Why should those of us that stick around in games with people who leave receive a loss penalty? Its completely insane..

I wanted to take this opportunity to briefly explain some of the systems we have in place regarding leaves and losses in competitive play, and why they're there and why they work the way they do.

When we determine someone has quit a competitive match before the first 30 seconds of game time has completed, we note that the match is now invalid and it collapses after 30 seconds. The person who left receives BOTH a loss and a leave, while everyone else can then leave without penalty or loss.

After the first 30 seconds of game time, how we handle someone leaving a competitive match changes. After determining that someone has quit, we begin a 1 minute timer. The missing player can return during that timer, but if they do not then the remaining team members are now given a choice. Depending on the match situation when the player left, that team might want to play on since they still have a chance to win. If the situation is hopeless, we don't want to force players to stick around while the other team finishes the match. So we allow the rest of the team to quit the match without a leave penalty, but they still do receive a loss.

Why do the remaining team members still receive a loss? How is this fair? The unfortunate answer is that the alternative would be worse. We don't want to create an awful situation where players who think they're losing are now encouraged to do whatever it takes to get someone else on their team to leave. By removing any possible incentive for anyone to "tactically" leave, it also means that more matches will complete normally. When someone leaves, Overwatch is less fun to play for everyone.

To further discourage someone from leaving a match, competitive play has a different leave penalty system than a quick play game. Leaving won't simply reduce your XP gain, instead you can be suspended from playing competitive play. The time a player is suspended time increases on repeated leaves, and in extreme cases a player will earn a ban from competitive play for the current season. Banned players also forfeit any rewards granted at the end of the season.

Parts of Scott Mercer's explanation are outdated. Matches now cancel after one minute of game time (this is counted from the time when the attack spawn doors open in the starting round). Furthermore, the timer for a leaver to return to a main Competitive Game was increased from 1 minute to 2 minutes. The time to return to an arcade Competitive mode is only 15 seconds.

Furthermore, changes are now being observed by the community that early leaver cancellations are now determined based on whether the leaver participated in the match in any capacity (but this has not been confirmed by the development team).