The crux of it is that you have designed a system which you feel can objectively quantify each individual's level of contribution, and then you are willing to d

The crux of it is that you have designed a system which you feel can objectively quantify each individual's level of contribution, and then you are willing to directly reward people based on that contribution. And I agree -- if you pull that off, and if you follow through with the reward, then it allows someone to take a lower starting salary, knowing that it is just a matter of time until things get back on the right track. But for many kinds of work, including software development, I've never seen anyone figure out how to quantify individual contributions directly (as Paul Graham talks about [1]). Maybe your company has fewer of those kinds of jobs. [1] http://www.paulgraham.com/wealth.html http://www.paulgraham.com/wealth.html