I said last week that I would not post on the CBA negotiations again until there was real progress. Well, here we go. Today the MLBPA and MLB agreed on a new five-year Collective Bargaining Agreement. Spring training will start ASAP. There will be a big flurry of free agent signings. The season will be 162 games and will start on April 7.
To recap this month’s events: Commissioner Manfred had set March 1 as a deadline to have a 162 game season if the players didn’t agree to a new CBA. The owners then made a “final, best” offer that was really no better than their previous offers except for conceding a more equitable minimum salary. The players rejected it and also scoffed at an arbitrary declaration of a shortened season…and made clear affecting pay and service time would be a no-go. Manfred declared the first week of games/first two series of the season cancelled. The two sides met some more this week. MLB declared yesterday a new final deadline…but stated in their ultimatum that failing to meet this one would preclude having a 162 game season and they really, really mean it. That, whether they realized it or not, put the lie to the March 1 deadline…and the new March 9 deadline. When no deal was agreed upon yesterday, Manfred cancelled the second week of games. Fortunately that declaration was met with a yawn as the players agreed to continue negotiations. Yesterday’s biggest sticking point was apparently whether the players would agree to an international draft, something the owners have long wanted. The players showed some flexibility on it today after retired player David Ortiz said such a draft was potentially doable. This afternoon the negotiating teams shook hands on a preliminary agreement. The players’ reps ratified it 26-12, and then the owners ratified it unanimously. Lockout over. Play ball!
Now, here’s the gist of the new deal:
1) The DH has now come to the NL, permanently. That was expected from the start. I personally liked the AL and NL being different, but c’est la vie.
2) There will be a draft lottery. It will involve the first six draft picks. It is intended to discourage tanking. It won’t, but whatever.
3) The minimum salary this year will be $700K, and will rise to $780K in the 5th year. For me, this is the most important gain by the players. Last year, baseball’s minimum salary was significantly lower than all the other major pro sports. Now it is at least above the NFL’s, in which it is important to remember only low draft picks/bench warmers/kickers get that minimum but in baseball young starters are among the minimum salary earners.
4) There will be a $50M bonus pool that will be split up among the best of the prearbitration players, bumping them above the minimum line on the salary based on performance. This, too, is a significant gain by the players. Harkening back to March 1, one of the reported impasses between the owners and players was the size of the bonus pool. The most the owners had offered was $25M. The lowest request from the MLBPA was $75M. The compromise final amount was obvious to the most casual observer.
5) The CBT (luxury tax) threshold this year will be $230M and rise to $244M in the final year. The starting amount is higher than the owners wanted to pay. The annual increases are less than the players wanted. It might also be pointed out this year’s NFL salary cap is just over $208M and both MLB and NFL rake in around $10B/year. Thus this seems reasonable. Make no mistake, the CBT is a soft salary cap.
6) The playoffs will be six teams per league. That will generate more national TV money. MLB originally wanted seven per league. The players balked—feeling that getting into the playoffs too easily would create a disincentive to spending by teams to get better. Thank you, players. 12 playoff teams will still mean generally only good teams get in. 14 teams would practically guarantee mediocre teams get in.
7) Eligible players cannot be optioned back to the minors more than five times a year. Fell free to call that a Rays rule, as some Rays pitchers have no doubt earned many, many frequent flyer miles shuttling between Durham, NC and Tampa Bay.
8) There will be, starting next year, a 45-day window to implement new rules in MLB instead of a year. The owners very much wanted this. Expect pitch clocks next year. Don’t complain, that really will improve the pace of the game. I will expound more later when this becomes reality. I am pro-pitch clock.
9) Rookies who finish in the top 2 of RoY Award voting in each league will be credited with a full year of service time even if they wouldn’t have otherwise. Also, teams that promote players from the minors at the start of the season, and see those players finish among top vote getters for RoY, MVP, Cy Young awards will be rewarded with extra draft picks. Service time manipulation will not become a thing of the past, but this might help.
10) Teams will be allowed to put an advertisement patch on the uniforms, and decals on the batting helmets. I’m told it won’t be excessive like NASCAR or European soccer, but it will be millions of dollars for the owners.
11) There isn’t an international draft, yet. The MLBPA has until July 25 to come to an agreement on one in exchange for eliminating draft pick forfeiture by teams that sign free agents given qualifying offers by their former team. I expect such an agreement to ultimately occur. There are actually some pro-player reasons for doing so other than the draft pick penalties.
Thus endeth the second longest work stoppage in Major League Baseball history at 99 days. Last week one of my friends asked me when I really thought this would end. I said this month—that it would be this week and find a way to get in 162 games…or later this month but then requiring the owners to give a full year of service time credit to everyone regardless of the shortened season. The reason I was pretty certain the owners would start making actual moves toward trying to make a deal is simple: if more than one month of games were lost, the owners would have owed rebates to the regional sports networks that televise the vast majority of the games. That regional network money is MLB’s most important revenue source. No way were they going to willingly jeopardize that.
So who “wins” this? The fans—we get our full share of games this year. Between the players and owners, both got some significant concessions. Kudos to the MLBPA for looking out for the young players this time. Overall it seems pretty fair, especially compared to the 2016 CBA. There is a caveat, though. The “middle class” free agents are still losers. Ditching draft pick penalties for signing some free agents will help, but they needed a salary floor. However, there is no salary floor here. Teams will still nontender or offer low dollar deals to vets in favor of younger, cheaper players. Prearbitration players will be making around $100M/year more, but I doubt that the overall percentage of revenue to the players will get to the roughly 50% their brethren in the other pro sports get. Time will tell.