First, employee don't want less money and fake it. Employers want the employee to be on site because they paid for it.

Second, society praises people for working. You will look better if say you are busy.

Third, our systems would collapse if people were actually paid to their real value. You would see the total unfairness of it, and also how truly brilliant or useless people are.

Fourth, laws, syndicates, medias and logistics come in the way. And with a big inertia.

Fifth, humans are not rational and don't do "the right thing" according to the intellectual or displayed objectives. And they have all their own agenda.

The other problem is that if you measured people purely by output, 10x developers (assuming you believe in such a concept) would be able to work 1/10th as much and would very visibly be missing much of the rest of the time. This would lead to a lot of resentment from people who are less productive and would be having it rubbed in their faces.

To get to a place where people are judged purely on output we would need to change society such that the notion of equality was essentially never mentioned or thought about at all. Because people's productivity is wildly, wildly unequal.