A $70,000 “minimum wage.” What could go wrong?
You may recall the “heroic” CEO who took a pay cut and reduced profits to give starting employees at his payments company a $70,000 salary.
The CEO was trying to address income inequality. The initial feedback was overwhelmingly positive from employees, civic leaders and the general public.
But there were doubters. This feedback comes from a NYT article written at the time of the announcement:
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Sandi Krakowski, an author and Facebook marketing expert, posted on Twitter: “His mind-set will hurt everyone in the end. He’s young. He has a good intent, but wrong method.”
Patrick R. Rogers, an associate professor of strategic management at the School of Business and Economics at North Carolina A&T State University, wrote in an email: “The sad thing is that Mr. Price probably thinks happy workers are productive workers. However, there’s just no evidence that this is true. So he’ll improve happiness, only in the short term, and will not improve productivity. Which doesn’t bode well for his long-term viability as a firm.”