It's hard to take this post serious??? There are soooo many reasons not to do that. I can assume you don't live in the valley or anywhere there is a shortage of developers.

Biggest one:

More expensive for the company initially and way less secure. Talk about telegraphing to your competition what it would take to poach your top employees!

You would end up with 80% of your staff believing they were underpaid (even if that was not even close to true--perspective is reality)