[mrfredward]

The downside of seniority based pay is that people who show little to no motivation can end up the highest paid on a team if they simply avoid getting in trouble for 20 years.

I know someone who quit a job at Boeing years ago in part because he was at the bottom of the pay ladder doing tons of work while the highest paid non-manager in his department didn't do anything except keep the printers stocked with paper.

Throwing incentives on competitive people can be toxic, but the opposite problem is that when high performers don't get rewarded the organization will rot.