What Happens When Minimum Wage Jumps to $70,000

gravity payments

Gravity Payments, a payment processing company based in Seattle, made headlines this year after announcing that all 120 employees would make a salary of a least $70,000.

Dan Price, founder and CEO, made the decision after reading that hitting the $70,000 mark makes a monumental difference in quality of life. He funded the pay increase by cutting his own salary (from nearly $1 million a year to $70,000) and using 75 to 80 percent of the company’s anticipated $2.2 million profit for 2015.

I interviewed two female Gravity Payment employees about what it’s like to explicitly know what your colleagues make — and how they’re using that $70,000.

Stephanie Brooks, human resources assistant

How long you have been with the company?

I have been at Gravity for three months.

How has the $70,000 salary announcement impacted your day-to-day life both outside of work and at the company?

My life has been dramatically impacted. Outside of work I am able to pay off my student loans at a much faster rate. I have already finished paying off my car since the increase. I look toward saving for a home and having an emergency fund. I don't have to stress about using a credit card if something unexpected comes up. I go home from work and I don't think about the amount of money in my bank account, but rather how I can better prepare for work the next day.

At work I am able to look at things in a more long-term perspective. I feel secure in my role and that drives me to want to put in 110 percent in all my projects and tasks.

What's it like having total transparency surrounding salary at your job?

It makes the conversations with peers and supervisors much easier. There is no pressure to avoid having a conversation about compensation with a coworker. I doubt there are many companies out there where the topic of compensation is an open conversation.

Nydelis Ortiz, underwriting analyst

How long you have been with the company?

I began working for Gravity Payments in January of this year.

How has this change impacted your personal life?

After returning stateside from serving in the Peace Corps for 26 months, I moved to Seattle from Vermont in December and was struggling to make ends meet after not having earned an income for the last two and a half years. I grew up in a low-income household and have been financially independent since a young age. I was the first person in my family to go to college, but I incurred a significant amount of debt that I have been making the minimum payments on for several years.

When Dan announced that each Gravity employee would be receiving a minimum salary of $70,000 a year, it was a huge shock to everyone. To me, it meant reducing my loan payment time frame from 20 years to a realistic five years, being able to travel back to Vermont and Puerto Rico to see my family, paying off credit cards, having the ability to help my family financially, making more than both of my parents’ income combined, and not having to live paycheck to paycheck.

Outside of work, this raise has allowed me to focus my attention on things that are important to me, like community service and maintaining a healthy lifestyle.

What's it like having total transparency surrounding salary at your job?

It's strange that friends, family, and even strangers know exactly how much I make, but I think a lot of stress is generated from always wondering how much others in your company make or how other people's salaries compare to yours. Having transparency makes it feel like we're equals working together in a team, which I think is what it should be like.

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