Baseball Is Back Baby!
On January 5th I wrote about the MLB lockout which had started on December 2.
At the time I wrote the piece, the two sides had not spoken at all and there were no talks scheduled. In fact the two sides spent most of the 99 days the lockout lasted not speaking to one another. Even after MLB Commissioner Rob Manfred put a deadline on the talks to keep the season intact, the two sides refused to meet, and when they did the talks were completely unproductive. The Players’ Union was steadfast on getting everything they wanted out of these negotiations and turned down every offer the owners made.
The owners made a final offer on March 1. The date the league had set to not affect the start of the regular season. The proposal set the Luxury Tax threshold at the $220 million in 2022 through 2024, going up to $256 million in 2025 and $263 million in 2026. The players wanted it to be raised to $238 million in the first year of the new agreement, $244 million in 2023, $250 million in 2024, $256 million in 2025 and $263 million in 2026. MLB offered a $30 million pool to pay exceptionally talented pre-arbitration players. The union was seeking a pre-arbitration bonus pool of $85 million that rises by $5 million per year. The owners offered to raise the minimum salary from $575,500 to a $700,000 minimum salary that goes up by $10,000 a year. The union sought a $725,000 salary with $20,000 raises for the first two years. Both side had already agreed on an expanded playoff format from the ten teams in 2021, to twelve teams going forward and a permanent designated hitter for the National League. It appeared to be a fair compromise with both sides giving up some things but the owners giving up more. Unfortunately the MLBPA rejected it almost before it hit the table. That led to the cancellation of Opening Day and the first two series for every team.
Once it became apparent that Manfred was going to actually cancel regular season games and that the players were going to start losing money, the push to get a deal done became more urgent and the two sides met more frequently and the deal was finally done on Thursday (03/10/22).
The deal raised the CBT threshold to $230 million in 2023 and will peak at $244 million in 2026, the final year of CBA. It also introduced a new penalty tier that starts at $60 million past the threshold (the highest tier used to sit $40 million above the threshold). It raised the minimum salary to $700,000 with it going up to $780,000 in 2026 and it raises the pre-arbitration bonus pool to $50 million. It also includes a twelve team postseason, a DH for the National League and the ability for the league to create a new revenue stream by allowing teams to feature advertisement patches on their jerseys and decals on their helmets.
Here’s a closer look at three of the non-financial aspects of the agreement;
More money for younger players.
One of the biggest goals the union had in these negotiations was to reward players who were in the early stages of their career. The way MLB's compensation system is set up, players who have fewer than three years of service time are essentially guaranteed to make no more than the league minimum, no matter how well they play. The new CBA not only raised the league minimum by more than $100,000 (it was $575.5K in 2021), it introduced the pre-arbitration bonus pool of $50 million. Players who are not yet eligible for arbitration will have a chance to make additional money based on where they rank in Wins Above Replacement.1 It won't give them their market's value, or anything close, but it's a considerable boost for talent who would otherwise be drastically underpaid relative to their performance. During negotiations, it was proposed that the money in the pool be split amongst the top 30 performing pre-arbitration players based on WAR.
Postseason changes.
Since the creation of the Wild Card Game in 2012, 10 teams have made the postseason each year not counting the pandemic-shortened 2020 season. That number will now increase to 12 teams. There will be three division winners and three Wild Card teams in each league. The top two division winners in each league will receive byes to the Division Series. The other four teams in each league will play best-of-three series in what will be called the Wild Card round, with the higher seed hosting all three games. There will be no re-seeding for Division Series. The No. 1 seed plays the winner of the 4-5 series, and the No. 2 seed plays the winner of 3-6. There will no longer be play-in games (aka Game 163) to decide playoff spots. All playoff spots will be determined through tiebreaker formulas.
Only one rule change this season but there will be more on the way.
As I said before the DH for the National League is now a permanent thing. However, beginning in 2023, a Joint Competition Committee comprised of four active players, six members appointed by MLB and one umpire will be tasked with making decisions on other changes, such as a pitch clock, limits on defensive shifts, larger bases and the automatic ball/strike system, that have been tested in the low minors and the Atlantic League in 2021. Any rule changes that committee adopts can be implemented with 45 days’ notice to the players.
That’s the latest scoop on Major League Baseball. My next Substack will be on the challenges facing MLB with fans and their lack of enthusiasm for the game, the reasons and potential fixes.
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Wins Above Replacement (WAR) is a sabermetric baseball statistic developed to sum up "a player's total contributions to his team". A player's WAR value is claimed to be the number of additional wins his team has achieved above the number of expected team wins if that player were substituted with a replacement-level player: a player who may be added to the team for minimal cost and effort. Individual WAR values are calculated from the number and success rate of on-field actions by a player, with higher values reflecting larger contributions to a team's success. WAR value also depends on what position a player plays, with more value going to key defensive positions like catcher and shortstop than positions with less defensive importance (according to SABER) such as first base. A high WAR value built up by a player reflects successful performance, a large quantity of playing time, or both. For example, Dodger All-Star pitcher Clayton Kershaw’s 2014 performance rated a WAR of 7.9, means his team won roughly eight more games than would be expected if his innings had been pitched by a replacement level player. Kershaw achieved this high WAR total by pitching many innings while maintaining a high rate of strikeouts and a low rate of hits, homeruns and walks.