Major League Baseball free agency is not the most efficient thing in the world. Everyone knows that. That’s why prospects are so valuable even when, statistically, any individual one is unlikely to become a star. The way baseball economics is set up, those prospects, if they are good, are significantly cheaper than veteran free agents and therefore a significantly better deal.
There are a lot of quirks to MLB service time rules, but here is the base framework for why free agency is what it is. When a prospect graduates to the big leagues, he is under contract for six full seasons; a midseason call-up does not count towards that number, as it is a partial season. Functionally, that means that new players are under contract for seven years.
Let’s say Peter the prospect makes his debut at age-23 midseason. He would be under team control through age-29, meaning his free agency begins at age-30. Any offer more than three years brings him dangerously close to the mid-30s, when athletes of all kinds break down.
While collusion among owners this year is still very likely, ultimately there’s nothing forcing them to sign big deals for players in their 30s. For the Major League Baseball Player’s Association to increase the revenue towards their players, they can’t just focus on free agency.
The MLBPA needs to get creative. Here are some ways they could do so.
If you’re rebuilding, losing is actively advantageous to your team. It gets you a higher draft spot and more money to spend on bonuses during the draft. Furthermore, if your team is losing a marquee free agent, you gain a draft pick if they sign elsewhere.
The way the current CBA is set up does not incentivize rebuilding teams to spend money. Yes, rebuilding teams do spend money once their produce enough minor league talent, to start competing, but their payroll often bottoms way out. Take a look at these four teams, all of which went through a rebuilding process, all of which won at least one league championship in doing so (salary information thanks to Cot’s Contracts):
Yes, we’ve seen standard inflation since those early ‘10s tanking years, so those raw numbers are naturally going to look a little low already. But that doesn’t change their league ranking. Kansas City and Houston bottomed out to the lowest payroll in the league in the lowest year in their rebuild, and Cleveland was a bottom-five team. As for the Chicago Cubs? Let’s just say that no team embedded in a metro population of 9.5 million people should ever be in the bottom-third of teams in payroll.
If you as a team decide to rebuild or tank or whatever you want to call it, not only will you likely see success—the previous three World Series victors did just that—but it will be cheaper to do so, and all that extra money flows straight through players’ fingers and into the hands of owners.
A salary floor, calculated as a fixed percentage of league revenue to allow for flexibility, is a great way to force teams to spend money on players. The best part is that it doesn’t even affect rebuilding at all. Rebuilding or tanking teams simply need to fill the payroll floor by taking on dead or useless contracts from other teams eager to offload those contracts in return for prospects. That would have a cascading effect, where teams would not only feel free in making aggressive offers to free agents knowing they could move them later, but with a salary floor the teams moving the dead contracts could then use that money towards other players.
NBA-STYLE ROOKIE CONTRACTS
The structure of MLB allows teams to control players for an absurdly long time. Between Minor League rights and MLB rookie contracts, a team could ostensibly control a player’s rights for over a decade after drafting said player. MiLB salaries are pitiful—which we’ll get to in a moment—and a player doesn’t start making the #millions you think baseball players do until their fourth season with a big league club.
One way the MLBPA could give players more agency, encourage team spending, and cultivate greater free agent contracts is by negotiating a modification of the salary framework that exists to be similar to National Basketball Association rookie contracts.
NBA rookie contracts consist of two guaranteed years, two option years, and restricted free agency. While this is somewhat similar to baseball’s arbitration process, it is a much shorter process and allows for significantly greater player agency.
Adopting a similar ruleset would have a number of positive consequences for players. The biggest reason would be that, like the NBA, players would enter free agency much sooner, meaning they would have greater choice in where to play and would command greater salaries that teams would be happier to dole out (as those players would be in their 20s as opposed to 30s). Bryce Harper becoming a free agent at age-26 would be the rule, not the exception.
Another thing this might do is eliminate what happened to Kris Bryant in 2015, and what often happens to other promising youngsters. Currently, teams hold their top prospects in the minors until May so that they can squeeze an extra season of control out of them. But if, say, triggering the first year of a rookie contract burns that year regardless of when it’s triggered, we’d see a lot more teams begin the year with rookies and prospects.
VASTLY INCREASED MINOR LEAGUE PAY
You almost certainly don’t know how much MiLB players get paid. That’s a travesty, because there are thousands of minor league players who will never get to cash in their big payday, and some that could if they only didn’t have to substitute teach to make ends meet in the winter.
A few years ago, a collection of MiLB players assembled a lawsuit against then-commissioner Bud Selig and MLB. Last year, that lawsuit was dismissed last year by a U.S. Court of Appeals, as baseball is exempt from antitrust law. Still, the players’ lawsuit highlighted some intense problems:
The lawsuit portrays minor league players as members of the working poor, and that’s backed up by data. Most earn between $3,000 and $7,500 for a five-month season. As a point of comparison, fast food workers typically earn between $15,000 and $18,000 a year, or about two or three times what minor league players make. Some minor leaguers, particularly those with families, hold other jobs during the offseason and occasionally during the season.
Minor league players can’t get full-time gigs because they are working half the year elsewhere. Their summer job is physically strenuous and physically dangerous, featuring the possibility of debilitating injury. Developing a good resume or job history is difficult, and continuing education is borderline impossible, as spring semesters for universities conflict with the start of baseball season.
And, oh yeah, minor leaguers aren’t paid for spring training or instructional leagues. That should make you uncomfortable. I mean, come on (emphasis mine):
Watkins’ first season was spent in the Rookie-level Gulf Coast League in Fort Myers. The Twins wanted him to get adjusted to pro ball, so he lived with teammates at a hotel that summer instead of staying at home for free.
Because of that, he cleared a whopping $140 a month in salary.
“What can you do for $140 a month?” he said. “You eat. If you wanted to buy a hat or a CD or something else, that was tough.”
MLB pulls in $10 billion in revenue, and some of its employees don’t have enough take home money to purchase a hat.
While antitrust law doesn’t apply to baseball, that doesn’t mean that the MLBPA is unable to negotiate higher salaries for minor league players. Doing so would be extraordinarily easy, and not even expensive considering baseball’s gigantic revenue. From some simple back-of-the-napkin math, diverting $15 million from owners’ pockets into the minor league system would give each player a $5,000 raise. And that’s not $15 million per owner: that is $15 million total. Add in reasonable pay for spring training and instructional leagues and you’ve got yourself a minor league pay system that isn’t actively antagonizing its own lifeblood.
By this line of thinking, significantly increasing the Major League minimum would also be another way to guarantee money goes into the hands of the players, but it would also be more expensive.