I’ve worked for a half dozen software companies and they were all merit based and fired bad performers. They certainly weren’t perfect and mistakes were made, but as staff I perceived that pay was strongly correlated to performance and as management I worked to have pay correspond to performance and had access to data that demonstrated that.

I’ve worked for orgs where this wasn’t true and I avoid those orgs and prefer environments that are merit based.

I feel bad if people really have never experienced this as it’s really disheartening to work in an org where performance doesn’t matter. That must really suck.