gravity payments salary case study

7/25/2019 Gravity Payments Salary Case study

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Case:

Gravity PaymentsFloor Salary

"GexislittlbeliAmis w


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ntroduction

Founded in !#

Private Com$any

C%& and Founder: 'an Price

ndustry Sector: (an)ing *Finance

+umber of em$loyees: about,

Product: Credit card $rocessing

-evenue: ,/ 0illion 1!,#2

Pro3t: !.! 0illion 1!,#2


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Case

!,/: C%& 'an Price decided to change the $olic

Floor salary of 45 for all em$loyees by !,

Some em$loyees reached a doubled salary

All em$loyees with a salary over 4) didn6t get increasing

Price6s idea came from a study by Angus 'eaton 7ahneman

8hreat that em$loyees are facing in terms of longmotivation


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9hy did'an Pricechange the

$olicy

C%& tried to im$rove life of em$loyees

8he Princeton article made reali;ed that there wasa motivational $roblem with the em$loyeesbecause they were not being $aid near these45 minimum

(asic needs of all em$loyees should be covered1see 0aslow25 res$ectively hygiene factors 1seethey wor) more e?ciently


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Positive%>ects

Pro3ts has been doubled since the announceme

Customer retention rate grows from @, to @/

er vecom$etitive com$ensation $ac)ages that allowem$loyees to maintain a higher standard of livi


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+egative%>ects

Short term sacri3ce

Some clients were u$set by the $olitical message thindicates and feared that $rices would increase

Shac)les high $erformers to less motivated em$loy

Former em$loyees are not ha$$y with income distri

'ue to high salary hi)e5 their own $ro3t of !.!0 wdedicated to the salary increases

Com$any more charity than $ro3t orientated B baat 9all Street


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+egative%>ects


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%uity 8heory

%m$loyees who were very ex$erienced were unhtheir salaries were not increased as much as thosex$erience.

Some entry level em$loyees feel that they have nthe raises they have been given.

8he $erformance of em$loyees increase based on$erce$tion of euality among the em$loyees and

Conclusion


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%uity 8heory

8he euality measure comes about how much exe>ort and s)ills you have related to the salary5 rebene3ts the com$any gives to em$loyees.

8his $olicy change is disru$ting the normal hierarem$loyees are ha$$y for now with their raises5 inem$loyees will be frustrated as the foundations otheory states this.

Conclusion


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ered by Gravity Payments is above standard.

%ven before the $olicy5 hygiene factors of the embeing met and $olicy change caused strain on emsatisfaction.


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-ecommendation

8he minimum salary should reach the 45 butto get this amount will de$end on your $erforman

Gravity Payments should introduce a graduated $aallows em$loyees to uic)ly move u$ the salary laearn ex$erience.

8he new minimum salary can be a $romise within amount of time and allows the em$loyee to earn tcom$ensation without u$setting more ex$erienced


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-ecommendation

%very single Iob $osition $erformance should be mcorrectly and eventually the salary risen to 45

&nce on the 45 according to the euity theor

Payments should include a bonus to ma)e sure thecontribute the more bene3t you get.


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Juestions

gravity payments salary case study

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