Do you take this position when dining at a restaurant? When your food is amazing, do you pay more for it? When it's poor, do you pay less?

Probably not. If you care a lot about the restaurant's quality (maybe it's your neighborhood place), you might offer some constructive criticism in the form of yelp reviews or feedback cards. If that fails, you'd probably reluctantly sever your relationship with the restaurant.

Why should this kind of relationship not apply to employees? The only difference being an employer should probably do more to try to get performance up before severing the relationship.