Well, combat experience isn't everything in most military. Non-commissioned officers (ex.: Sergeants) will often have more experience than their officer (ex.: Lieutenants) who come out of school at a later time in life, since the sergeant might have risen through the ranks and started earlier (for same age officers).
It's just that getting a mechanic that increases costs (especially in early Piratez when money is scarce) without much benefits (presumably the morale boost is similar to the risk of a big morale drop if killed) will just lead to firing of the newly promoted average soldier. I am not looking for yet more reasons to fire soldiers (too expensive for his worth, on top of too low starting stats, too low psi strength, too low something else or other).
So this mechanic only makes sense if it increases costs for retaining great soldiers, not just random rookie 11 who happened to be lucky and get the first kill, and being the first sergeant, is the only one ready to be promoted captain, then the only one ready to be promoted commander, even though he didn't do much except score the first kill.