I think the thinking behind annual raises is to retain employees. Cheaper to pay this than to find/train/retain new hires.
That said, I am a firm believer in pay based on value returned to the employer, which is always a variable, thus a negotiable. Even with commissions, the structure is a moving target.
Now if you want to get into an argument with a public sector person, mention a performance base pay scale or a voucher system for educators. Smile.
