February is usually the time of year when sports fans across the world start chanting “Hum Baby” and turn their focus to America’s pastime. This year, instead of focusing on Spring Training, all of the attention is on another lockout that seemingly has no end in sight. The issues dividing the players and the MLB are plentiful and are somewhat complicated, so there’s a lot of work to do, and hopefully it can get done before games have to start being canceled.
Issues
First, before we dive into the core issues, it is important to note that this is a lockout, meaning, the Owners have locked the players out of their facilities and, if nothing changes, will eventually cancel games and the season. Players on the 40 man roster can’t have any contact with any team, they can’t use the team’s facilities, nor can they negotiate contracts or execute free agency deals. This is a tactic used by the MLB to put pressure on the Players Union in an attempt to get them to concede on the issues of disagreement. So far, the players haven’t conceded, and good for them!
Although Spring Training, and possibly the season is in jeopardy, the players, in my opinion, need to dig in and do what it takes to fix the core issues of their disagreement.
Free Agency Changes
Baseball has become more analytical which has led to it becoming younger as well. In the last decade or so the average age of a player in the MLB has dropped by a full year. So, to match that trend, the players want to move free agency eligibility down to 5 years of service time for players that are 29.5, and all players that have at least 6 years of service time. This request matches the youth trend of the league, so its not just fair, it’s based on fact. Currently, a player has to wait 6 years to become a free agent regardless of age which means that, many times, they are not negotiating at a stage in their career where they provide the most value. Obviously this system favors the owners so they would like to continue the status quo on this issue..
The players would like to have more control at younger ages and be able to cash in at their peak value, instead of having to wait until the end of their 6 years of service time. Clubs have wised up to paying the big contracts to guys in their 30’s, and on the other end they use tactics to suppress service time. For instance, clubs will keep players in the Minor Leagues for periods of time when they should be in the Major Leagues for no other reason other than to extend the amount of time it takes a player to reach their 6 years of service time. If an organization is not putting their best foot forward 100% of the time to win games, they are 100% being dishonest with the fans, and it needs to stop. Pronto! Tanking is not acceptable, and the players want to see it stopped because it is dishonest and it drives wages down. Also, by expanding the playoffs and making it easier to get in, teams will be able to pay less for players and still make the playoffs and profit from the playoff TV Revenue, which is woefully distributed in favor of the Owners.
Arbitration
After 3 years of service time, players become eligible for arbitration which means if they can’t come to an agreement on their contract, their case gets sent to independent arbiters to decide. Arbitration is a good thing, but doesn’t have near the impact that Free Agency does for players because it doesn’t provide for Free Market competition between clubs. The owners have proposed scrapping the whole process of arbitration in favor of an incentive based system that revolves around a set of Metrics. Analytics are a large reason why the gap has grown in terms of the revenue pie between players and owners, so, of course the players have rejected this idea,
Revenues
The MLB and the Owners try to give off the impression that they don’t make money through deceptive statements. Here’s an example from the Commissioner himself, Rob Manfred:
“If you look at the purchase price of franchises, the cash that’s put in during the period of ownership and then what they’ve sold for, historically, the return on those investments is below what you’d get in the stock market, what you’d expect to get in the stock market, with a lot more risk.”
I’m sure Manfred has a paper trail and an angle to a narrative that shows that this statement is not totally false, but, at the very minimum, it is wildly deceptive and completely out of context. The Owners are making money hand over fist as franchises have increased in value by over a billion dollars in the last 5 years, while players’ salaries have increased by just 1 percent. In fact, since 2017, player salaries have actually dropped and were down close to 5% this past year. So, in an effort to balance out the disparity in revenue sharing between owners and players, the players Union would like to see the Luxury tax raised. This is another request that is appropriate because it is based on the recent trend of franchise values increasing exponentially faster than player salaries. Owners are receiving larger percentages of the revenue pie, then wanting to keep player control issues at status quo.
Cup of Coffee
The issues of team control and dropping salaries aren’t the only issues. The players also want to protect the “cup of coffee” players and Minor Leaguers have to get paid better. Although there are a lot of Major Leaguers that make a lot of money, no question, the median salary is $1.25 million dollars, which, again, is a lot of money. But, consider, 1/4 of all Major League baseball players will only be in the Major Leagues for 1 year, and the average service time has dropped by over a year in the last 20 years.
Minor Leagues
Here is the pay scale for Minor League players. Class A $500 a week, Double-A $600 a week, and Triple-A $700, and that’s just during the season and they don’t get paid for Spring Training or the Instruct periods they spend after their seasons. So, most Minor Leaguers are making less than $15,000 a year, which means that, if that player has a family, they are making almost 1/2 of what the poverty level threshold is in the United States. And, although it has been agreed upon that housing is to be taken care of, it certainly has not been standardized, and, thus, still needs work, and in some cases, a lot of it.
