Price of publicity
The Villain: CEO who made salary sacrifice might just be after PR
What happens when the CEO of a little-known tech firm slashes his pay by 90% in order to provide a hefty blanket pay rise to his staff?
Increased productivity, improved loyalty and retention, a boost to the employer brand – all the usual things.
Oh, and great PR, of course.
Because since the Villain saw the news that Dan Price (who?), CEO of Gravity Payments (what?), had done exactly this, I’ve been more than a little cynical about the whole thing. Now, regular Villain readers will know cynicism isn’t something I tend to struggle with – and indeed, on this occasion it blurs into admiration for Price’s PR masterclass. But you get where I’m coming from.
The backstory is that Price decided to increase the salary of every employee at his Seattle firm to at least $70,000. And to fund it, he will be taking a 90% pay cut.
Price said he was driven to his decision by hearing of low-paid friends and their struggles with things like rent increases or unexpected bills, so he was compelled to introduce a new, much higher minimum wage at his company. Well done him, right?
But it’s not his decision, or the motives behind it, that are questionable. If the story is true, then it’s a noble act that will benefit the business and its people.
Instead, it’s the wall-to-wall media coverage that has resulted, which unsurprisingly arose from a loud, proud announcement from the company and its clearly media-savvy big cheese.
It’s the management equivalent of the oversized cardboard cheque – the well-worn method used by celebrities to tell as many people as possible about their charitable acts. You know how it goes – floundering pop stars unable to carry out the smallest act of goodwill without being accompanied by a photographer and their agent.
Well, there’s more than a whiff of that about Price’s move.
Smart move
Adding to my cynicism is the very significant small print in this deal. The roll-out of the $70k minimum wage won’t be complete until 2017. And in the fast-moving and fragile world of Seattle start-ups, the company might not even exist in its current form at that deadline, let alone the fact it almost certainly won’t be employing the same 70 staff.
So, potentially this could end up being a very empty promise indeed.
But right now, it’s obviously a smart move. It hitches a lift on the topical executive pay bandwagon and helps to portray Dan Price as a progressive, compassionate employer. If Gravity Payments wasn’t high on Seattle tech professionals’ list of top employers, then it might just be now.
There are other clues, too. Price’s father Ron is described as a ‘consultant and motivational speaker who has written a book on business leadership’. So, let’s be generous and say some of his dad’s business nous has rubbed off onto Junior. Or, let’s be less generous and say Dan Price has got ‘smart but potentially hollow business operator’ running through his DNA like the word ‘Blackpool’ through a stick of rock.
And finally – a tiny, mostly unreported aspect of the whole story that the Villain finds potentially the most nauseating part of all.
When asked how he would adjust to his 90% pay cut, Price replied: “I may have to scale back a little bit, but nothing I’m not willing to do – I’m single, I just have a dog.”
Don’t you see? This is all just a trumped-up personal ad. He’s a successful business owner. He’s generous to his staff. He loves dogs! But he doesn’t have that special someone…
Damn. We’ve all been had, haven’t we?
About the author
