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This CEO Is Giving His Employees' A $70,000 Minimum Wage

Dan Price's salary went from nearly $1 million a year to $70,000 so he could raise the starting minimum wage at his company, Gravity Payments.

Posted on April 15, 2015, at 12:02 p.m. ET

This is Dan Price, the CEO of Gravity Payments, a Seattle-based payment processing company. After reading an article on how income affects happiness, Price decided to do something for his workers.

Entrepreneur / Via

On Monday, Price announced to his 120 employees that the new minimum starting salary at Gravity Payments would be $70,000 per year, the New York Times reported.

The announcement directly affects 70 workers, with some even seeing their salaries nearly double. Before the announcement the starting salary at Gravity was $48,000 a year.

A lot of the raises will come directly from the money taken out of Prices' salary, which was about $1 million and is now also going to be $70,000 a year.

This move is unprecedented, as the average CEO in the United States reportedly makes over 300 times what the average worker makes.

"The market rate for me as a CEO compared to a regular person is ridiculous, it's absurd," Price told the Times.

He added to the Huffington Post, I'd been thinking about this stuff and just thought, it's time. I can't go another day without doing something about this."

BuzzFeed News has reached out to Price for comment.

The 30-year-old Price said that he would have to cut back his personal spending to make the adjustment.

"There will be sacrifices," he told the Huffington Post, "but once the company's profit is back to the $2.2 million level, my pay will go back. So that's good motivation."

He said he lives a modest life for a CEO and still drives a 12-year-old Audi, but may spurge on picking up a bar tab occasionally.

He said another motivating factor was hearing how people were barely getting by.

Gravity / Via

"They were walking me through the math of making 40 grand a year," he told the Times. "That just eats at me inside. As much as I'm a capitalist, there is nothing in the market that is making me do it."

Price sees the pay cut as a smart business move, because higher paid and happier employees will be more motivated and work harder.

Entrepreneur / Via

β€œThis is a capitalist solution to a social problem. I think it pays for itself, I really do,” he said.