Seattle CEO Cuts His Own Pay To Give Workers $70,000 Minimum Wage Amid Fight Over Income Inequality
SEATTLE (CBS SF) — While fast food workers across the country and San Francisco are demanding restaurant chains pay a minimum wage that would earn them $28,000 a year, one Seattle CEO is taking matters into his own hands in the fight over income inequality.
Dan Price of Gravity Payments, a Seattle-based company that processes credit card payments, told his employees this week that he was taking a pay cut so they would earn a base salary of $70,000, to be phased in over three years.
During a company meeting, he said his pay cut is worth it to make the company's more than 100 employees happy and to build loyalty.
"I think this is just what everyone deserves," Price told workers.
Earlier this month, Seattle's minimum wage law went into effect, which will eventually raise base hourly pay to $15. It's phased in more quickly for big companies than small ones: Large businesses and national chains had to raise their minimum wage to at least $11 an hour when the law took effect April 1, while smaller businesses now must pay at least $10.
San Francisco is the second city, joining Seattle, to have the highest minimum wage in the country. The incremental increase will reach $15 an hour in 2018. Oakland passed their own minimum wage increase that set theirs at $12.25 an hour in March. Richmond also voted to phase in an increase to $13 by 2018.
Despite efforts to level the playing field, San Francisco has one of the most unequal distribution of incomes in the United States, according a recent Brookings Institution study.
While $15 an hour for fast food workers make a significant difference in most parts of the country, the pay raise would make little difference in the Bay Area.
An average one bedroom apartment in San Francisco costs $3,120 -- that's over $37,000 a year. So even if protesting workers got their way, living in San Francisco, or most other parts of the Bay Area, is nearly impossible on a $28,000 salary.
But that didn't stop dozens of people from flooding a McDonald's in San Francisco with megaphones and posters Wednesday morning to make their demands heard anyway.
TM and © Copyright 2015 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2015 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten. The Associated Press contributed to this report.