[Schema] 2.41 (userPassword) says:
The application SHOULD prepare textual strings used as passwords by transcoding them to Unicode, applying SASLprep [SASLprep], and encoding as UTF-8.
This is incompatible with passwords written in 8-bit character sets and stored encrypted in files that cannot easily be decrypted, e.g. Unix /etc/passwd files. Since the server does not know the plaintext passwords, it cannot prepare them as above.
Note that hashed passwords are non-standard anyway... ;-)
Ciao, Michael.