The expectation is that the salaried position is a 40 hr/wk position.
If you treat your employees only as a measurable commodity, entering into no acknowledgment of their worth, individuality, and personal potential, while attempting to mine every second of their time like a greedy, annoying crow, or worse, if you attempt to sit on those things and repress who they are, then your employees will not be loyal. This is inevitable.
When the first even nominally better opportunity (which might not even be better on grounds of pay, since everything else at your place sucks so bad) and they'll be gone. Because you made them hate you.
Which you deserved.
Sane employment is pleasant, goal seeking and reward-rich. For everyone. Not based on counting drops of sweat and screaming when the count is short. Balance liberty against compassion in tension as you encourage your employees to chase your goals and their goals. Otherwise you run the risk of just turning out to be considered another reviled prick.
I've run several very successful businesses. I'm not guessing here. Happy people do better work. Period.