Dive Brief:
- Pay equity issues from the C-suite all the way down to the lowest-paid workers are gaining momentum in the U.S., according to a recent article on Chief Executive.net.
- Investment and political activists continue to target CEOs, business owners and companies that seem vulnerable on the issue of the CEO-Employee pay gap.
- A Seattle business owner recently announced that he would cut his own pay and profits to make it possible to raise the minimum wage at his company to $70,000 a year.
Dive Insight:
According to the article posted by contributor Dale Buss, the CEO pay gap issue has been gaining traction, but not everyone believes it makes sense. It got some recent press when Dan Price, CEO of Gravity Payments, a credit-card processing company, slashed his own $1-million salary to the $70,000 level, arguing that the new salary structure would benefit his firm in the long run even as it would help highlight the effects of income equality on American society.
Some voiced their concern that while it made great headlines, it won't necessarily make employees more productive.
For example, an associate professor of strategic management at North Carolina A&T State University, Patrick R. Rogers, wrote to The New York Times 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."
