It is against both logic and the game mechanics. Players don't lose quality when you get a promotion, it's an illusion =] Let me explain.
There're two "quality measuring units" linked to each other: percentage and overall quality (OQ). Like, 104% (41). 1 point of OQ always equals 4%, just believe me.
And there's a threshold. It is set on OQ=0 for a 1st level manager and goes up by 5 every time she or he gets a promotion (5 on lvl 2, 10 on lvl 3, 15 on lvl 4, etc.).
For example, let's look on a player in a lvl 4 team with quality 104% (41). The threshold for lvl 4 is 15.
41 - 15 = 26
26 * 4% = 104%
On the next level he will be 84% (41), because the threshold will be 20. But the OQ stays the same, 41. So if a player doesn't lose 20% that actually means he gains quality when you get a promotion. It would be strange, don't you think so?