I think that the seniority system is a union-driven anachronism that does no one any good.
It increases costs for the airlines; and it ties in pilots who would be forced to start at the bottom of any seniority ladder at any new employer; rather than where they should be based on experience.
I can't think of any profession - and pilots clame to be professionals - that work on the seniority, LIFO system. Accountants? Nope. Dentists? Nope. Lawyers? You must be joking! Every one of those is promoted based solely on merit - not time served.
Nor should there be any 'seniority' pay. You do your job and you get paid for it. It shouldn't matter whether you have 20,000 hours and thirty years with a company as a captain on the latest Boeingbus A787 and the next guy has 6 months and 500 hours in command - you're both Captains on the same aircraft and you should be paid the same; and furthermore should have exactly the same bidding rights, which should be randomised.
Another serious problem is the conversion from right to left hand seat. Let's face it, in life there are leaders and there are followers. Some people are happy to remain an FO for life and I do not believe that they should be penalised - as they are at a number of airlines - for not being 'able' to advance to Captains. Let them be!
Experience does make a huge difference, though, and I would far rather have a highly experienced crew flying me than a relatively inexperienced Captain who has just been transitioned on from another type coupled with a CAP509 type who has just come in from the pool. Both might well be competent - indeed if they aren't they shouldn't be there in the first place - but would they be able to deal safely with an Azores-type situation? I frankly doubt it.
In situations like VS where an entire fleet is being grounded then sorry, but logically only those on that fleet should be laid off - regardless of how long they have been with the company. They can have a preferential position to come back into the company when hiring starts up again, but as seymore butts correctly says the practice of taking people off one type to replace them with people who need to be trained on that type from another fleet is ludicrous.