Anyone sensing momentum in baseball’s collective bargaining negotiations needs to take a deep breath. League and player representatives continue to hold much different views of the game’s economics. The scheduled start of spring training in mid-February is clearly in jeopardy. In another few weeks, Opening Day on March 31 would be a longshot, too.
As the owners’ lockout drags into its third month, the essence of the problem is this:
Major League Baseball contends it is proposing a better deal for players than the one they had under the most recent collective bargaining agreement. And the Players Association contends that the deal is worse.
The acceleration of talks is hardly out of the question; in labor negotiations, it’s always darkest before the dawn. But Scott Boras, the game’s most prominent agent, said the players are dug in not only because their
salaries are declining, but also because franchise values, even as profits have fallen during the COVID-19 pandemic, continue to soar.
Since 2002, all four of the major U.S. sports leagues have performed better than the S&P 500 companies on the stock market,
according to Pitchbook. The return on MLB franchises was 669 percent, above the
NFL’s 558 percent and exceeded only by the
NBA’s 1,057 percent.
“History has told a story that the players now understand,” Boras said. “And the history is that, what you negotiate from is appreciation of franchise values and revenue increases . . . From the players’ perspective, it is about how successful this game is from those two perspectives. And they want fairness. Players want fairness in the success of the game.”
The owners historically have pushed back on the relevance of franchise values in labor negotiations, saying they base payrolls on revenues and not the potential resale values of their clubs. But even putting franchise values aside, the players remain dissatisfied with their share of the revenues, and frustrated in their belief that the owners’ latest proposals will not do enough to improve their overall standing.
A breakdown of the most contentious issues in the negotiations reveals just how far apart the two sides are:
Minimum salary
The minimum is no small matter in baseball, affecting a sizable number of players as the league skews younger. As
Travis Sawchik wrotein November, 571 players (63.2 percent of all MLB players in 2019, the last season in which complete full-season data was available) had between zero and three years of service. All but the Super Twos — the 22 percent of two-plus players who qualified for arbitration — were essentially bound to salaries at the minimum or slightly above.
The players have proposed increasing the minimum from $570,500 to $775,000. The owners have proposed that the players will earn $615,000 in their first year, $650,000 in their second and $700,000 in their third. The increase of $44,500 for first-year players would be the largest they have ever received, and $27,500 more than the amount the union negotiated for them in the 2016 CBA. But the union notes the boost is barely above a cost-of-living increase.
One other thing about the minimums under the league’s proposal: Teams could not exceed the set amounts by using their own formulas to reward top performers the way they have in the past.
The union views the capped figures, coupled with the increases, as an example of the league giving the players something with one hand and taking something else away with the other. The league believes the point is irrelevant, saying the increases in the minimums, combined with the additional money top performers could earn in the bonus pool, would leave every 0-to-3 player better off than he was under the previous CBA.
Arbitration and pre-arb bonus pools
The argument begins with arbitration eligibility, one of three core items the league said it would not negotiate. The players made moves on the other two elements last week, dropping their desire for earlier free agency and modifying their request on revenue sharing. The league, meanwhile, agreed to the union’s concept for a bonus pool for pre-arbitration players, with the size of the pool to be negotiated.
That is where the progress ended.
The players want arbitration eligibility to start at two years of service. The owners want to keep it at three. A potential compromise — increasing the number of second-year players eligible for arbitration — is out of the question from the league’s perspective.
In November,
the league proposed to eliminate arbitration, establish a predetermined pool for 3-to-6 year players and pay them according to performance, as calculated by fWAR. The union wanted no part of a set scale that would leave no room for negotiation, and the league relented on the idea last week, saying it was willing to keep arbitration intact. The players, unhappy with the status quo, hardly see that as a win. Which brings us to the pre-arb bonus pool.
The difference in the amounts proposed for the pool — $10 million by the owners, $105 million by the players — actually is greater than those numbers suggest. The league would make its $10 million available to all 0-to-3 players except the Super Twos who are eligible for arbitration. The union, on the other hand, based its plan on players becoming eligible for arbitration after two years. Thus, the $105 million it requested would go only to 0-to-2 players, a much smaller group.
The proposals, then, are not quite comparable. The league, though, says it is making a significant move merely by accepting the union’s idea for the pool, which would be a first for MLB, rewarding top young players whose earnings are otherwise restricted.
Under the league’s plan, the salary of
Corbin Burnes, a two-plus player in 2021, would have jumped from $608,000 to $2.34 million, based on his Cy Young Award and WAR. A number of other 0-to-3 stars —
Vladimir Guerrero Jr., NL Rookie of the Year Jonathan India, AL Rookie of the Year
Randy Arozarena — also would have received boosts. But the union wants much more money going to young players than the league is currently offering.
The amount of money in the pool should be negotiable contingent on other elements in the deal. But for now, arbitration eligibility remains a point of contention. Perhaps a
robust pre-arb pool would persuade the players to be more accepting of the status quo, and keep eligibility at three years.