You've just conflated having low performance with low bargaining power, which is weakly correlated at best. So... 1) Why pay less productive employees the same

You've just conflated having low performance with low bargaining power, which is weakly correlated at best. So... 1) Why pay less productive employees the same as more productive employees (for the same position)? Because it can be hard to measure performance, and harder to demonstrate to what degree the poor performance is direct responsibility of the employee. To some degree, it is laziness and/or sentimentalism from the employer; but if pursued to the ultimate consequences you may end up expending way more in your super perfect performance measuring infrastructure than what you will end up saving in payroll. It's way easier to turn a blind eye to small inefficiencies and firing actual slackers. 2) Why pay employees with low bargaining power as much as employees with high bargaining power for the same (or better) amount/quality of work? To some degree, every employer does this unless their workforce is unionized. The problem is, greed is an actual invariant in human nature and you do not want to live in a society that lets it run unchecked. It may be nice to save on payroll by low-balling your employees, but then it will be equally nice for Microsoft to send a horde of salesmen to hardcall your client database and offer them juicy cash incentives to drop your business and sign up for their free service... ... or for the matter, for Beaves and Butthead to try and invade your home and take as much of your property as they see fit.