Gravity Payments CEO Dan Price resigns amid assault allegations

Suspension

The Seattle CEO, who rose to national prominence for setting a $70,000 minimum salary for all of his employees — and a pay cut to match — has resigned from the company he founded during college amid accusations Misconduct and abuse.

Dan Price said he is stepping down from Gravity Payments, a credit card processing company, to devote more time to “fighting false allegations.”

“My number one priority is for our people to work with the best company in the world, but my presence is becoming a distraction here,” he wrote in an email to employees he also shared on Twitter on Wednesday night. “I also need to step down from these duties to focus full time on combating the false accusations against me,” he said, adding, “I am not going anywhere.”

Price did not elaborate on the allegations or respond to a request for comment on Thursday. But later that evening, the New York Times published a report alleging that the CEO had used his online fame to hide a “pattern of abuse in his personal life and hostile behavior at his company.” The report, which has not been independently verified by The Post, claimed that it stalked women online “who said he hurt them physically and emotionally”.

In a statement to The Times, Price said he “did not offend anyone physically or sexually,” and that “other accusations of inappropriate behavior toward the women in this story are simply false.”

Earlier this year, Price was charged with fourth-degree assault and reckless driving after prosecutors said he tried to kiss a woman in his car after a dinner meeting, according to the Seattle Times. When she refused, Price allegedly drove to a parking lot in North Seattle where he did “cakes” with her in the car.

His attorney pleaded not guilty in Seattle Municipal Court in May.

A frequent critic of corporate executives and the vast pay gap between them and their workers, Price won national acclaim in 2015 after announcing that he would raise the salary of each employee to at least $70,000. At the time, his 120 employees were making an average of $48,000 a year, according to The Times.

The report added that he also reduced his $1 million compensation to that floor, cutting wages by more than 90 percent, and used nearly three-quarters of that year’s earnings to cover higher wages. Price said at the time that he would keep his salary low until the earnings were recovered.

Often the price turned into Social media to promote the success of his company’s model. His Twitter posts are cheerful, unlike the often vulgar posts of business executives, offering his 770,000 online followers a personal mix of labor activist and work-life balance influencer. It often heralds fair presidents and corporations. He noticed that the minimum wage for Gravity workers is now $80,000, and the company shows it Unlimited paid leave. He said that job opportunities usually attract more than 300 applicants.

Before announcing the resignation, he tweeted about the layoffs, declaring: “A really good CEO would never lay off workers.”

The original minimum salary was set in the same year that Price won a legal battle against his brother Lucas Price. A three-week court battle ensued after Lucas Price claimed his rights as a minority shareholder were violated when Dan Price raised his salary. King County Court opposed, and ordered Lucas Price to pay his brother’s legal fees, totaling $1.3 million.

Price’s image rose at a time when a broader conversation was raging about pay inequality and economic inequality, with American companies and their highly paid CEOs often bearing the brunt of the criticism.

In 2015, the year Price cut his salary, the nation’s chief executives were collecting 276 times the annual wage of the average worker, according to the Economic Policy Institute. A 2021 analysis found that the gap widened to 351 times as large as the average worker. CEO compensation has risen about 1,300 percent in the past four decades, after adjusting for inflation. The study found that the median pay of top business leaders in the nation’s 350 largest companies was $24.2 million in 2020, when the realized value of stock options is taken into account.

Meanwhile, the federal minimum wage has remained unchanged since 2009, at $7.25 an hour. Although some state governments have taken the lead in raising the minimum to $15.

Price was 19 when he started Gravity Payments in 2004 from his dorm room at Seattle Pacific University, using seed money from Lucas Price, according to the Times. The 38-year-old has authored a 2020 book, Worth It: How the $1 Million Pay Cut and $70,000 Minimum Wage Revealed a Better Way to Do Business. That same year, he wrote a perspective piece for The Post, defending his company’s treatment of workers as a model that allowed employees to determine how to respond to economic shocks during the early months of the pandemic.

He also wrote that 98% of Gravity Payments employees volunteered to temporarily cut their salaries from 5 to 100% to avoid layoffs. On Wednesday, Price said the company has never laid off a single employee in its 18-year history.

Tammy Kroll, the company’s chief operating officer, took over as CEO. “The company supports his decision to step down,” it said in a statement.

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