Progressive Seattle CEO Who Raised Minimum Salary to $70k Faces Predictable Woes


Dan Prices massive, self inflicted pay-cut has hurt.  “I’m working as hard as I ever worked to make it work,” he told the Times in a video that shows him sitting on a plastic bucket in the garage of his house. “I’m renting out my house right now to try and make ends meet myself.”  Running a business requires sacrifice, but will this pay raise for his employees be too much of a sacrifice and destroy his company?

Since the announcement three months ago, he has lost a few top clients, who were fearful that their rates would go up.  Many of these clients are Seattle based companies, who are also facing mandatory minimum wage hikes to $15 an hour.  According to the Times interview,

“More troubling, a few customers, dismayed by what they viewed as a political statement, withdrew their business. Others, anticipating a fee increase — despite repeated assurances to the contrary — also left. While dozens of new clients, inspired by Mr. Price’s announcement, were signing up, those accounts will not start paying off for at least another year.”

Dan Price said he was pained to hear Brian Canlis, co-owner of a family restaurant,

“…already worried about how to deal with Seattle’s new minimum wage, told Price the pay raise at Gravity “makes it harder for the rest of us.”

“It pains me to hear Brian Canlis say that,” Price said. “The last think I would ever want to do is make a client feel uncomfortable.”

The cost of doing business requires flexibility, risk, and creativity.  A few of Price's most valued employees left due this pay increase.   Gravity financial manager Maisey McMaster, 26, told the Times.”He gave raises to people who have the least skills and are the least equipped to do the job, and the ones who were taking on the most didn’t get much of a bump.”

Grant Moran, 29, another employee who quit, said “the new pay-scale was disconcerting”

“Now the people who were just clocking in and out were making the same as me,” he told the paper. “It shackles high performers to less motivated team members.”

Price has had critics from all walks of life, including Rush Limbaugh who saw this as a socialist agenda.  Price told his interviewer that  “McMaster and Moran, or even critic Rush Limbaugh, the talk show host, were not wrong.”

“There’s no perfect way to do this and no way to handle complex workplace issues that doesn’t have any downsides or trade-offs,” he said.

Read more about Price paying the price of doing business here.


Photo: Ronald Woan on Flickr



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