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At my university, we are informed of our yearly raise with a letter mid-summer. There is no scheduled meetings with the chair or anyone else to discuss performance or the raise -- as far as I can tell, we just wait and see what it is. It tends to be a small cost-of-living raise in the range of 3%.
Should a pre-tenure assistant professor actively seek to meet with the chair and ask/negotiate for a larger raise, or is this not done in academia?
Should a pre-tenure assistant professor actively seek to meet with the chair
You should insist on meeting with your department chair at least once a year, if not once a semester, to discuss strengths and weaknesses in your evolving tenure case. Make no mistake—your tenure case started evolving the moment you signed your offer letter. If you are doing the right things to get tenure, you need to hear that. If you are missing something important, you need to hear that as well. Symmetrically, if you think things are going well, your chair needs to hear that, and if you think things are going badly, especially if something in the department is proving to be a burden, your chair needs to hear that, too.
and ask/negotiate for a larger raise
Oh, I suppose, if you have good pitch. You're not going to get a bigger raise just because you ask for it.
As in most fields, you only have so many negotiating "chips". You can spend these chips on whatever you want, but some things cost more chips than others. For example, a raise probably requires your chair to get approval from the dean and is therefore "expensive". Asking for some extra research/travel money is "cheap", especially if it is at the end of the fiscal year and there is extra money in the budget, since the chair likely controls that pot of money. Teaching load is often controlled by the chair, but does require someone else to pick up the slack so do cost some "chips". Basically you have to decide what you want and if you are willing to spend the chips to get it. What makes it difficult is knowing exactly how many chips something will cost.
It only makes real sense when you have a competing offer, which means you have been on the market this year, which means you are considering leaving, which means that the chair either knows this or will get to know this when you come to talk to them. It is unlikely that the chair will be excited to give a raise to the person who is going to leave, anyway. On top of that, as Daniel Shub put it, negotiating a salary increase means going at least one level up to ask for the extra money for the chair, and there should be a very good reason for this. Even if you just got the NSF Career award, the chair will just say, "Great, you now have the research money to support yourself -- congratulations! No salary increase, though".
Most likely, if you are going to complain about your pay being too low, you will hear a story about salary inversion, i.e., the tenured faculty in your department making less than you do, which is only justified a small fraction of the time for the deadwood faculty. So the priority will be to raise the non-deadwood inverted salaries -- these guys are here to stay -- and then address your concerns -- you are not here to stay yet, sorry -- subject to any remaining money. Having heard you complaining is not likely to make the chair want you to stay, either.
In a very rare event, you can come up with a scheme in which you bring the department more money, and then your request to see an extra cut of the pie may be legit. This could mean creating a new program/degree/track that is going to be the nations first program in interdisciplinary bubble sort or bean scouting or some other BS, but then it means that you are committing to a teaching track rather than a research track. If your research is stellar, and you want to diversify into teaching, that's probably OK; but most of the time proposals like that from a junior faculty will look weird and awkward.
As JeffE said, you MUST talk to your chair once in a while, and the annual review time is one of the best opportunities to do so. Your case was reviewed by the faculty not so long ago, so the memories of your file are reasonably fresh in the chair's head; it would be easier for them to connect the dots than it would be say in September when the new semester starts, with new students and new courses and all other hectic stuff happening in the department.
My feeling is that it should not hurt to ask, as long as you ask in the right way.
Negotiations are always tricky but having an open conversation with 'the boss' should always be a choice.
You might want to meet the chair with another issue and bring up the salary question as an additional point, as opposed to the main reason for the meeting. Also, approaching it as a question: You're looking to better understand school norms and who better than the chair to explain them to you.
