Let me explain where i see a major problem in this.
The way that riot "detects" people reforming is entirely reliant on the community itself. If you're just an average bloke who doesnt get honored several times a game, you're absolutely, royally, fucked.
Several months ago i was chat penalized for a first-time offense. A grand total of 10 games of limited chat back in august i believe.
Since then, i've done my damnedest to try and avoid being the next tyler1, But i'm far from a shining paragon of the human race. I get frusterated, but i avoid taking anger out on fellow teammates. I've been "Honor Unlocked" since about a week or two after the flamefest i got penalized for.
To put into perspective what it was, i had just started jungling but even then i knew an important part of jungling was ganking lanes and helping teammates in fights. When i faced Lucian and Brand jungles, whom never ganked and flamed me for losing in a hard-countered lane.
So, i got pissed at them for playing poorly and not helping the team, so i flame em. Bad idea, but i was trying to get it through their thick skulls that we are humans, we dont play perfectly and we need help
3 months have passed and a new preseason, still honor 1 "unlocked".
Since being "reformed" is descided by the people you play with, and if they honor you or not, If you're stuck in a low ELO/MMR alongside people who tend to be more inflammatory (i.e mid bronze), you'll never climb OUT of low honor, so any 2nd offense is an instant demote to dishonorable.
2 minor penalties would screw you out of ranked. Minor penalties of which can be chalked up to human nature just being flawed.
So, let me just say that your idea should only work on people who have committed frequent and serious acts of toxicity, not just anyone labled dishonorable. Getting your 2nd and 3rd strikes get easier and easier as riot watches you more closely, trust me i've seen it happen myself.