Proposals for MLB’s next collective bargaining agreement

In Part One of this two part series, we dug into the possibility of the Major league players possibly accepting a salary cap, and why that is not likely to happen any time soon. And yet, the problems that players have with the current collective bargaining agreement (CBA) include the fact that clubs are taking in increasing revenues while player salaries are not keeping pace. Players want a greater share of revenues, but not revenue sharing.

Players’ concerns:

• Slow growth in player salaries vs MLB revenues
• Service time manipulation by teams to delay free agency or arbitration eligibility
• Teams deliberately tanking, not spending on player salaries, even as some are receiving funds from revenue sharing
• Players finally reaching free agency after six years of depressed market salaries and not being able to get a contract
• A growing gap between the highest and lowest paid players and teams moving to more cost controlled players

The owners have done pretty well in the last two rounds of bargaining. They would still like to implement an international draft, and Commissioner Rob Manfred doesn’t give up anything without getting something back.

The owners’ proposals made to the players this year contained elements most favorable to those at the lower end of the pay scale while the initial proposal for a sliding pay scale would have paid salaries above $20 million at the rate of 10 cents on the dollar. This was a clear attempt to split the union by proposing terms that appeal to the majority of players while taking from the fattest contracts held by a privileged few. It didn’t fly, but we can expect more of that.

With all of this in mind, here are some proposals for the next round of CBA talks:

Perks for MLB owners:

• Increase the salary cap tax threshold from $210 million to $250 million, and impose a dollar for dollar tax on the overage.
• Repeat offenders lose a second round pick the second consecutive time above the threshold, and a first round pick every time over thereafter.
• Limit free agent contracts to five years, except a team can sign it’s own player that they’ve had for at least two seasons to a six year extension.
• 50 percent of local revenues go to revenue sharing, split 32 ways
• Non market disqualified teams (the 16 smallest markets) keep their gate receipts
• Players agree to wear advertising patches on uniforms starting in 2022
• If the agreement is made in time, players agree to drop their grievance re 2022 bargaining

Perks for the players.

• The minimum salary increases from $563,500 to $600,000 in 2022, then up by $100,000 per season to $1 million in 2026
• A dollar for dollar tax will be imposed on any team payrolls below $125 million. Payrolls for this purpose include major league salaries only. No minor league salaries or benefits.
• Super 2 arbitration eligibility is reduced to 2.5 seasons, down from about 2.66 to 2.77
• Service time will not be manipulated for financial reasons, subject to grievance procedures.
• Players unsigned with 5 years service time may become restricted free agents (RFA). Current teams have the right to match offers and will receive draft pick compensation if the player leaves.
• Minimum salaries, the luxury tax threshold, amateur draft slots, and international draft slots increase each year at least with increase in gross local and national MLB revenues.
• Local TV contracts that give teams an ownership interest in the RSN will be appraised and valued according to market value.
• Baseball related gambling revenue is included
• Eliminate payment of compensation by teams signing individual free agents
• Teams losing free agents receive compensation based on the new total salary/ AAV if arbitration is offered and declined. Top 100 salary= supplemental 1st round pick; Top 200= Supplemental 2nd round pick. No team above the tax threshold gets compensation.
• The designated hitter will be used in all major league games
• MLB rosters include 26 players, increasing to 30 players on September 1

Amateur player drafts:

• An International draft with hard slotting bonuses will be implemented. Teams must offer at least 90 percent of slot to each player and pay 100 percent of slot bonuses total.
• Reduce the Rule 4 amateur player draft to 25 rounds.
• Teams that don’t sign a drafted player receive a supplemental round pick the next draft, rather than just one slot down
• A weighted lottery among non playoff teams will be held for the first 3 draft picks
• One competitive balance round includes all 15 non market disqualified teams

Minor league players

• Minor league players will receive at least $800 per week in A ball, $900 per week in AA, $1,000 per week in AAA, starting when they report, through the playoffs
• Players on 40 man roster, or with 0.5 seasons major league service time receive at least $100,000 per year
• MiLB will also provide a housing option for minor league players

Expansion

• MLB will select two expansion cities by 1/1/2022 to play in 2024. Owners get $2 billion in franchise fees, players get more jobs
• Expansion teams begin drafting in 2022
• Leagues will be aligned into 4 divisions of 4 teams based on geography and market size
• Playoffs expanded to 6 teams per league. First round best of 3 hosted by a division winner.

Perks for the fans:

• NO blackouts. All games will be available to view in all markets via streaming.
• Each team will play 4 home and 4 road double headers per season
• The regular season starts no sooner than April 1 and ends by September 30
• Playoffs concluded by October 31
• Anyone who even suggests starting an inning with runners on base will be fired

Twelve teams spent less than $125 million on payroll in 2019. The cost of increasing minimum salaries to $1 million for 15 players is $6.5 million, less than 10 percent of one team’s share of two new franchise fees. Minor league salary increases equal $300 per week per player, or just over $1 million per team for four MiLB teams.

Seven players received qualifying offers last winter, all but one declined. Three contracts were signed for more than five years.

We have addressed the lack of growth in player salaries vs MLB revenues. We’ve narrowed the salary gap by increasing minimum salaries, adding a salary floor, moving arbitration eligibility back and limiting long mega-contracts. We have an international draft, expansion and better minor league pay. We’ve addressed free agent compensation, tanking and the DH. All without revenue sharing or a formal salary cap!

Not everyone will like this deal. The very highest paid free agents and player agents come to mind. But most players benefit while owners squeeze that non salary cap pretty darn tight. Most importantly, there will be no lockout or strike