News Sharing The Wealth

[anthony]

I love this piece:

Link Removed

Dan Price, founder and chief executive of payment processing start-up Gravity Payments, has cut his own salary by 90 per cent to set a $91,000 (US$70,000) annual minimum wage at the firm.

The news from Price, 30, became viral after the announcement made in a YouTube video this week was picked up by CNN, The New York Times and other news organisations.

“We’re going to have a minimum of $91,000 (US$70,000) for everyone who works here,” Price said.

The pay boost will be phased in over the next three years, with the lowest-paid employees getting at least $65,000 (US$50,000) by the end of this year and the $91,000 (US$70,000) pay level reached by December 2017.

Price added that his own pay package of $1.3 million (US$1 million) annually is “really high” and that he had decided to reduce his own pay to the same as other employees’ (about US$70,000) “until our profits go back up.” The announcement drew wild applause from employees at the Seattle-based firm that employs more than 100 people. The news comes amid an ongoing debate about wealth, wage, and income inequality in the United States.

http://gravitypayments.com

 

[Neverthesame]

This may sound a bit odd but, I think this may not be as good a thing as it would seem.

The reason I say this is. Imagine you were working at this company, in whatever job that they they label as "entry level". You have now suddenly gone from a job any shmuck can do, at the usual competitive salary scale for a job not requiring any above and beyond qualifications. To theoretically the same job with an astronomical amount of pay.

This leads me to think that one of a few possible outcomes for the poor fool, that has found his or herself in possession of this lucrative by lottery job.
- You have a sudden and intensely cutthroat turnover, as everyone and their dog wants desperately to work there.
- Massive spike in the expectations of the management/board of directors. After all, they are paying you a huge paycheque. You had better work your ass off. As there is no shortage of applicants.

While I commend the CEO for being so "socialist" in thinking. Unless this becomes a new trend, with many more companies following suit. I can really only see that place becoming a toxic and miserable sweatshop. All I know is, I don't think I want to work there.

 

[Friday]

Don't know how public it was, but Adobe (another Seattle company) did something very similar a few years ago. Shite economy, the entirety of management voted to cancel their bonuses & vacations & upper management lowered their own salaries (or flat out discontinued them) until business picked back up, rather than to lay off a single person or outsource. No management jobs were on the chopping block. This was all to save the low end jobs in the company. Not middle or high. There are some damn fine companies in the region who have really been stepping up to the plate for their employees over the past few hard years!!! :D

It should also be noted that 71k is lower middle class in the Greater Seattle Area, as cost of living is very expensive. Apx 40k is the poverty line. Entry level police make 70k per year, and after 5 years it's 90k. Teachers, firefighters, nurses, also (The 4 areas I usually look at to determine "struggling lower end of middle class") make similar salaries. Baristas and fast food make $15 per hour (SeaTac just passed that law this past year, as national and state minimum wage levels are not survivable in the area. Not even if you worked 24 hours a day). $15 per hour is not a living wage, but it's a fighting chance with 2 jobs and room mates. To be solidly middle class in Seattle, one needs to be bringing home $100k-150k per year. Even so, you probably won't be sending your kids to private school ($25k per year k-8, 40k per year 9-12), and a week long annual vacation will require both luck and sacrifice.

This isn't to diminish the company-wide minimum wage! :) There is an incredibly steep divide between the have & have-nots in that city, and virtually no public services (the working poor are shafted, as there's not even enough money for food stamps for all the homeless & unemployed, much less the tens of thousands who qualify for assistance). What Gravity has done is to guarantee that all of its employees will be able to pay rent, utilities, eat, and get to/from work... Whilst only working 1 job, 40 hours per week! Which is rare, especially for the area. To give an idea... Low income & tiny subsidized student flats run about $1500 a month. Daycare (for 1 child!) is $1600 per month at the low end. Utilities average another $300-$500 (water prices double from Apr-October). A bus pass is $150 per month or more. So before you've even bought food? If you're a low income parent you can expect to have spent at least $3500 a month. Food costs, meanwhile, are on par with Hawaii & New England; with $8 per gallon of milk, $10 per pound for bologna ($12-$20 for better meat), $5 for a loaf of bread.

<grin> So it's great to hear of another company really going to bat to make sure that their employees are taken care of! I like this trend I'm seeing.

 

[moonbeam]

My first thought was that's awesome.

My second thought was: if you are an entry level worker that gets that bump up, it would then make it very difficult to leave. Because you would be making more than other entry level jobs in the area, and possibly even than jobs a step up. So if you got burned out of your job, you would have to continue on in misery or take a pay cut.

I mean I'm glad that they get a raise. That's all brilliant. Its just interesting to think how this might effect in other ways. Though probably says something that my second thoughts were about being miserable at work. :-/

 

[Go Hungry]

I can see both sides in this thread. From 2001 to 2003 I had a job that paid $11.24 an hour, which was considerably more back then than it is now. It was in a call center though, and its approach to employee relations could best be summed up as 'the beatings will continue until morale improves.' It was a terrible place to work, which enormous stress and pressure. It wasn't even the irate customers that were the problem. I mean, anybody can deal with a screaming asshate on the phone. But the strictures that one had to follow, the contradictory rules placed, wherein you were supposed to give every call your undivided attention, making sure that the customer left happy, no matter what (as long as it took under 3 minutes)... It was ridiculous, and I stayed at that job because of the pay, and only because of the pay.

So I can see where somebody who was miserable there would stay just for the money. And in my opinion, that is entirely their choice. I went on to a smaller check, but drastically less stress. It was the right way to go... My cats didn't like me being angry all the time.

Not that I'm bitter or anything. :p