In my ideal world, no they do not. Pay equals what it would cost to rehire me today. Performance should always be great for what you are expected to do.

Where the two correlate is that if you're hiring a mid-level person they get mid-level pay, and if they are top performing mid-level, they get promoted to senior and get commensurate pay.

So performance leads to promotions which leads to better pay. But pay is not directly correlated with performance. I expect everyone in the same level to have equal performance (over the long term, of course there will be short term variations).