Launched in 2004, Gravity Payments gained recognition in 2015 when Price set Gravity's minimum salary at $70,000 after reading a study about income and happiness.
Gravity Payments CEO Dan Price has come up with a solution to avoid layoffs in his company amid the massive disruption caused by the coronavirus outbreak.
According to a report in FastCompany, Price asked each employee how much of a pay cut they would be able to take for the next few months.
Based on the responses, the company now has enough reserves to keep everyone employed for a year under the current circumstances.
Launched in 2004, Gravity Payments gained recognition in 2015 when Price set Gravity's minimum salary at $70,000 after reading a study about income and happiness. The company processes payments for 13,000 small businesses across the country.
"Across all of our merchants, there was a 55 percent drop in revenue over the last month."That is a bigger decrease than during 9/11 and Great Recession," Price told Fast Company.
Price on March 19 called a company-wide meeting to let employees know the state of the business and solicit creative strategies for navigating the next few months. He along with Gravity COO Tammi Kroll also scheduled long meetings with small groups of employees to check in and gather ideas.
The company gave a form that allowed each employee to privately express how much cut they could afford. Each employee had some responsibility while some could afford to forego their entire salary."Some had family members who had just been laid off, some just had babies or bought houses. Even a 10 percent decrease for some families could pull the rug out from under them. But there were others who said they had a savings that could buffer them for several months," he said.
Today I cut my pay to $0. I'm committed to laying off 0 of our employees.
It's not much but it's what I can do. We'll get through this together.— Dan Price (@DanPriceSeattle) March 28, 2020
Many tech CEOs, including Salesforce CEO Marc Benioff, are calling for companies to keep employees on payroll, including hourly workers. Some companies, like Buzzfeed and GM, are temporarily cutting salaries rather than resorting to sackings.
Price said that many employees are sacrificing a financial buffer to ensure that Gravity stays in business, but there is still no guarantee.Follow our full coverage here