In business, employee behaviors and attitudes are sometimes put into three categories: actively engaged, (passively) disengaged, and actively disengaged. Actively engaged employees are the ones who do more than is asked of them and do their work well. Passively disengaged employees are those who do enough to get by, but no more, and not necessarily as well as they should. Actively disengaged employees undermine the company, actively avoiding doing their job and sometimes actively doing poor work.
A common goal is to engage the disengaged and get rid of or engage the actively disengaged. The problem is that many companies don't have a plan to keep the actively engaged employees. They take for granted that these employees will continue to do everything they can for the company and they try to track down the problems others have.
Unlike those running corporations, most of us can see where this leads. Your actively engaged employees are willing to put in a lot of effort, but when it seems they aren't getting recognized and, in many cases, the disengaged are getting extra benefits to entice them, they will become disillusioned. Actively engaged employees who don't quit often become actively disengaged employees. It's easy to take all the extra energy you've been wasting on the company and use it against the very same company.
Some especially problematic practices are time-based raises, such as those that schools are forced to use. Performance-based raises, of course, make some of the disengaged even more disengaged, since many of these folks will cry foul rather than putting in effort, but they're not going to be really engaged, anyway.
The worst thing to do is to allow your employees know that there is a moratorium on raises. People who know there is no benefit will have trouble justifying work. And when you tell them they can't get overtime, and make sure they get less than the allowed number of hours, you have to figure they'll have trouble doing extra if they wanted to.
But what do I know about business?