Gravity Payments CEO's decision to pay everyone $70k backfires

[MuttLikeMe]

Three months ago, Mr. Price, 31, announced he was setting a new minimum salary of $70,000 at his Seattle credit card processing firm, Gravity Payments, and slashing his own million-dollar pay package to do it. He wasn’t thinking about the current political clamor over low wages or the growing gap between rich and poor, he said. He was just thinking of the 120 people who worked for him and, let’s be honest, a bit of free publicity.

Yet almost overnight, a decision by one small-business man in the northwestern corner of the country became a swashbuckling blow against income inequality.

What few outsiders realized, however, was how much turmoil all the hoopla was causing at the company itself.

VIDEO:

https://www.facebook.com/nytvideo/videos/1631294743754708/?fref=nf

[yeoman6987]

1. Ashame would have been great to show how things could be

But I still think paying everyone the same is a mistake. What he should have done is pay heads reasonable pay and workers reasonable lower pay but not too low. Economics doesn't work if everyone is paid the same.

[Beaverhausen]

2. Backfires? Because a couple of employees quit?

Give me a break.

[Hydra]

3. Ya, I read the article a few days ago

And it's a mixed bag for the poor guy. Not a backfire.

Most of his trouble seems to be coming from people who are scared of him leading the way to a better system. It's amazing how many people have come to unconsciously "love" the way things have become.

[pipoman]

4. Any change results in change haters hate'n

Positive change is disliked by a lot of the US workforce. Insecure have to be more valued and brandish their income to prove superiority. That said, for morale, I do think everyone at 70 or above at the time of the raise should have received some sort of equity adjustment. Probably a better idea would be to scale workers paying based on merit and responsibilities only at a higher rate than anyone else. I imagined my thoughts if this happened in my company...making pay more level. I am a "self starting go the extra mile type" surrounded by a lot of "what time do I get off and when do I get paid" types....currently I compensated at a higher rate than those who do much less, which motivates me to want to continue giving them my best...I can see how this could stifle productivity and creativity....interesting experiment..

[Ghost in the Machine]

6. **This NAILS IT**

"I am a "self starting go the extra mile type" surrounded by a lot of "what time do I get off and when do I get paid" types"

I was the same way before I got hurt and became disabled. I worked my ass off, no matter *what* the others were doing. I've even had some people that were on a job a LOT LONGER than me say "You need to slow down some! What are you trying to do, make us all look bad??".

Exactly the opposite, I was trying to show MY WORK ETHIC so I could move up with a company. It's how I went from a laborer, to a crew foreman to a Superintendent over 3 crews in about 6 months at one commercial roofing company! Pissed a lot of people off, but I didn't care. I was there to make money, not as a lesson on "how to win friends and influence people".

I built my own crew, and still had to oversee 2 other crews, so that meant hiring a good Lead Man, who I let hire the other workers. I had tried the hiring friends and family bit first, but all they wanted to do was show up, goof off and expect a paycheck at the end of the week. MY boss hooked me up with another Superintendent, who happened to be a Mexican man, and Damien was cool as hell. He hooked me up with my Lead Man, and I had a crew of between 8 to 13 Mexican men working for me, depending on the job size. My lowest paid laborer made $10/hr, and these men worked their asses off for me, but there was a reason for that. We had a bunch of redneck "good ol' boys" that were foremen, and they would hire the Mexicans, underpay them, and treated them like shit. Even the company owner (the company was based out of Alabama & I was in an Atlanta suburb) only referred to them as "the mexicans", as did all the redneck good ol' boys who were foremen.

Anyways, one day one of the "suits" from the office showed up on my job and called us all down for a meeting. It wasn't but a few minutes into the meeting when he started saying stuff about "the mexicans this" and "the mexicans that, blah blah blah" when I said "Hold on and let me stop you right there! These are MEN, they each have a name, and I pointed to each one of my crew and said 'this is {insert name}, and every one of them make YOUR paycheck possible. *You* WILL NOT come on MY JOB and disrespect them by calling them "the mexicans", you got that??" He just stood there flabbergasted for a few minutes, cut his meeting short and left. I looked at my guys and said "ok guys, time to get back to work now, that clown already put us behind". Before they went back to work, each and every one of them came up to me, shook my hand and THANKED ME for standing up for them.

I used to get up on the roof and work right along beside them, just as hard and as long as they did, even though I was told by MY super that the only tools he wanted to see me using besides my tape measure was my brain, the blueprints, the crane or the LULL (all terrain, high-reach fork lift), but from that day forward, those men would NOT allow me on the roof lol. I would bring them materials with the lift or crane, then head toward the ladder.. and they would pull the ladder up on the roof! I could sit on that lift or crane ALL DAY and read the paper and they never needed anything, unless it was more materials. If I got off the lift or crane to go up the ladder to check things out, they would stop me and say "we need more ice and water" or anything they could think of. They would come right out and tell me "you are the boss, we are the workers, if we need you up here for something, we will let you know. You don't work, we do!" They stayed with me for 5 years, and when I got pissed at the owner and decided to quit, they came with me. I already had a job lined up with another roofing company, and told them I had my own transportation, tools AND crew. They hired me on the spot. They went with me through 2 roofing companies, an Iron Working company, and when I started my own company, which I turned over to my Lead Man when I decided to move.

I kept in contact with them for a while, and even had one guy that worked for me, who had saved his money and started contracting on his own, call me one day and wanted me to come be a Super for him. Unfortunately, I had to turn him down because his call came about 2 months after I got hurt. He told me that he was sorry to hear what happened to me, and that he had NEVER forgotten me since the day I stood up for all of them, and wanted to thank me again with this job offer because he wanted ME to train prospective foremen and Superintendents on how to treat workers like men, and human beings.

Okay... I have rambled long enough... too long, actually... just to agree with you.

Peace,

Ghost

[yeoman6987]

7. Thank you for sharing

Not many make a real difference, but you did. I am glad the world has people like you in it.

[dumbcat]

9. Nice story

It's good to see that there is still some of that spirit around. You made my day a little brighter.

[Sunlei]

10. I plan for a new roof soon, a good quality one that will hold up to houston area hurricanes.

I have a good roof now the original homeowner put up and it hasn't ever had any hurricane damage. But its very old, 20 or 30 years? and time for a new roof fairly soon.

If you still manage roofers in the Houston area, please let me know.

[pipoman]

11. Good story, thanks

My story is similar...different field, but similar. I started a thread in DU2 years ago about my story. I updated it a few times if you scroll down.

http://www.democraticunderground.com/discuss/duboard.php/duboard.php?az=view_all&address=236x41536

I am now the Executive Chef for the organization managing the restaurant and 4...soon to be 5 kitchens in our senior healthcare facilities...it's been a great ride from six figures to $8 per hour to a fair salary and actual love of my job...

[miyazaki]

5. Well he could sell it to a real teabagger, and when the bloodbath

begins they'll really have something to complain about when they're kicking rocks down the road.

[Sunlei]

8. a shame those who already made 70k were 'upset' at others bumped up to the same pay.

I hope those who had a major increase for those 3 months saved a nice nest egg

[Beaverhausen]

12. From 200 new customers a month to 350

Yes, backfires.

[alarimer]

13. I have mixed feelings about this

I don't necessarily think every job in an organization should pay the same. Some jobs are more technical, requiring more skills and should pay more than those that don't require those skills. And jobs requiring advanced degrees should be paid more. In addition, time in the job is important. People who have been around longer should get paid more.

But pay scales need to be transparent. Someone on the same level as you, with a similar skill set and time in the position, should be paid roughly the same as you are. There should be no differences based on gender, race or any other similar factor.