. Gravity employs 120 staff, of which 70 will see their pay go up and 30 will see theirs double.
It's the sort of thing that's easy to write off as a publicity stunt but the change won't come cheap. To pay for it Price will use almost 80% of the firm's profits this year and take a personal pay cut of more than 90% from $1m to the $70,000 sweet spot.
Asked how much it would have an impact on his lifestyle, he didn't seem to worried. 'I haven’t even thought about that at all, too much,' he told ABC news. 'My life started pretty simple, in a lot of ways. I don’t have a lot of financial obligations or debts. I may have to scale back a little bit, but nothing I’m not willing to do. I’m single. I just have a dog.'
Assuming he still owns a solid chunk of the business, when he cashes out in a few years the sale might still be more than reasonable compensation for the pay cut. If nothing else, Price's decision highlights the growing gap between executive and wider employee pay. 'The market rate for me as a C.E.O. compared to a regular person is ridiculous, it’s absurd,' he told the NYT. Bosses in the UK are unlikely to follow Price in offering such dramatic raises relative to their own pay, but his example might give those on multi-million pound salaries food for thought.