When a business expands sufficiently to require workers it becomes a contract between a worker selling his labor and an employer buying that labor. It is no different than selling matchsticks that the employee made in his kitchen. It is negotiation based on what the unit of labor provides and what the business owner needs. That's where it should stay.
Indeed, but valuable workers should be rewarded. When I managed a kennel I was in charge of hiring people, but I could not give raises. That was up to the owner. As a result people would work there a maximum of 6 months and then quit for jobs they felt had a better chance of rewarding them. A good way to incur the owner's wrath was to ask for a raise. She'd find a reason to get rid of you then. It was very bad for morale.
Finally I convinced her to begin properly rewarding good employees. It was small, the highest I ever saw her go at one time was 35 cents, but it sent a message to the employee that we appreciated their contributions. As a result people stayed longer and we were able to really streamline the operation.
She never admitted it, but I could tell that she knew giving raises and paying people a living wage made her company better off in the long run.