It's a good deal for management, and exploits the fact that most pilots will do just about anything for more money. Using your example, take an FO at JetBlue making $101/hour. He has a 72 hour line, and decides to pick up open time to 88 hours to chase the premium pay. His effective hourly rate for the 88 hours becomes $106.74, or about 5.7% more.
But the company got 22% more work out of him.