​CEO to employees: $70,000 is our new minimum wage

Dan Price, CEO of Seattle-based credit card processing company Gravity Payments, made a stunning announcement during his company's quarterly meeting.

"We're gonna have a minimum $70,000 pay grade for everyone that works here," announced Price.

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Dan Price, CEO of Gravity Payments CBS News

As Price explained that minimum salaries would jump to $50,000 immediately, and $70,000 within three years , his 120 employees sat in stunned silence before bursting into applause and giving their boss a standing ovation.

For 29-year-old Jose Garcia, a deployment supervisor with $54,000 in student debt, his $33,000 salary jumps to $50,000 immediately.

"Maybe I cried when I called my mom," said Garcia. "I think it's life changing for everybody in different ways."

Garcia says he describes Price to friends as, "the guy that owns the company I work with, not the guy that owns the company that I work for."

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Jose Garcia, an employee of Gravity Payments CBS News

Price says he was inspired by a Princeton study that showed emotional well being rises as incomes rises, up to $75,000.

"So I realized that people making less than that, there's an emotional cost every single day. And you only get to live once," said Price.

Price, who was named Entrepreneur Magazine's 2014 Entrepreneur of the Year, says the move will cut his company's profits almost in half for now. To cushion the blow he's slashed his own million dollar paycheck to $70,000.

"You know I want to be part of the solution to inequality in this country," said Price. And if corporate America also wants to be part of the solution that would make me happy. What matters to me is that the problem gets solved."

Word about Dan Price's gesture has quickly spread. Tuesday alone, Gravity Payments received 535 new resumes.

  • Anthony Mason
    Anthony Mason

    CBS News senior business and economics correspondent; Co-host, "CBS This Morning: Saturday"