My last company would insist that they couldn’t give promotions or significant raises. Until you came in with an outside offer, then they’d roll out the red carpet and bend over backwards to keep you.

It breeds distrust, discontent, and disloyalty.

The best people don’t like this and leave. They company is left with people who can’t land outside offers. And the company ends up needing to pay market rate anyway to replace the good people who left.

Idiotic.