Rather than low-level units being huge cowards and high-level units being unfeeling robots who know no fear, I think the morale system should be a more gradual curve.
How morale with tier works now
* T0-T1 units very easily chain-rout after about 10% of their force dies.
* T3-T6 units almost never rout regardless of what happens.
How morale with tier should work
* T1-T2 units (looters, new soldiers, etc) rout if
any two of the following things happen: their morale before the battle is less than high, or their commander's leadership is less than high, or their commander is downed, or they get flank attacked, or get charged by higher tier enemies, or their formation takes a small amount of casualties quickly, or the non-routed enemy currently outnumbers their non-routed army by 2-4x or more.
So to apply this system to OP's example, where he killed 2 looters and 11 ran away:
* If he killed 8 looters but took 8 casualties of his own, the remaining 5 looters would fight to the death.
* If he killed 8 looters, with no casualties, in a short period of time, the remaining 5 looters would rout. (Outnumbered + quick kills).
* If he brought T2 troops instead and killed 8 looters, the remaining 5 looters would rout. (Outnumbered + charged by higher tier).
* T3-T4 units (regular soldiers) rout if
any three of the following things happen: their morale before the battle is less than normal, or their commander's leadership is less than normal, or their commander is downed, or they get flank attacked, or get charged by higher tier enemies, or their formation takes a medium amount of casualties quickly, or the non-routed enemy currently outnumbers their non-routed army by 6-8x or more.
* T5-6 units (veterans and elites) will rout if
any four of the following things happen: their pre-battle morale is at the lowest, or their commander has very low leadership, or they get flank attacked, or their formation takes high casualties quickly, or their commander is downed, or the non-routed enemy currently outnumbers their non-routed army
by 10-12x or more. This would be behaviour appropriate of a well-trained elite corps who will fight loyally to the death for the cause of a leader they believe in, but will not fight suicidally if they have no reason for it.
* T0.5 - equivalent units (
farmers and other noncombatants) should always rout if they get flank attacked, or get charged by higher tier enemies, or their formation takes casualties quickly, or the combat ready enemy currently outnumbers their non-routed army by 1.5x or more. Non-combatants running away very early in a battle makes sense.
And on top of all this, obviously commander proximity, leadership, enemy deaths, taking damage etc. have a small positive or negative impact too.
So let's say you're commanding a mixed army of T1 and T6 against a similar enemy force, and you have normal morale and leadership, and the enemy T6 charges your T1. The T1 will break and run without putting up a fight. But your T6 troops will fight to the end, even though they are outnumbered. You can use them to charge the enemy's T1 in turn and rout them.
