The World Series has concluded, which means hot stove season is officially upon us. Players have officially filed for free agency and teams are already making trades before the championship celebration hangovers can subside. There will be drastic changes to numerous organizations in the upcoming months, however the biggest story off-season will be the thundercloud that’s been on the horizon for the past few years finally arriving: the re-negotiation of MLB’s collective bargaining agreement (CBA).
We are less than a month away from the December 1st expiration deadline of the current CBA. This agreement has been in place since the 2016-2017 off-season and was just the second time the two sides reached an agreement on a new deal before the expiration of the existing contract. While that could happen again in the next few weeks, it is unlikely.
The two sides have been at odds since the last CBA negotiations, and reports indicate that negotiations between the two sides have been ongoing since April but are still far from resolved. This makes a lockout from the league - forcing a work stoppage after the expiration deadline - appear to be a real possibility.
If (when) the lockouts hits, baseball will be at a stand-still until a new agreement is in place. That stasis could last days, weeks or even months. This will halt all activity for clubs looking to build up their roster and players finding homes for the 2022 season, so November could be a very important window for both sides to get their business done.
But what are the issues that are dividing the two sides? In the 2016 CBA, there were points big and small that were resolved in the final deal. Many of those same issues will be on the table again in these negotiations, along with some new ones.
The tip of the iceberg
Revenue distribution will once again be the underlying focus between the two sides. Changes to the MLB minimum salary, Rule 4 Amateur Draft spending pools and international signing bonuses were arranged in the prior agreement and will likely be reconfigured again. The structure of MLB’s revenue sharing between franchises, which is partially attached to the competitive balance “luxury” tax (more on that later), was also altered and will likely be a point of emphasis again.
These will be nuanced changes that will impact bottom lines in ways that are beyond most of our pay-grades.
The on-field product and playoff format
There are some of the quality-of-life changes that both sides have been pushing to make for years. Some of these adjustments - the pitch clock and three-batter minimum, for example - have already been implemented, but there are many other alterations being pushed for.
The argument for a designated hitter in the National League - which was a reality in 2020 - has been gaining steam for years and could become permanent starting in 2022. The pace of play and length of games has been a constant area of discussion and could be the basis for additional rule changes that have been experimented on in recent seasons.
Another rule change during the 2020 season that could become permanent is an increased playoff format. This is a revision that has already been publicly proposed by the league to increase the pool from 10 to 14 teams.
Playoff berths produce revenue from both the ballpark gates and national TV contracts, and the playoff field increased from 8 to 10 in the last labor deal. Meanwhile, increasing the offensive output at a faster pace is the principal thought for many on how baseball can improve it’s entertainment value. Support for these changes are not universal, however both have gained traction for years and have a good chance of coming to fruition in this deal.
Service-time, free agency and the competitive balance “luxury” tax
This is where the biggest pieces of the economic pie are cut out and where the largest gape between the two parties exists. In the 2016 agreement, salary arbitration eligibility was unchanged, the compensatory draft pick penalties were reduced for teams signing a player who rejected a qualifying offer and the competitive balance “luxury” tax threshold was increased, with the tiered tax-rate for teams exceeding the threshold inflated.
The player’s union has publicly been pushing hard for major changes to this system and a dramatic restructuring could occur, but it will be a turbulent ride between the two sides to make it happen.
In August, it was reported MLB made a proposal to the union that addressed the luxury tax and would create a minimum salary floor. Under this proposal, all teams would need to meet a minimum payroll of $100 million but the luxury tax threshold would be lowered about 15% from $210 million to $180 million.
In September, details emerged that the league approached the union about changes to the salary arbitration and free agency systems as well. First reported by Joel Sherman, the proposal indicated the league was offering a universal free agent age of 29 ½ years and a collective salary arbitration pool of $1 billion.
These proposals were not well received by the player’s union. The league fully expected this when it submitted the propositions in the first place, which is why they included an alternative offer to keep the current structure intact instead. The union reportedly submitted it’s second proposal to the league on October 29th in response, making no concession to the league’s offers from August and September and only slightly altering the terms it laid out in it’s first proposal back in April.
The players are fighting for major changes that will increase earnings based on performance at a younger age and get players to an open market filled with more suitors faster. Meanwhile, the league is showing it will only be willing to deviate from the current system on terms that become more favorable for them. This tells you all you need to know about the unease that has existed since 2016 and the current state of negotiations.
Privately and publicly, the two sides will continue to go back-and-forth with each other, fighting hardest for its own interests on these and other issues. For how long and what the end result will be are the questions we don’t have answers to yet. It may be a long, contentious winter before we finally find out.
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How much is a ‘Coors Field Tax’? Do free agents want the Rockies? Big changes in this mailbag | The Athletic ($)
Nick Groke opens his mailbag to answer some questions from Rockies fans. Groke examines the “Coors Field Tax” the organization faces when attracting pitching in an extreme hitter’s environment. One agent has suggested a 100% increase, which Groke finds believable in moderate salaries. Next, Groke examines the depth at shortstop once Trevor Story departs with Ezequiel Tovar being justifiably eyed as the future at the position. He also touches on the sour reputation the organization has gained for alienating players - Story the latest - and how that will affect their ability to attract hitters to come to Colorado.
Finally, Groke describes the 40-man roster crunch the team is facing, possible rule changes that could come from the upcoming CBA, positive additions to the organization’s analytics department and the significant restructuring of the organization’s front office and coaching staff.
On the Farm: Arizona Fall League Edition
The Rafters fell to 7-12 in the fall season with a loss on the road against Mesa. Ezequiel Tovar, Ryan Vilade and Willie MacIver all started for Salt River but did not find much success in this one. The group combined to go 0-for-12 at the plate with three strikeouts and left eight runners on base. The scored was tied at two through seven innings of play, but in the eighth Isotopes’ lefty Reagan Todd gave up a go-ahead homer to Marlins’ farmhand Kameron Misner and ultimately took the loss.
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