Comment by VBprogrammer

That is one possible outcome. I'm not convinced it's the most likely outcome though. I guess it depends on how well correlated engineering talent is with negotiation skills.

Personally I wouldn't imagine those things are well correlated at all. In my experience the best engineers have stayed around long after it was obvious that they could get considerably more by changing jobs (and sometimes changing back again).

That aside, I think it would be entirely possible to set this up transparently enough that an engineer can see their future compensation and thus see how many years ahead they are jumping and can make their own judgement about whether it's worth moving to a company where their future compensation will likely change in the usual haphazard way.