I have worked with people who have as many years of experience as me but are at a very different seniority level, for example by learning less (or more) in their prior jobs than I did.
If you were to hire them and me for a role where that difference is relevant (as it often is), we shouldn't be in the same seniority of job and shouldn't receive the same salary.
Yeah, even in that model, number of years of experience correlates only loosely with performance and with seniority in how someone thinks, communicates, leads, and produces.
Are you advocating ignoring those factors in how to compensate or internally promote, considering them only in the decisions of whether to hire into / fire from a given role?
If so that's not very common in the software industry and didn't seem to be what you were saying (I might have misunderstood).
I did once work at a startup with formula-based comp. However the "level" they used in that formula was intended to consider all of the above factors and was not a strict mapping to length of career.
If you were to hire them and me for a role where that difference is relevant (as it often is), we shouldn't be in the same seniority of job and shouldn't receive the same salary.