Here's a story you may want to not-so-subtly pass on to your boss. With all the discussion recently about livable wages, CEO salaries and wage reform, one CEO has decided to take matters into his own hands - and business is booming.
Dan Price is the CEO of a credit card processing company called Gravity Payments. He made the news recently when he publicly announced his plan to raise the starting salary for his employees to $70,000 per year.
At first his employees were stunned.
But once they processed the news, they gave him a standing ovation.
Jose Garcia, an equipment supervisor making $33,000 a year before raise, says he cried when he told his mother about it.
Of course, a big change like this can't happen overnight. Salaries will increase periodically over the next two years. Effective immediately, everyone will get bumped up to at least $50,000 (or a $5,000 raise if they already made over $50,000).
Next year, they'll get bumped up to $60,000 and then finally $70,000 by 2017.
So how is Price going to afford all this? Though he's confident the long term profits will even out, for the time being he's slashed his own salary from $1 million per year to the same $70,000 as everyone else.
He was motivated by a Princeton study that showed that people have the highest emotional well-being at an income of around $75,000 a year.
So, a guy like Jose making $33,000 is going to have a huge spike in happiness at $70,000, but for someone making well over that amount, the added income does not add any extra benefits to emotional well-being. In fact, the added income can actually cause more stress. In the words of the immortal Notorious B.I.G., "Mo' money, mo' problems."
Price says the move has actually caused a noticeable spike in business. Morale within the company is also at an all-time high and applications are flying in at a staggering rate. Recently, the company posted two openings and received over 3,500 applications.
He realized that putting people over profits can still work out favorably.
Price is no stranger to success, though, having been named "Entrepreneur of the Year" by Entrepreneur Magazine in 2014.
Check out this CBS News report on his gutsy move: