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All the details in MLB’s new Collective Bargaining Agreement

Your ultimate guide to the new CBA

2021 SiriusXM All-Star Futures Game

As players are reporting to spring training sites in Florida and Arizona, with Grapefruit and Cactus league games set to begin on March 17- 18, the ink is just now drying on the pages of a new five year collective bargaining agreement (CBA) between major league baseball (MLB) owners and players. Here are all the details of the agreement:

Ratification: The MLBPA voted to ratify the agreement by a 26- 12 vote after their executive committee voted 8- 0 against it. MLB owners voted 30- 0 in favor, making it official.

With ratification, the owners’ lockout and the transaction freeze is over. Free agents can be signed, players may be traded, and teams and players alike will submit salary requests for arbitration by March 22.

2022 Season: Opening day is on April 7, 2022 with a full 162 game schedule to be played. The season will be extended by three days to permit one of the two series that had been canceled to be played, and the other games will be made up in nine inning double headers.

Players must report to spring training by March 11, 2022, although there will surely be some issues with visas for some international players.

I. Term:

Five years from 2022 to December 1, 2026

II. Expanded playoffs:

12 teams will make the playoffs starting in 2022. The two division winners with the best records in each leaguewill receive a bye.

The third division winner will be the highest seed in the first round and the wild card team with the best record will be the next. These two teams will host a three game first round series.

Starting in 2023, all teams will play each other including teams in both leagues, in a more balanced schedule. (More inter-league play)

No game 163: In case of ties, there will be no tiebreaker game 163 at least in 2022. A formula will be used to break ties. We will see if this provision lasts into 2023 and beyond.

III. Playing Rule Changes:

The universal designated hitter will be used in both leagues starting in 2022.

Seven inning double headers and ghost runners in extra innings are gone- for now.

A competition committee comprised of six members appointed to rubber stamp by the commissioner, four players including at least one pitcher, and one umpire will review proposed changes, beginning after the 2022 season. Changes may take place within 45 days after approval.

Coming in 2023:

  • Larger bases, First, second and third base will go from from 15 inches squared to 18 inches.
  • A 14 second pitch clock, maybe 19 seconds with a runner on base
  • A ban on defensive shifts. Teams must have two infielders on each side of second base

IV. Minimum Salaries

The major league minimum salary will increase from $570,500 to $700,000 and increase by $20,000 per season through 2026

Major League Minimum Salary

Year MLB Minimum Salary
Year MLB Minimum Salary
2022 $700,000
2023 $720,000
2024 $740,000
2025 $760,000
2026 $780,000

Minor League Minimum Salary

The CBA sets minimum salaries for players on 40 man rosters, with a significant increase for players under their second major league contract or with at least one day of major league service time. Free agent players can negotiate higher salaries.

Minor League Minimum Salary

Year 1st year players 2nd year +
Year 1st year players 2nd year +
2022 $57,200 $114,100
2023 $58,800 $117,400
2024 $60,300 $120,600
2025 $62,000 $123,900
2026 $63,600 $127,100

WE INTERRUPT THIS ARTICLE TO BRING YOU THIS COMMERCIAL:

Players who are not on 40 man rosters and have no major league service time are not covered by the CBA. In fact, they are excluded from federal minimum wage laws. They are not paid for spring training or the extra hours that they put in. In 2022, MLB has ordered teams to provide housing. We’ll see how that goes.

Here is their minimum pay scale.

Minor League Salaries

Level Minimum pay 23 weeks
Level Minimum pay 23 weeks
Rookie $400/week $9,200
Hi A, Low A $500/week $11,500
AA $600/week $13,800
AAA $700/week $16,100

NOW BACK TO THE CBA

V. Pre- Arbitration Bonuses

For the first time, players who are not yet eligible for arbitration may receive a bonus based on their performance. The total amount of the bonus pool is $50 million per season, which will not increase during this CBA. The pool will be divided among the top 100 players in this service class.

Bonus Schedule:

  • MVP or Cy Young Winner: $2.5 million
  • 2nd place MVP or Cy Young: $1.75 million
  • 3rd place MVP or Cy Young: $1.5 million
  • 4th, 5th place MVP or Cy Young: $500,000
  • Rookie of the Year winner: $750,000
  • ROY second place: $500,000
  • The rest of the bonus pool will be divided among the top 100 performers in the service class, based on a formula to be determined, likely based on a variation of Wins Above Replacement.
  • Players may only receive one bonus award per season

VI. Service Time Manipulation

  • The top two players in Rookie of the Year voting must receive at least a full year of service time, regardless of when they were called up.
  • Teams that promote a player to the opening day roster and keep him up for a full season will be eligible to receive up to three draft picks if the player finishes in the Top 3 in the Rookie of the Year voting or Top 5 in MVP/Cy Young voting before he is eligible for arbitration.
  • A player may be optioned to the minors no more than five times in one season

VII. Competitive Balance Tax

The lowest threshold will increase from $210 million to $230 million, and higher thresholds with increased penalties are set at $20 million intervals, with a new fourth tier at the upper level. The tax rates and penalties remain the same except for the new tier.

Here is the tax table:

Competitive Balance Tax Table

Tier 2022 amount 1st-time payor 2nd-time payor 3rd-time payor
Tier 2022 amount 1st-time payor 2nd-time payor 3rd-time payor
First threshold $230 million 20.00% 30.00% 50.00%
Second threshold $250 million 32.00% 42.00% 62.00%
Third threshold $270 million 62.50% 75.00% 95.00%
Fourth threshold $290 million 80.00% 90.00% 110.00%

The first threshold will increase slightly each year, with higher thresholds remaining at $20 million increments above the first. The first threshold will be:

  • 2022: $230 million
  • 2023: $233 million
  • 2024: $237 million
  • 2025: $241 million
  • 2026: $244 million

So, for example, the thresholds in 2026 will be $244M, $264M, $284M and $304M.

“Non monetary penalties” remain. A team that exceeds the lowest threshold by $40 million will have their highest draft pick not among the top six picks moved back 10 slots.

How the CBT proceeds are distributed has changed. 50% of taxes will go to players’ retirement accounts and 50% to a new discretionary fund for revenue sharing payees based on a formula to include non media local revenue (i.e. gate receipts which fluctuate with winning).

VIII. International Draft

The current hard bonus limit system will remain in place for 2022. Players and owners may agree by July 25 to implement an international draft to begin in 2024.

IF the parties agree on an International Draft, there will be no compensation paid by teams for signing free agent players (The Qualifying Offer System).

If there is an International draft, here are some details:

  • There would be 20 rounds, with more than 600 players drafted
  • Signing bonuses would be guaranteed according to the slot values
  • Bonus picks would be awarded to teams that draft players from emerging countries
  • Total increase from prior labor deal to the new agreement for amateur bonuses is expected to be about $20 million, according to MLB
  • Draft picks could be traded

IX. Free Agent Compensation

IF the parties agree on an international draft, teams will receive supplemental draft compensation for losing first time free agent players. The compensation is based on the status of the former team’s revenue payee/ payor/ CBT status and the amount that the player signs for as follows:

Free Agent Compensation

Former club status 35M TG/ 18M AAV 55M TG/23M AAV 100M TG/ 30M AAV 150M TG/ 40M AAV
Former club status 35M TG/ 18M AAV 55M TG/23M AAV 100M TG/ 30M AAV 150M TG/ 40M AAV
Revenue Payee 3rd round Comp B Comp A Comp A+ 3rd round
Revenue Payor --- 3rd Round Comp B Comp A
CBT Payor --- --- 3rd Round Comp B

The Associated Press

Compensation tiers are based on:

  • the total guarantee (TG) OR the average annual value (AAV) of the player’s new contract, whichever is higher, and
  • The Revenue paying and CBT status of the former club
  • The player must be a first time free agent, and have been with the former team for at least one full season.
  • There is no qualifying offer of salary or arbitration required for compensation.

X. Amateur Player Draft

Lottery

The first six selections in the Amateur player draft will be awarded via a lottery. All teams that did not make the playoffs in the prior season are eligible. The three teams with the worst records will each have a 16.5% chance at the first selection (total 49.5%) and others a lesser chance based on winning percentage. 11 teams have less than 5% chance at the first pick.

Revenue sharing payee clubs may not have a lottery pick in three straight years. Revenue sharing payors may not have a lottery pick in consecutive years.

The draft order after the first six picks will be determined by playoff finish, then revenue sharing status, then winning percentage.

  • The Draft is officially reduced to 20 rounds
  • An annual pre draft combine will be held. Players who participate, take a physical and are drafted must receive at least 75% of the slot bonus, or be declared free agents
  • Players drafted after the 10th round who don’t sign may attend a Junior College under the draft-follow-evaluate plan (DFE).
  • The draft-and-follow rule returns, allowing clubs that select players who opt to attend junior college to sign them between the end of their juco season and the beginning of the next year’s Draft. Any bonus amount over $225,000 will count toward teams’ bonus pools. A similar rule existed before being eliminated with the 2007-11 CBA.
  • The assigned values for each choice in the first 10 rounds will increase for the first time since the 2019 Draft, though the exact details aren’t yet known. For players in rounds 11-20, the amount that won’t count towards teams’ bonus pools rises from $125,000 to $150,000.

XI. Revenue Sharing

Teams will continue to put 48 percent of net local revenues into revenue sharing.

The Oakland A’s are restored as a revenue sharing payee

The players’ grievance against the A’s, Rays, Pirates, and Marlins remains unsettled

XII. Pension Benefits

Pension benefits for retired players will increase

Medical benefits for current players under the plan are improved

XIII. Exhibitions

Players will participate in exhibition games in Mexico, Asia, Puerto Rico, The Dominican Republic, London, Paris, and in domestic exhibitions such as Little League and Field of Dreams.

XIV. Joint Drug Program

  • There will be an increase in the number of in-season urine tests for Performance Enhancing Substances and Drugs of Abuse as well as adjustments to the scheduling of these tests to make them less predictable.
  • The Program will now utilize dried blood spot testing (rather than venous blood draws) for hGH testing, making MLB the first professional sport drug testing program to adopt this new technology.
  • The parties agreed to update the joint treatment program for alcohol-related and off-field violent conduct to include marijuana-related conduct, which will require a mandatory referral to the Treatment Board when certain conduct occurs.

OTHER HIDDEN GEMS

  • Sponsor Patches and Helmet Decals: Clubs will be allowed to make sponsorship agreements for patches on jersey sleeves and decals on helmets. Estimated value $6-8 million per team, per year
  • Salary Arbitration agreements are now guaranteed one year contracts. There must be an agreement- no hearing. They were previously not guaranteed.
  • $500 Million Grievance from 2020 dismissed: Players filed a grievance for $500 million due to MLB scheduling only 60 games in 2020.
  • Sports Betting: A new policy is created for the players governing commercial arrangements with sports betting companies
  • Roster Size: MLB will continue the 26-man roster limit, increasing to 28 in September, with a limit of 13 pitchers on the roster and 14 in September.
  • Trade Deadline: The Commissioner may set the Major League Trade Deadline on a date between July 28th and August 3rd.