As it is setup now players gain honor for playing even if they don't get honored if everyone is honoring someone. Additionally, you have people that are fairly toxic but not punishment level toxic that end up at Honor 5 despite being not really that honorable.
I think the honor system could be reworked a bit to work as follows.
-Gaining Honor is faster BUT requires more consistency.
-Losing Honor levels becomes possible without being punished first.
Why not tie it into the system better so that people that are consistently borderline or sometimes positive sometimes negative but not 'horrible' end up staying honor 2 or 3, indefinitely or even losing honor levels and checkpoints if they drop lower.
This would balance player honor levels so that people that are consistently truly honorable will be Honor 4+ while players that are more 'normal' would be around 2 to 3 as they either wouldn't progress or would drop slightly from being negative. People who are consistently negative would drop honor levels and would let them know that they are on the path to being chat restricted or banned.
This kind of a system would be a more reactive method to help people realize what behaviors they are doing is acceptable in the community.